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SLA, OLA & Underpinning Contracts

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In this lesson, you will learn:

  • What an SLA is and why it matters
  • The difference between an SLA, an OLA, and an underpinning contract
  • How the three work together on one incident

1 A promise with a clock

When you order a pizza, the shop might promise: “Delivered in 30 minutes, or it’s free!” 🍕 That’s a promise with a time limit.

IT teams make promises like that too. For example: “We’ll fix Priority 1 incidents within 4 hours.” In ServiceNow, these promises are tracked with SLAs.

Key term: SLA

Service Level Agreement. A promise between the IT team and its customers (the business) about how fast something will be done.

2 Three kinds of agreements

Type Between Example
SLA (Service Level Agreement) IT and its customers “P1 incidents resolved in 4 hours.”
OLA (Operational Level Agreement) Two teams inside the company “The Network team replies to the Service Desk in 1 hour.”
UC (Underpinning Contract) The company and an outside vendor “The router vendor ships a new part in 2 hours.”
How SLA, OLA, and underpinning contract fit together for one Priority 1 incident. The customer, SNWR's sales team, has an SLA with IT: resolve in 4 hours. Inside IT, the Service Desk has an OLA with the Network team: respond in 1 hour. The Network team has an underpinning contract with an outside router vendor: ship a part in 2 hours. The smaller promises help keep the big one.
Figure 1. OLAs and underpinning contracts support the SLA the customer sees.

⭐ Remember: SLA = to the customer. OLA = between internal teams. UC = with an outside vendor.

3 Why SLAs matter

  • Clear promises: everyone knows how fast things should happen.
  • Focus: agents can see which tickets are close to breaking a promise.
  • Proof: reports show how often promises were kept.

Key term: Breach

When the time runs out before the work is done. The promise was broken.

📝 Note: In ServiceNow, SLAs, OLAs, and underpinning contracts are all built the same way. The only difference is the Type field on the definition. You’ll build one in Lesson 21.2.

4 Let’s try it: find SLAs

  1. Click All and type SLA. Open SLA Definitions.
  2. Look at the list. Can you find definitions for different priorities?
  3. Group the list by Type. Do you see SLA, OLA, or Underpinning contract?
  4. Open any incident and find the Task SLAs related list.

5 Quick recap

  • An SLA is a timed promise to customers
  • An OLA is a timed promise between internal teams
  • An underpinning contract is a promise from an outside vendor
  • A breach means the time ran out
  • All three are built the same way in ServiceNow

6 Check yourself

Think of your answer first. Then tap to check.

1 The Database team promises the Service Desk a reply within 2 hours. SLA, OLA, or UC? Show answer

OLA. It’s between two internal teams.

2 A laptop supplier promises replacement parts in 1 day. SLA, OLA, or UC? Show answer

Underpinning contract. It’s with an outside vendor.

3 What does “breach” mean? Show answer

The time ran out before the work was done.

Nice work! You finished this lesson. 🎉

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