Practice Quiz

PMI PMP Project Management

Category - Procurement Management

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Boris hires an outside vendor to maintain their servers. However, he is extremely concerned about uptime. In order to remain profitable, Boris’ company needs to have 99% uptime. Which of the following would be a clause Boris would want to include in the contract to directly address this requirement?
  1. Privity
  2. VC
  3. SLA
  4. CPPF
  5. Retainage
Explanation
Answer: c - SLA stands for Service Level Agreement, which basically addresses the expectations of the buyer. In event the vendor does not meet the requirement, the buyer of the services can expect compensation, or may be allowed to void the contract.

Key Take Away: Service level management has become a big buzzword in the service industry. Creating a SLA helps set expectations on both sides of the coin.
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