Service level agreements: ready-rate analysis with lump-sum and linear penalty structures

Alamri, Osama Abdulaziz; Abbasi, Babak; Minas, James P.; Zeephongsekul, Panlop

doi:10.1057/s41274-017-0194-7

Cited by 5 publications

(2 citation statements)

References 15 publications

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“…Service provider's deals with the various issue like based stock (penalty) and review period, they affect the cost with multiple service users. So a service provider prefers to deal with more service users to maintain the demands and large performance review is helpful under the penalty contracts (7)(8)(9).…”

Section: Related Workmentioning

confidence: 99%

Conceptual Service Level Agreement Mechanism to Minimize the SLA Violation with SLA Negotiation Process in Cloud Computing Environment

Kumar

2021

Baghdad Sci.J

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Online service is used to be as Pay-Per-Use in Cloud computing. Service user need not be in a long time contract with cloud service providers. Service level agreements (SLAs) are understandings marked between a cloud service providers and others, for example, a service user, intermediary operator, or observing operators. Since cloud computing is an ongoing technology giving numerous services to basic business applications and adaptable systems to manage online agreements are significant. SLA maintains the quality-of-service to the cloud user. If service provider fails to maintain the required service SLA is considered to be SLA violated. The main aim is to minimize the SLA violations for maintain the QoS of their cloud users. In this research article, a toolbox is proposed to help the procedure of exchanging of a SLA with the service providers that will enable the cloud client in indicating service quality demands and an algorithm as well as Negotiation model is also proposed to negotiate the request with the service providers to produce a better agreement between service provider and cloud service consumer. Subsequently, the discussed framework can reduce SLA violations as well as negotiation disappointments and have expanded cost-adequacy. Moreover, the suggested SLA toolkit is additionally productive to clients so clients can secure a sensible value repayment for diminished QoS or conceding time. This research shows the assurance level in the cloud service providers can be kept up by as yet conveying the services with no interruption from the client's perspective

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Section: Related Workmentioning

confidence: 99%

Conceptual Service Level Agreement Mechanism to Minimize the SLA Violation with SLA Negotiation Process in Cloud Computing Environment

Kumar

2021

Baghdad Sci.J

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“…They determined the optimal penalty-minimizing allocation decisions for customers using the stochastic dynamic programming technique. Alamri, Abbasi, Minas, and Zeephongsekul (2018) investigated the ready rate behavior for a supplier with two retailers using a static base-stock policy. In this article, we investigate the impact of the length of a performance review period when the ready rate is used as the measure of performance in an SLA.…”

Section: Literature Reviewmentioning

confidence: 99%

Service‐Level Agreement with Dynamic Inventory Policy: The Effect of the Performance Review Period and the Incentive Structure

2021

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Performance measures are often outlined in the section of the service-level agreement (SLA) of the contract between a supplier and a retailer. They are monitored periodically, and penalty and/or bonus payments are imposed in each performance review period, according to the SLA clauses. Previous studies have mostly considered a static inventory policy in analyzing SLAs. However, in practice, the supplier may have an opportunity to adjust the stock level in each inventory review period, according to the observed performance. This study analyzes the dynamic stocking decision for a supplier facing an SLA where the supplier sells a single product to the retailer. The ready rate is used to measure the performance in an SLA. To this end, models for both lump-sum and linear penalty/bonus structures are developed, and the optimal stocking decisions for a strategic supplier are calculated using the stochastic dynamic programming approach. The results are then compared with the optimal static inventory policy, and new insights are derived to efficiently design an inventory system for the suppliers that are subject to service-level incentives. In addition, we investigate the impact of SLA parameterssuch as the length of the performance review period and incentive structures-on a supplier's performance, with the probability of meeting or exceeding the target service levels and the supplier's cost. We also consider the impact of demand distribution and inventory holding costs. Results show that under lump-sum incentives, a longer performance review period benefits both the supplier and the buyer, given that the average ready rate increases with less variability as the length of the performance review period increases, leading to decrements in the supplier's total costs. In this scenario, there is a higher chance of gaining bonuses/avoiding penalties for a strategic supplier who adopts a dynamic inventory policy. On the other hand, under linear incentives, the impact of the performance review period on the supplier's cost and the performance measure (i.e., ready rate) is complicated and depends on the magnitude of the holding cost and the bonus and/or penalty structure of the contract. Under this scheme, the performance of a static inventory policy is highly dependent on the holding cost because a high holding cost may lead to failure to meet the contract requirements in terms of the service level.

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To outcomes and beyond: Discursively managing legitimacy struggles in outcome business models

Korkeamäki

Kohtamäki

2020

Industrial Marketing Management

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Service level agreements: ready-rate analysis with lump-sum and linear penalty structures

Cited by 5 publications

References 15 publications

Conceptual Service Level Agreement Mechanism to Minimize the SLA Violation with SLA Negotiation Process in Cloud Computing Environment

Conceptual Service Level Agreement Mechanism to Minimize the SLA Violation with SLA Negotiation Process in Cloud Computing Environment

Service‐Level Agreement with Dynamic Inventory Policy: The Effect of the Performance Review Period and the Incentive Structure

To outcomes and beyond: Discursively managing legitimacy struggles in outcome business models

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