Experience Level Agreements (XLAs) Explained

Unless you’ve been hiding under a rock for the last two years, you’ve likely heard about experience level agreements (XLAs) and the growing interest in the IT service management (ITSM) industry. However, as with anything new (in our industry), there’s often the assumption that people know what the new thing is. Making it hard for people without that knowledge to “keep up with the conversation.” This situation can make it hard to absorb what’s being said or lead to misunderstandings. It might even lead to people and their organizations being disadvantaged.

The concept of XLAs is definitely one of these “new things.” There’s a lot of hype around them, but there’s also often the assumption that everyone knows what they are and why they are important. Whereas the reality is that many of us don’t yet know enough to fully take advantage of them.

To help, this blog explains what XLAs are and how they can be used to improve business operations and outcomes. But first, there’s a need to start with what “experience” is.

This blog by @Joe_the_IT_Guy explains what XLAs are and how they can be used to improve business operations and outcomes. #ITSM #ServiceDesk #XLA Click To Tweet

Experience explained

The word “experience” on its own might seem pretty “throwaway.” But with organizations having spent the last decade on understanding, improving, and benefiting from their customer experience (CX), the extension of experience internally – to employee experience, end-user experience, service experience, or similar – offers both short-term competitive advantage and the longer-term meeting of IT service delivery and support “table stakes.”

But why are employee experiences important? Some employee experience definitions mirror those for CX, perhaps referring to employee happiness. However, it’s the root causes of the happiness that are most important – because these allow experiences to be improved. Forrester Research shared a fundamental root cause of internal experiences in a 2019 blog: “…the most important factor for employee experience is being able to make progress every day toward the work that they believe is most important.” Making IT’s enablement of work or productivity a key employee experience factor.

If this is “what matters most” to your business and its employees, an XLA needs to focus on this. But more on this shortly.

Technology can improve experiences, but this doesn’t mean it does

I nearly didn’t write this section, but I thought it important to call out that while ITSM tool capabilities can improve employee experiences, simply focusing on the available capabilities misses the point. For example, your organization might have (or add) omnichannel access, service request catalogs, automation, artificial intelligence (AI)-enabled capabilities, and knowledge management to improve experiences, but it doesn’t mean that the improvement will happen. Plus, how do you know, either way, if experiences aren’t measured?

Technology can improve experiences, but this doesn’t mean it does - @Joe_the_IT_Guy #ITSM #ServiceDesk #XLA Click To Tweet

This thinking moves us closer to XLAs, with the need for experience measurement and management.

Experience management explained

Experience management is the use of suitable metrics to understand and improve the delivered experience. For example, the employee experience related to an IT service desk can be measured in terms of employee happiness and employee lost productivity related to support engagements.

Importantly, experience management requires fit-for-purpose experience measurement, and the traditional metrics employed by IT organizations are usually focused on “the mechanics” of IT operations and not the outcomes.

Experience management requires fit-for-purpose experience measurement, and the traditional metrics employed by IT organizations focus too much on the mechanics - @Joe_the_IT_Guy #ITSM #ServiceDesk #XLA Click To Tweet

So, the introduction of XLAs can now be considered a pyramid that starts with an understanding of experiences and “what matters most,” with measurement capabilities then needed to assess and improve the status quo in line with agreed priorities.

XLAs explained (finally)

Having covered experience and experience management, I can finally talk, or write, about XLAs. But let me warn you, if you seek out an XLA definition on Google, you’ll find so many that are different it will likely confuse you more than it informs. It doesn’t help that these different XLA definitions state that it’s a variety of things – from a mindset, through a metric type, to a non-contractual performance agreement.

This ambiguity is similar to what already happens in IT with service level agreements (SLAs). The SLA is the documentation of agreed responsibilities and service-level targets. However, these targets are often called SLAs too.

For me, the XLA is the “agreement,” and the targets are experience-level targets or experience targets or experience indicators. But you know people will soon call the experience targets XLAs and describes XLAs as a particular type of SLAs.

This blog by @Joe_the_IT_Guy looks at the differences between XLAs & SLAs to explain how XLAs offer a new approach to performance measurement, management, and improvement. #XLA #ITSM #ServiceDesk Click To Tweet

XLA definitions

There are formal industry definitions or explanations that help, though. For example, Forrester Research states that “Experience-level agreements (XLAs) promise to quantify employee tech experience, monitor it, and link it to business outcomes.” While ITIL 4 says that an XLA is “A type of SLA designed to establish a common understanding of the quality levels that a customer will experience through the use of the service in terms that are clear to the customer and to which he or she can relate.” And my personal favorite from HappySignals’ CEO Sami Kallio is that “SLAs usually focus on operations and outputs, while XLAs measure performance in outcome and value terms.”

The latter inspired the next section, whereby the differences between XLAs and SLAs hopefully help to draw out how XLAs offer a new approach to performance measurement, management, and improvement.

XLAs versus SLAs

This title might give the wrong impression of XLAs and SLAs being an either-or situation. Instead, the current thinking is that XLAs should be used to supplement SLAs, focusing on different performance aspects.

XLAs and SLAs are not an either-or situation. Instead, XLAs should be used to supplement SLAs, focusing on different performance aspects. Read more here. #ServiceDesk #ITSM #XLA Click To Tweet

In some ways, the best way to understand how XLAs differ from traditional SLAs is to compare and contrast them:

• SLAs are contractual agreements, while XLAs are generally commitments
• SLAs usually focus on operations (the processes) and outputs, while XLAs measure performance in outcome and value terms
• SLAs are forged in, or create, an untrusting and adversarial engagement, while XLAs require a collaborative engagement
• SLAs focus on sanctions for below-par performance, while XLAs focus on rewarding above-par performance
• SLAs can cause unwanted behaviors, while XLAs can spur positive cultural change

Finally, despite all these differences, SLAs and XLAs have important similarities – both are intended to ensure performance and drive improvements through measurement.

Hopefully, this blog has helped aid your understanding of XLAs. If you have any questions, please let me know in the comments.