SCHEDULE 1 - SERVICE PERFORMANCE MANAGEMENT

1. INTRODUCTION

1.1 The objectives of Service Performance Management are to:

1.1.1 ensure that the End to End Services are of a consistently high quality and
meet the Service Level targets and other requirements of the Customer;

1.1.2 provide a mechanism whereby the Service Levels, Key Performance

Indicators (KPIs) and Service Credits can be modified over the Contract
duration in response to the changing requirements of the Customer and its
Business Units; and

1.1.3 incentivise the Supplier, TS Supplier and Collaborating Supplier to:

1.1.3.1 meet the Service Levels and KPIs;

1.1.3.2 work with each other to ensure that the Service Levels and KPIs are
met; and

1.1.3.3 promptly rectify any failure to meet the Service Levels or KPIs.

1.1 Service Level and KPI Principles

1.1.4 Service Levels, Service Level Targets and KPIs are set out in this Schedule
for specific performance and availability characteristics for the Tower
Services. Any failure by the Supplier, TS Suppliers or Collaborating
Suppliers to deliver the Tower Services and achieve the Service Level
Targets and KPIs described herein will have a significant impact on the
Customer’s operational effectiveness and efficiency and subsequently its
ability to fulfil its statutory obligations.

1.1.5 The Service Levels, Service Level Targets and KPIs are focussed on the
Customer; reflect the needs of the Customer and represent the End to End
Service quality that is required by the Customer, its Business Units and end
users.

1.1.6 The Supplier shall work collaboratively with TS Suppliers, Collaborating

Suppliers and Other Customer Suppliers to deliver the End to End Services,
Service Level Targets and KPIs.

1.1.7 In respect of network, communications, computer or other equipment

provided by a third party contractor that do or are required to interface with
the Supplier ICT Environment, the Supplier shall have primary management
responsibility for incident and problem resolution, including:

1.1.7.1 for ensuring that such requirement does not interfere with the
provision of the Services in accordance with this Contract and the
Collaboration Agreement; and

1.1.7.2 for taking all necessary steps within its power to ensure that the
interface is successfully achieved.

1.1.8 The Supplier shall work with and assist TS Suppliers, Collaborating Suppliers
and Other Customer Suppliers to achieve the Service Level Targets and KPIs
 that relate to the End to End Services which the Supplier, TS Suppliers,
Collaborating Suppliers and Other Customer Suppliers are responsible for.

1.1.9 The Supplier shall be open, transparent and honest about the levels of
performance and service quality the Supplier is achieving with the Customer
and the TS Suppliers, Collaborating Suppliers and Other Customer Suppliers,
as set out in paragraph Error: Reference source not found.

1.1.10 The Supplier shall ensure that Tower Services are delivered in accordance
with the Service Level Targets and KPIs and the performance measures for
each Tower Service under the respective Tower Services Agreement, or
each service component thereof, agreed between the TS Suppliers,
Collaborating Suppliers and the Customer and captured in the documentation
for the Tower Service.

1.1.11 Where applicable (or where requested by the Customer), the Supplier shall
ensure that the Tower Services are designed such that the Performance
proposed for each Tower Service, or component thereof, and captured in the
documentation for the Tower Service, enable the Tower Service to be
delivered to the Service Level Targets and KPIs specified in this Schedule.

1.1.12 In the event that any Tower Service or component thereof, does not achieve
the agreed Service Level Targets, KPIs or any other agreed Performance
measures, the Customer reserves the right to invoke a review of the Service
Levels, Service Level Targets and KPIs in this Schedule.

1.1.13 The Supplier shall co-operate with any review of Service Levels, Service
Level Targets and KPIs undertaken in accordance with the provisions of
paragraph 1.1.12. The Supplier shall not unreasonably withhold agreement
to the introduction of new Service Levels, Service Level Targets and KPIs or
the amendment of existing Service Levels, Service Level Targets and KPIs if
such new or amended Service Levels, Service Level Targets and KPIs shall
support the performance of an End to End Service, or component thereof, in
accordance with its agreed Performance.

1.1.14 The principles governing the establishment and review of Service Levels,
Service Level Targets and KPIs and the application of Service Credits during
the term of this Contract shall be as follows:

1.1.14.1 all Service Levels, Service Level Targets and KPIs shall be
relevant and important to the effective delivery of the Customer’s
business; and

1.1.14.2 all Service Levels, Service Level Targets and KPIs shall be
measurable.

1.1.15 For the Service Levels, Service Level Targets and KPIs that are Shared, as
defined in Part B of Annex A of this Schedule, the Supplier shall work with the
TS Suppliers, Collaborating Suppliers and Other Customer Suppliers for the
measurement and management of these Service Levels, Service Level
Targets and KPIs. The Supplier shall provide Management Information and
Service Credit calculations in an aggregated form to the Customer based on
the information provided by TS Suppliers, Collaborating Suppliers and Other
Customer Suppliers. The Management Information may include, but shall not
be limited to:

1.1.15.1 Service Availability of End to End Services or Business

Applications;

1.1.15.2 Application Performance Management;

 1.1.15.3 Resolution Targets for incident management;

1.1.15.4 Resolution Targets for service request management;

1.1.15.5 Service Level Targets in the provision of Tower Services, or

activities or tasks that make up a Request For Service; and

1.1.15.6 ITSM practices that have a reliance or dependency upon the

Customer, and/or combinations of the Supplier, TS Suppliers,
Collaborating Suppliers and Other Customer Suppliers

1.1.16 The Supplier, TS Suppliers and Collaborating Suppliers shall collaborate with
each other and the Other Customer Suppliers in seeking to ensure that the
End to End Services are made available and supported as per the Service
Availability and Support Availability categorisations set out in this Schedule.

1.1.17 The Supplier and TS Suppliers shall be jointly and severally liable for
ensuring that Service Availability is measured in accordance with this
Schedule.

2. SERVICE LEVELS REPORTING AND MANAGEMENT INFORMATION

2.1 In accordance with Error: Reference source not found (Services Requirements) the
TS Suppliers shall report to the Supplier on the Performance of the Tower Services
against the Service Levels, Service Level Targets and KPIs specified herein and shall
provide the Supplier with the relevant information pertaining to the Tower Services,
Business Applications or components thereof for each Service Reporting Period
setting out how the Tower Services and Business Applications have performed and
whether the Service Levels, Service Level Targets and KPIs associated with that
Tower Service or Business Application have been met.

2.2 The TS Suppliers shall also include in the report specified at 3.1.1 for the Reporting
Period, information about the general Performance of the Tower Services and
Business Applications.

2.3 The Supplier shall provide combined and aggregated Management Information and
Reports, as agreed with the Customer and as set out in Error: Reference source not
found (Services Requirements). These shall include, but not be limited to: the
achievement or non achievement for all the End to End Services, Tower Services
Service Level Targets and KPIs and the accumulation and apportionment of Service
Credits as incurred by the Supplier and each TS Supplier.

3. MANAGEMENT AND ESCALATION OF SERVICE LEVEL TARGETS AND SERVICE

LEVEL THRESHOLD FAILURES

3.1 Introduction

3.1.1 The procedures set out in this Section are intended to enable the Supplier
and TS Suppliers to manage service issues arising from failure to achieve the
Service Level Targets and Service Level Thresholds as set out in this
Schedule. The Supplier and/or any TS Supplier can escalate issues further
in accordance with the Escalation Procedures as defined in the Collaboration
Agreement or Error: Reference source not found (Dispute Resolution
Procedure), as appropriate.

3.1.2 The Service Credit provisions of this Schedule shall continue to apply
throughout the Escalation Process.
3.1.3 The Supplier and TS Suppliers shall proactively resolve outstanding issues
relating to Service Availability and Performance and raise awareness of any
matters that have, or may have, a material impact on the Service Availability
or Performance of the Tower Services and Business Applications.

3.1.4 Where further remedial action is required, the Supplier and TS Suppliers shall
provide a Recovery Plan. The scope and format of all Recovery Plans shall
be defined and documented by the SIAM Supplier in the Service Level
Management Policies, Processes and Procedures, as set out in Error:
Reference source not found (Service Requirements).
ANNEX A SERVICE LEVELS

1. INTRODUCTION

1.1 This Annex sets out the Service Level Targets and KPIs that shall be measured and
reported on by the Supplier, including:

1.1.1 how Service performance will be calculated (see Part A); and

1.1.2 the Service Level Targets and Service Credits (see Part B).

1.2 The Supplier will be responsible for the collection, collation and aggregation of all
information from all TS Suppliers and shall present these to the Customer at
predetermined times as required under this contract.

PART A: CALCULATION OF SERVICE PERFORMANCE

2. PRINCIPAL OBJECTIVES

2.1 The objectives of the Service Measures, Service Credits and other related remedies
are to:

2.1.1 ensure that the Services are of a consistently high quality and meet the
Service Level Targets and other requirements of the Customer;

2.1.2 use Service Credits as a method of price adjustment to reflect poor

performance in breach of the required Service Level Targets;

2.1.3 provide a mechanism whereby the Service Credit regime can evolve over the
duration of the Contract as the profile of Services change; and

2.1.4 incentivise the Supplier to meet the Service Level Targets and work with
Tower Service providers to remedy any failure to meet the Service Level
Targets promptly.

2.2 The Parties acknowledge that:

2.2.1 the Customer will, in all cases, prefer to receive the Services at the Service
Level Target in preference to receiving the Service Credits; and

2.2.2 the Supplier shall, in all cases, seek to deliver the Services at the Service
Level Target in preference to accepting a liability for Service Credits.

3. SERVICE LEVELS

3.1 The Contractor shall monitor its performance of each of the Service Criteria referred
to in A by reference to the applicable Service Level Targets and shall send the
Customer a Performance Monitoring Report as part of the monthly Service Pack.

3.2 If the Achieved Service Level does not meet the Service Level Target for a Service
Measure, then Service Credits will be due from the Supplier in accordance with
Paragraph 5 of this Part A and Part B of this Appendix.

3.3 For each Service Level, there is a defined Service Level Target and a Service Failure
Threshold in Part B of this Appendix.
 3.4 All Service Level Targets shall be measured over a Service Measurement Period,
which unless otherwise expressed in writing by the Customer, shall be a Calendar
Month.

4. REPEAT FAILURES TO MEET SERVICE LEVEL TARGETS

4.1 If the Contractor fails to achieve a Service Level Target for a particular Contractor
System, Service and/or Service Element in a Service Measurement Period and then
fails to achieve the same Service Level Target in a subsequent (as defined in Table 4
below) Service Measurement Period, the failure in the subsequent Service
Measurement Period shall be a “Repeat Failure”. The Repeat Failure count shall
increment by one (1) for each additional failure.

4.2 Repeat Failures shall apply to Service Level Targets for Availability, Incident
Resolution and Quality. Repeat Failures shall not apply to Service Level Targets for
Provisioning.

4.3 The Repeat Failure count shall be reset to zero (0) once there have been two (2)
consecutive Service Measurement Periods in which the Service Level Target has
been met.

4.4 In Paragraph 4.1 of this Part A, the reference to Repeated Failures to achieve a
Service Level Target shall be to the Service Level Target for one (1) Service
Measure.

4.5 A worked example is set out below:

Service Measurement Period

1 2 3 4 5 6 7 8 9 10 11 12
Failure to meet Service F F F F F F F
Level Target for a     
Service (F)
No. of Repeat Failures 0 1 2 0 1 2 3
Table 1 Repeat Failure Example

4.6 For any failure to meet Service Level Targets which is a Repeat Failure, the Service
Credit applicable shall be increased as follows (a “Repeat Failure Multiplier”):

Repeat Failure count

applicable to the Repeat Failure
Service Measurement Multiplier
Period

0 1
1 1.5
2 1.75
3 and above 2
Table 2 Repeat Failure Multipliers

5. SERVICE CREDIT CALCULATION

5.1 Service Credits are required to be paid in the event that the Achieved Service Level
falls below the Service Level Target in a Service Measurement Period.
5.2 The Service Credit is determined by the Achieved Service Level, the Service Level
Target and the Service Failure Threshold and is calculated by using the straight line
formula below:

Service Credit % = (m (a-x) + c) * Repeat Failure Multiplier

where

 a is the Service Level Target (%) below which Service Credits become payable;

 b is the Service Failure Threshold (%);

 x is the Achieved Service Level (%) for a Service Measurement Period;

 c is the minimum Service Credit (%) payable if the Achieved Service Level falls below the
Service Level Target;

 d is the maximum Service Credit (%) payable if the Achieved Service Level reaches the
Service Failure Threshold;

 m is a coefficient defined for the Contractor System, Service and/or Service Element
which is calculated from the formula m = (d-c)/(a-b), that is the slope of the straight line;
and

 Repeat Failure Multiplier shall have the meaning set out in Paragraph 4.6 of this Part A.

5.3 For the avoidance of doubt Service Failure Threshold is as defined in Schedule 24
(Definitions).

5.4 Unless stated otherwise in Part B of this Appendix, the Service Credit (£) is calculated
by Service Credit (£) = Service Credit (%) x Service Charge for the Service
Measurement Period.

5.5 The Service Charge shall be the Charge for the Service Measurement Period.

5.6 Service Credits for a particular Service for the Service Criteria are cumulative.

5.7 Aggregate Service Credits for all Services delivered by the Contractor to the
Customer shall be limited in each Service Measurement Period to twenty percent
(20%) of the aggregate Charges payable to the Supplier within the same Service
Measurement Period.

5.8 The Customer may use the Performance Monitoring Reports to, among other things,
verify the calculation and accuracy of the Service Credits, if any, applicable to each
relevant Service Measurement Period.

5.9 Service Credits are a reduction of the amounts payable in respect of the Services and
do not include VAT. The Supplier shall set-off the value of any Service Credits
against the appropriate invoice in accordance with the Schedule 5.1 (Invoicing) of the
Call-Off Terms.

5.10 Nothing in this Appendix prevents or restricts a Critical Service Failure from arising
and affording the Customer the remedies available to it in the Call-Off Terms.
 5.11 The examples provided below do not contain actual Service Levels or values, and all
Service Levels should be taken from Part B of this Appendix.

Example Service Credit Calculation (1)

5.12 An example Service Credit regime for the Availability of a service is as follows:

Service Service
Minimum Maximum
Coefficient Level Failure
Service Service Service
(m) Target % Threshold %
Credit % (c) Credit % (d)
(a) (b)
Connectivity to
a Customer 5.0 99.5% 95.00% 2.5% 25%
Site
Table 3 Example Service Credits for Availability

5.13 The Service Credit regime is shown diagrammatically as follows:

5.14 The example Service Credit calculation set out in Paragraph 5.12 of this Part A is as
follows:

5.14.1 The Availability of the site telephony Service was recorded as ninety seven
percent (97%) for a Service Measurement Period. For this Service, the
Service Level Target is ninety nine point five percent (99.5%) and the Service
Failure Threshold is ninety five percent (95%). The Service Charge for the
Service Measurement Period is three thousand pounds (£3,000). Previous
performance had exceeded the Service Level Target for Availability.

5.14.2 In this example:

 Service Credit % = 5.0 x (99.5-97.0) + 2.5 = 15%

5.14.3 This Service Credit calculation is:

Service Credit (£) = Service Charge x Service Credit (%)

Service Credit (£) = £3,000 x 15% = £450

Example Service Credit Calculation (2)

5.15 An example of the Service Credit calculation for Incident Resolution is as follows:

5.15.1 Assume that the Customer has selected a Service Measure with the
following parameters:

Service
Service Failure Minimum Maximum
Coefficient Level
Service Threshold % Service Service Credit
(m) Target %
(b) Credit % (c) % (d)
(a)
All
0.25 95.0% 85.00% 2.5% 5%
services

Table 4 Example Service Credits for Incident Resolution

5.16 The Service Level Target is ninety five percent (95%) of all Incidents to be Resolved
within a specified time with the Service Failure Threshold being eighty five percent
(85%). Assume that the Customer has eighty (80) Incidents within a Service
Measurement Period, ten (10) of which were not resolved within the specified time.
Therefore, eighty seven point five percent (87.5%) of Incidents were resolved within
the Service Level Target. The Service Charge for all the Services that the Customer
is consuming is fifty thousand pounds (£50,000) per Service Measurement Period.
Previous performance had exceeded the Service Level Target for Incident Resolution
Times.

5.17 The Service Credit calculation is:

Service Credit (£) = Service Charge x Service Credit (%)

Service Credit (£) = £50,000 x 4.375% = £2,187.50

6. NATURE OF SERVICE CREDITS

6.1 The Supplier confirms that it has modelled the Service Credits and has taken them
into account in setting the level of the Charges. The Supplier agrees that the Service
Credits are a reasonable method of price adjustment to reflect poor performance in
breach of the required Service Level Target.

7. INCIDENT RESOLUTION SEVERITY LEVELS

7.1 For Incident Resolution the Service Level Targets apply to all the Services provided
to the Customer.

7.2 Incident Severity Levels are defined as follows:

Severity Description
Level

Severity An incident that is business critical (as defined in an agreed listing) relating to
1 business outcome, including but not limited to  financial impact, loss of service
to customers, regulatory or legal issue or impact on major project) and affects
all users within a department, users carrying out vital business tasks or any
critical site (as defined in Schedule of Premises).
Severity An incident that is business critical and affects a single department or non
2 critical site and either: 
A production system is significantly degraded
A production system function failed or is unavailable causing disruption to
business operations
Severity A fault that is business/mission critical and affects a single user.
3 User’s workstation, software or network services are unavailable to perform
critical work.
A fault that is not business/mission critical but affects a single department or
group of users. There is no workaround available.
Severity A fault that is not business/mission critical. User does not need function to
4 perform work tasks; or
User can continue to use function and therefore can continue to work; or
Any fault that does not fit into other Severity Levels.
Table 5 Incident Severity Levels

7.3 Incident Resolution Times shall be calculated from the first report to the Contractor’s
Service Desk until the action has been completed by or on behalf of the Contractor to
repair the root cause of the Incident or a Workaround has been implemented by the
Contractor.

7.4 The Incident is 'closed' once Service Restoration has been achieved. However, the
Contractor shall not close any Incident until the Customer has confirmed that Service
Restoration has in fact been achieved. Notwithstanding the foregoing, if the
Contractor has in fact achieved Service Restoration and has made three (3) attempts
in good faith to confirm this with the Customer, but has been unable to contact the
Customer to obtain this confirmation, the Incident will be closed.
PART B – SERVICE LEVELS AND KPIs

8. SHARED SERVICE LEVELS

8.1 The table below shows the Shared Service Level Targets and KPIs that shall be measured and reported on by the Supplier.

SLA Service Level Target Service Failure Threshold Min Max

Service Service
Credit Credit

Problem management 95% of Root cause identification to be 80% of Root cause identification to be 2.5% 10%
responsiveness and root cause complete within 10 days of Incident complete within 10 days of Incident
identification rates resolution for Severity 1 Incidents, resolution for Severity 1 Incidents

100% of Root cause identification to

Change management success rate
Service management service
reporting responsiveness
be complete within 30 days of Incident
resolution for Severity 1 Incidents
Technical changes: Over 98% of 90% of changes are successfully 5% 15%
changes are successfully implemented implemented
(everything that goes through CAB
approval)
100% of Service Management Service 100% of Service Management Service 2.5% 5%
Reporting pack provided to the Reporting pack provided to the
Customer within 5 days of the month Customer within 15 days of the month
end. end.

100% of Severity 1 Incidents within 24 5% 15%

Severity 1 incidents – 90% within 4hrs hrs
Incident Resolution (no clock-stop) 100% of Severity 2 Incidents within 24 5% 15%
Note that a clock stop will only be Severity 2 incidents – 90% within 8 hrs hrs
acceptable if it is due to customer Severity 3 incidents – 90% within 24 100% of Severity 3 Incidents within 3 2.5% 15%
feedback required, and will have to hrs business days
be approved by the Customer. Severity 4 incidents – 90% within 5 100% of Severity 4 Incidents within 30 2.5% 10%
business days business days
Repeat SLA failures No repeat of a failed SLA within the 3 repeat failures for a SLA within 6 Repeat Repeat
SLA Service Level Target Service Failure Threshold Min Max
Service Service
Credit Credit

failure failure
multiplier multiplier
*1.5 for 1st *2 for 3rd or
repeat, more
*1.75 for repeat
As defined in part A of this Appendix following 3 months months. 2nd repeat failure
95% accuracy of all assets that are
paid for by unit (e.g. laptops, mobiles,
desktops, RSA tokens).

The asset attributes to be included in

the accuracy calculation to be defined
and agreed in the Service Operations
Asset register accuracy manual
95% accuracy of all software licences.

The asset attributes to be included in

Software asset accuracy
Request fulfilment / request
management
Customer Satisfaction
the accuracy calculation to be defined
and agreed in the Service Operations
manual
95% of standard requests are
completed within the timescale set out
in the Service Operations Manual
a. At least 80% of Users providing
feedback in each month believe that
ICT support arrangements provided by
the Service Provider are rated ‘good’ or
‘better’
b. At least 95% of responses to the
Annual Survey in any one service year
state that the ICT support
arrangements are rated "good"
SLA Service Level Target Service Failure Threshold Min Max
Service Service
Credit Credit

where
 
a) Distribution of the Customer
Satisfaction survey to less than 8% of
the Customers user base using the IT
service for incidents and requests each
month, will constitute a failure of the
agreed Service Level Agreement
b) Distribution of the Customer
Satisfaction survey to less than 95% of
the overall Customers user base each
year will constitute a failure of the
agreed Service Level Agreement

9. SPECIFIC SERVICE LEVELS

9.1 The table below shows the Service Level Targets and KPIs that shall be measured and reported on by the Supplier, that are specific to the
Supplier.

SLA Service Level Target Service Failure Threshold Min Max

Service Service
Credit Credit

Service desk call answer rate 90% of calls answered within 30 80% of calls answered within 30 2.5% 10%
seconds (over a month) seconds
Service desk call abandonment rate Less than 5% abandoned after 30 Less that 10% abandoned after 30 5% 10%
seconds seconds
Service desk first time fix rate At least 95% of the previous months Minimum level of X% 5% 10%
result, no more than 2 periods of
decline
Notification of Severity 1 incidents Notification of 100% of Severity 1 Notification of 90% of Severity 1 5% 15%
SLA Service Level Target Service Failure Threshold Min Max
Service Service
Credit Credit

Incidents within 30 minutes of the

Note that this means the original
report time in the case of incident
escalation.
Notification of Severity 2 incidents
Note that this means the original
report time in the case of incident
escalation.
incident being reported.
Notification of 100% of Severity 2
Incidents within 30 minutes of the
incident being reported.
Incidents within 30 minutes of the
incident being reported.
2.5% 15%
Notification of 90% of Severity 2
Incidents within 30 minutes of the
incident being reported.