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Service Levels – Quantifying Business Objectives

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County Sanitation District 1 (CSD-1) provides wastewater collection services to the greater Sacramento, California, area. When CSD-1 began working with Hunter Water Australia to develop a new Asset Management program, we realized that no clear requirements or expectations existed for the services CSD-1 provides its customers. How could we run a customer service business successfully without fully understanding the services provided to the customer? CSD-1 grappled with this question and began embarking on service level agreements with its customers. With help from Hunter Water Australia, CSD-1 identified core business objectives and turned them into service levels, which are essentially contracts with customers.

In 2005, as CSD-1 began tracking, reporting, and posting service levels, we realized that the impact of service levels on business was substantial. Service levels became our core business focus. Although requiring much educating and convincing, management and staff began to understand both the critical impact of service levels and also their role in meeting service level goals at the least cost to the customer.

Although tracking performance to try to improve was a good start, it was only the beginning. Establishing targets for service levels became the next step. CSD-1 identified three service levels for which to establish targets. A target establishes a particular level of service. We needed to understand that it might not be cost effective to apply more resources to increase a service level already exceeding the target. On the other hand, CSD-1 is obligated to increase its level of service if the target is not being met. By using service level agreement principles, CSD-1 is confident its customers will be given the service they expect at a rate they are willing to pay. This paper discusses the initial set-up of service levels, the evolution of these service levels, evidence of success, lessons learned, and our next steps.
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Document Type: Research Article

Publication date: 01 January 2008

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