Chapter 21 - Performance-Based Contracting and Service Level Agreements

Always manage and monitor the supplier’s performance. Management starts with the performance and incentives structure. It is recommended that an agency maintain a team-based management approach to PBC and develop a structured means and capacity for collecting, analyzing, validating and reporting performance information in accordance with the contract’s requirements. An agency may obtain an objective third-party independent validation and verification (IV&V) resource for this purpose, if so stated in the solicitation.

When changes occur be sure to follow documented change management procedures, including any SLA revisions, from the kick-off meeting, through the transition period and roll-out. The agency should benchmark and compare while continuously pushing the supplier for improvement and savings and/or exercising the established corrective action and escalation mechanisms when the supplier’s performance is non-conforming.

For more information how to develop service level agreements (SLAs) for the procurement of IT goods and services, please see the Performance Metrics Tool here: https://www.vita.virginia.gov/procurement/policies--procedures/procurement-tools/