Chief Executive Insights

The Importance of XLAs and Experience Management to CEOs

As a CEO, the term “XLAs” – short for eXperience level agreements – might look like a consultant-created buzzword that’s been designed to suck even more money, in the form of advisory fees, from your company. However, the use of XLAs – through improving the employee experience and productivity in particular – provides a proactive means through which to drive up operational efficiency and to improve outcomes. Making XLAs and experience management a key component of every CEO’s arsenal – in helping them to ensure that the corporate IT department, or outsourced IT service provider, is effectively supporting business needs.

How well is your corporate IT capability really doing?

No matter if your IT is provided in-house or outsourced, how often do members of your C-team bring up their IT service and support “horror stories” despite the monthly IT reporting pack consistently showing that the agreed-on service-level targets are being met, perhaps even exceeded? Something just doesn’t add up.

The cause is usually that the best-practice IT metrics commonly employed by IT organizations  – and the associated service level targets – measure how activities are being done, operationally, rather than assessing the delivered outcomes in business terms and the experiences of the people involved. They’re measuring the “mechanics” of IT service delivery and support, not the value of IT capabilities to business operations and results.

This is why CEOs and their CIOs are adopting XLAs – to better know how well the internal, or external, IT service provider (and their services) are meeting business and employee needs. Then to make data-driven decisions on the improvements that will close the expectation gap between IT demand and supply in the areas that matter most.

Why XLAs need to be in your CEO arsenal

Playing Devil’s Advocate for a moment, you might think that your IT service provider already has too many performance metrics. This is usually the case for many IT service providers.

However, XLAs are a different flavor of metric. Their introduction isn’t designed to measure even more performance-based data points. Instead, XLAs are focused on measuring the right things, in the right places, and then ensuring that the investments in improvement activities address what matters most.

This distinction is important, and for both traditional service level agreements (SLAs) and XLAs, because only measuring performance to validate that agreed-on targets have been met misunderstands a key purpose of metrics – the facilitation of improvement.

Are you confident that your IT service provider measures and reports the right things? 

As already mentioned, the monthly IT reporting pack might show that the IT service provider is performing well against agreed targets, but why the horror stories and potentially employee dissatisfaction with the services and support they receive?

Take, for example, an outsourced IT service desk that saves its customers money, employs industry best practices for IT service management (ITSM), and removes the customers’ need to provide an internal support capability. It should be great but is it really meeting the needs of its customers’ employees? While the key performance indicators (KPIs) show that all is good, your company’s employees don’t feel that they’re being sufficiently enabled – that things aren’t as they need to be, with a negative impact on their productivity and the business outcomes they contribute to.

Unlike with XLAs and experience management, traditional SLAs and metrics are often blind to these issues and their adverse impact.

The importance of employee experience in XLAs

Employee experience and employee experience management are key to achieving XLA success. Your CIO, or outsourced account manager, might argue that the measurement of customer satisfaction (CSAT) suffices but, as with the other “green” KPIs, CSAT feedback – because of what it asks and how – it doesn’t unearth what employees really feel about the services and support they receive. Many companies moved from CSAT questionnaires to measuring net promoter score (NPS) for customers during the last decade, this is a similar concept for employees. With CSAT more likely to inquire about the operational “mechanics” of IT support, say, than how employees feel about their experience with IT.

XLAs and experience-based metrics instead allow you and your CIO to better see what’s happening – both good, neutral, and bad – at the key touchpoints employees have with IT. It helps to identify issues (and which are most important) and to drive improvement to operations, services, and outcomes in the right places – addressing the underlying root causes of the issues rather than the visible symptoms.

The benefits of XLAs for CEOs

Right now, like every other CEO, you likely need your IT capabilities and the business outcomes they deliver to be “better, faster, and cheaper.” Traditional IT strategies will help – for example, the addition of extra automation – but how well are these strategies working at a business, rather than an IT, level? For instance, automation might deliver the required reduction in incident handling costs but what is the impact on employees? Are they more productive or less productive because of these improved capabilities?

Experience data provides much-needed insight into the business-level impact of any IT changes (plus the status quo) and, importantly, they allow your CIO to take the actions necessary to improve things. For example, your company’s investment in IT self-service might not currently be delivering the benefits it promised – as shown by the aggregated HappySignals customer data below:

Employee Lost Productivity – IT Issues
Employee Lost Productivity – IT Issues | Source: HappySignals, The Global IT Experience Benchmark H1/2021

That, while the telephone channel is perceived to lose employees an average of two hours per IT issue, the use of the self-service portal channel causes close to double this – i.e. four hours of lost productivity.

It’s the ability to access valuable, experience-based insights such as this – and the root causes – that allows your CIO and their teams to provide better IT service delivery and support capabilities to your employees. Commonly issues that they’re blind to when only using traditional, operations-based performance metrics.

Ultimately, the use of experience management and XLA will allow your CIO to:

  • Demonstrate the business value of IT
  • Make better data-driven decisions and eliminate the need for “gut feelings”
  • Drive continual improvement in the right places
  • Better manage their outsourced partners
  • Focus the IT organization/capability on developing in areas that improve business outcomes and value.

Hopefully, the above has you curious about how XLAs and employee experience management will help your company to improve both its operations and business outcomes. If you would like to find out more, then please contact us at www.happysignals.com

Written by Sami Kallio.

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Sami Kallio
Sami Kallio, Chief Executive Officer at HappySignals Ltd. HappySignals is an Employee Experience Management Platform for IT that makes experience data visible, understandable, and connected to operational data in IT, enabling enterprises to change their culture to be more open, outcome-focused, and data-driven.


Sami Kallio is an opinion columnist for the CEOWORLD magazine. You can follow him on LinkedIn.