What does a 'service level agreement' (SLA) establish?

A service level agreement (SLA) is fundamentally a formal agreement that delineates the expected level of service between a service provider and the customer. It specifies clear metrics for measuring service effectiveness and defines the responsibilities of both parties. This critical document serves to set mutual expectations, ensuring that customers understand what they can anticipate in terms of service quality, performance, and availability, while also providing the service provider with a framework to deliver on those commitments.

This clarity helps in reducing misunderstandings and provides a benchmark against which the service can be evaluated. Unlike a contract covering all possible service issues, which may be too broad and complex to be functional, or an informal understanding that lacks legal enforceability and specificity, the SLA is structured and detailed. It can also differ from a mere guideline for customer interactions, which may not encompass the technical and operational aspects of service delivery that an SLA firmly establishes. Thus, option C accurately describes the essence and purpose of a service level agreement in ITIL 4 practices.