Understanding SLAs in Dynamics 365 Customer Service

Customer expectations are higher than ever, and delivering excellent service is no longer optional. According to a study by Bain & Company, customers facing service issues are four times more likely to switch to a competitor. Supporting this, research by Qualtrics and ServiceNow shows that 80% of customers have switched brands due to poor experiences. Ensuring timely and consistent support within such competition can make all the difference in keeping customer loyalty.

This is where Service Level Agreements (SLAs) come into play. Within Dynamics 365 Customer Service, SLAs serve as clear commitments between your business and your customers, defining how quickly cases should be addressed and resolved. By automating SLA tracking, sending alerts for potential breaches, and generating detailed performance reports, Dynamics 365 empowers your team to deliver on these promises consistently.

In this blog, we will explore the vital role SLAs play in Dynamics 365 Customer Service, break down their core components, and guide you in configuring and monitoring them to boost customer satisfaction and operational efficiency.

What are SLAs in Dynamics 365?

Service Level Agreements (SLAs) in Dynamics 365 are formal contracts that define the expected standard of service between a service provider and their customers. Essentially, an SLA sets clear expectations by specifying the minimum response times and resolution periods for issues once they are reported. This agreement helps ensure transparency, both for the customer and the service team, about when a case should be addressed and resolved.

SLAs play a crucial role in maintaining consistency in service delivery. By enforcing agreed-upon timelines, they help service organizations measure their performance and keep customers informed about the progress of their requests.

For example, different customer tiers may have varying SLA levels: a VIP customer might require a response within one hour and resolution within four hours, while a standard customer could have a response time of four hours and resolution within 24 hours. This tiered approach allows businesses to prioritize resources effectively and align service quality with customer value.

By incorporating SLAs in Dynamics 365, companies can automate tracking, send timely alerts for potential breaches, and generate performance reports, all of which contribute to delivering reliable and transparent customer service.

Now that we know what SLAs are and why they matter, let’s dive into the core components that power SLAs in Dynamics 365 Customer Service.

Core Components of SLAs in Dynamics 365 Customer Service

SLAs in Dynamics 365 function through a combination of SLA KPIs (Key Performance Indicators), SLA items, and SLA KPIs’ applicable conditions. These components work together to ensure consistent and efficient service delivery. Below is an in-depth exploration of each core element:

• SLA Items (SLA KPIs): SLA Items, also known as SLA Key Performance Indicators (KPIs), are specific metrics that define the expected response and resolution times for customer cases. Each SLA Item is associated with a particular KPI, such as “First Response Time” or “Resolve By Time.” These KPIs are critical in measuring the performance of customer service operations and ensuring that service commitments are met.

• SLA KPI Metrics: These metrics track the actual time taken to meet the targets set in SLA Items. For instance, if an SLA Item specifies a first response within 2 hours, the SLA KPI Metric measures whether this target was achieved. Monitoring these metrics helps in assessing the efficiency and effectiveness of the service team.

• Success and Failure Actions: Dynamics 365 allows the configuration of actions that occur when an SLA Item is either met (success) or violated (failure). Success actions might include sending a confirmation email to the customer or updating the case status to “Resolved.” Failure actions could involve escalating the case to a supervisor or notifying the customer of the delay. These automated actions ensure timely responses and maintain service quality.

• Pause and Resume Conditions: Enhanced SLAs in Dynamics 365 support the pausing and resumption of SLA timers under specific conditions. For example, SLAs can be paused when a case is awaiting customer feedback or during non-business hours. This feature ensures that SLAs are not unfairly penalized for delays beyond the service team’s control. Configurations can be set at the SLA KPI and SLA Item levels, providing flexibility in managing pause conditions.

• Applicable Entity and Conditions: SLAs are applied to specific entities, typically the Case entity, but can also be configured for other service-related records. Conditions determine when an SLA should be applied, based on case attributes such as priority, customer tier, or issue type. This targeted application ensures that SLAs align with business priorities and customer expectations.

• SLA KPI Instances: When an SLA is applied to a case, Dynamics 365 creates an SLA KPI Instance. This instance tracks the progress of the SLA for that specific case, recording timestamps, elapsed times, and compliance status. SLA KPI Instances provide detailed insights into individual case performance and are essential for reporting and analysis.

• Integration with Dashboards and Analytics: SLA data is integrated into Dynamics 365 dashboards and reporting tools, such as Power BI. This integration allows service managers to monitor SLA compliance in real-time, identify trends, and make data-driven decisions to improve service delivery. Visualizations and analytics help pinpoint areas for improvement and optimize resource allocation.

By understanding and effectively configuring these core components, organizations can leverage SLAs in Dynamics 365 Customer Service to enhance operational efficiency, meet customer expectations, and drive continuous improvement in service delivery.

With these components in place, understanding how SLAs operate day-to-day within Dynamics 365 is key to enforcing service quality.

How SLAs Work in Dynamics 365 Customer Service

Understanding the operational flow of SLAs in Dynamics 365 Customer Service is essential for enforcing service commitments and improving customer satisfaction. Here’s a step-by-step overview of how SLAs function within the system:

1. SLA Assignment to Cases

• Automatic Assignment: SLAs are automatically applied to cases based on predefined rules such as case priority, customer type, or issue category.
• Manual Assignment: Service agents or supervisors can manually assign or update SLAs on specific cases as needed.
  
  

2. SLA Timer Initiation: Once an SLA is assigned, timers start tracking the time from the moment the case is created or reaches a defined status. Timers monitor key metrics like response time (how quickly an agent acknowledges the case) and resolution time (how long it takes to resolve the issue).
   
   
3. Pause and Resume Timers: SLA timers can be paused under certain conditions, such as when the case status changes to “Waiting for Customer.” Timers resume once the case status returns to active, ensuring service time measurements are fair and only count working time.
   
   
4. Real-Time Monitoring and Alerts: The system continuously monitors SLA progress and elapsed time. Automated alerts notify agents and managers as SLA deadlines approach, helping them prioritize work and prevent breaches.
   
   
5. SLA Breach Handling and Escalations: If an SLA target is missed, Dynamics 365 can trigger escalation rules to notify higher-level support or initiate corrective workflows. Escalations help ensure timely resolution and maintain service quality.
   
   
6. Tracking SLA Status: Each case has a real-time SLA status indicator showing whether it is compliant, nearing breach, or breached. This transparency aids agents in managing their workload effectively.
   
   
7. Reporting and Analysis: SLA data is aggregated into dashboards and reports accessible to managers. These analytics provide insights into compliance trends, team performance, and areas for improvement.
   
   

Also read: How can you upgrade from Dynamics AX 2012 to MS Dynamics 365?

Having seen how SLAs actively manage your service commitments, let’s dive into the specific features you can configure to customize SLAs for your unique business needs.

Configuring SLAs and KPIs in Microsoft Dynamics 365 Service

Service Level Agreements (SLAs) and Key Performance Indicators (KPIs) are essential for ensuring timely and efficient customer service in Microsoft Dynamics 365. Here’s a structured guide to setting them up:

1. Enable Entities for SLAs

Before configuring SLAs, ensure that the relevant entities are enabled for SLA tracking:

• Access Power Apps: Navigate to make.powerapps.com.
• Select Environment: Choose the appropriate environment.
• Go to Solutions: Under Solutions, select Default Solution.
• Choose Entity: From Tables, select the entity you wish to enable for SLAs (e.g., Case, Account).
• Edit Table Properties: In the Table Properties section, click on Properties.
• Enable SLA: Under Advanced Options, check the box for Setting up service level agreements.
• Save and Publish: Click Save, then Publish All Customizations.

Note: SLAs can be enabled for a maximum of seven entities. It’s recommended to have no more than five SLA KPIs per entity and fewer than 15 SLA items per entity.

2. Configure SLA Settings

• Navigate to Customer Service Admin Center: Go to Operations > Service Terms > Other SLA Settings.
• Recalculate SLAs: Set Recalculate SLAs on terminal status to Yes to ensure SLAs are recalculated when a case reaches a terminal status.
• Define Pause Statuses: Select the status values (e.g., “On Hold”, “ReSearching”) for which SLA calculations should be paused.
• Automatic Entitlement Application: Decide whether to automatically apply the default customer entitlement when a case is created or updated.

3. Create SLA KPIs

• Access SLA KPIs: In the Customer Service Admin Center, navigate to Operations > Service Terms > SLA KPIs.
• Create New KPI: Click on New to create a new SLA KPI.
• Define KPI: Provide a name (e.g., “First Response By”) and associate it with the relevant entity (e.g., Case).
• Set KPI Details: Define the target metric (e.g., “Respond to high-priority cases within 1 hour”).
• Activate KPI: Ensure the KPI is activated to be used in SLAs.

4. Create SLA Items

• Navigate to SLAs: Go to Operations > Service Terms > Service-level agreements (SLAs).
• Create New SLA: Click on New to create a new SLA.
• Define SLA: Provide a name (e.g., “Customer Support SLA”) and associate it with the relevant entity.
• Add SLA Items: Under the SLA record, add SLA Items that correspond to each KPI.
  • Define SLA Item: For each item, specify:
    • SLA KPI: The KPI measures.
    • Failure After: The duration after which the SLA is considered breached if the target isn’t met.
    • Warning Before: The duration before the breach when a warning should be triggered.
      
      
• Configure Actions: Set up actions for success, warning, and failure scenarios using Power Automate. For example:
  • Success: Update the case status to “Resolved”.
  • Warning: Send an email notification to the assigned agent.
  • Failure: Escalate the case to a supervisor.
    
    

5. Add SLA Timers to Case Form

• Access Case Form: Navigate to the Case entity and open the main form.
• Add Section: Create a new section named “SLA Timers”.
• Add Subgrid: Within the new section, add a subgrid that displays related records from the SLA KPI Instances table.
• Configure Subgrid: Set the subgrid to show the default view of all SLA KPI Instances.
• Enable SLA Timer Control: Ensure that the SLA Timer control is enabled to display SLA timers on the form.

6. Monitor SLA Performance

• Track SLA KPI Instances: Each case associated with an SLA generates SLA KPI Instance records that track the progress and compliance status of each SLA item.
• Create Triggers: Set up automated triggers based on SLA KPI Instance statuses. For example:
  • Success: When an SLA item is marked as succeeded, update the case status to “Resolved”.
  • Warning: When an SLA item is nearing breach, send an email notification to the assigned agent.
  • Failure: When an SLA item is breached, escalate the case to a supervisor.
    
    
• View SLA Performance: Add the SLA KPI Instance control to the case form to provide agents with real-time visibility into SLA statuses and timers.

Also check out: Microsoft Dynamics 365- Your steering to drive customer engagement success.

Proper holidays and working hours scheduling ensure SLA timers reflect your organization’s actual service availability.

Holiday and Customer Service Schedules in Dynamics 365 Customer Service

Managing holidays and service schedules is crucial for accurate SLA tracking and ensuring realistic service commitments. Dynamics 365 Customer Service offers robust features to define business hours and holidays, allowing SLAs to pause during non-working periods, which helps prevent unfair SLA breaches.

Creating a Holiday Schedule

A holiday schedule defines specific dates when your organization is closed, ensuring that SLA timers pause during these periods.

Steps to Create a Holiday Schedule:

1. Access the Copilot Service Admin Center:
   • Navigate to the Copilot Service Admin Center.
   • In the site map, select Calendar under Operations.
     
     
2. Manage Holiday Schedules:
   • In the Holiday calendar section, click on Manage.
   • The All Holiday Schedules view will appear.
     
     
3. Create a New Holiday Schedule:
   • Click on New.
   • In the Create Holiday Schedule dialog box, enter a name (e.g., “Company Holidays”) and description for the holiday schedule.
   • Click Create.
     
     
4. Add Holidays:
   • Once the holiday schedule is created, select it from the list.
   • In the Holidays grid, click on New to add a holiday.
   • In the Add Holiday dialog box, specify the Name, Start Date, End Date, and Duration of the holiday.
   • Click OK to save.
     
     

By associating this holiday schedule with your customer service schedule, SLA timers will pause during these defined holidays.

Creating a Customer Service Schedule

A customer service schedule defines your organization’s working hours and weekly off days, which are used to calculate SLA timers.

Steps to Create a Customer Service Schedule:

1. Access the Copilot Service Admin Center:
   • Navigate to the Copilot Service Admin Center.
   • In the site map, select Calendar under Operations.
     
     
2. Manage Customer Service Schedules:
   • In the Customer service calendar section, click on Manage.
   • The All Customer Service Calendars view will appear.
     
     
3. Create a New Schedule:
   • Click on New.
   • In the Create Customer Service Schedule dialog box, enter a name (e.g., “APAC Support Hours”) and description for the schedule.
   • Click Create.
     
     
4. Define Work Hours:
   • In the Weekly Schedule dialog:
     • Select the same each day or Vary by day based on your organization’s needs.
     • If selecting Are the same each day, click on Set Work Hours to define the start and end times for each day.
     • If selecting Vary by day, specify the work hours for each day individually.
       
       
5. Define Weekly Off Days:
   • Specify the days of the week your organization is closed (e.g., weekends).
     
     
6. Associate Holiday Schedule:
   • Under the Holiday Schedule section, select Observe and choose the holiday schedule you created earlier.
   • This ensures that SLA timers pause during holidays.
     
     
7. Save the Schedule:
   • Click Save and Close to finalize the customer service schedule.
     
     

By associating this customer service schedule with your SLAs, you ensure that SLA timers respect your organization’s working hours and holidays.

Finally, continuous monitoring of SLA performance helps keep service delivery on track and drives ongoing improvements.

Monitoring and Managing SLA Performance

Dynamics 365 provides several tools to help service managers track SLA adherence:

• Dashboards and Reports: Real-time dashboards display SLA compliance metrics across teams, customers, and case types.

• Alerts and Escalations: Automated alerts notify users before SLA breaches, enabling proactive intervention.

• SLA KPIs on Case Forms: Agents can view SLA status directly on case records, helping prioritize work effectively.

• Historical Analytics: Review SLA trends over time to identify bottlenecks and areas for improvement.

Conclusion

When your customers rely on you, meeting your service commitments is essential. SLAs in Dynamics 365 Customer Service give you the tools to keep those promises visible and manageable. But having the right tools isn’t enough, and you need experienced partners who understand the challenges and can help you implement and maintain SLAs that actually work for your business.

That’s where WaferWire steps in. With deep expertise and hands-on support, we help you stay on top of your service goals, avoid costly mistakes, and build stronger relationships with your customers.

Why Choose WaferWire?

• End-to-End Implementation Support: From initial planning to deployment, we assist in setting up SLAs aligned with your business processes, including data migration and environment readiness.

• Customization & Configuration: We tailor SLA rules, escalation paths, and notifications to fit your specific customer service requirements, improving case resolution and compliance.

• System Integration: We ensure your SLA processes seamlessly connect with other Microsoft tools like Power Automate and Power BI, enabling automation and real-time performance insights.

• Ongoing Maintenance & Technical Support: Our global support team monitors SLA performance, troubleshoots issues, and applies updates to keep your system reliable and efficient.

• User Training & Adoption: We provide role-based training on SLA management and reporting to ensure your teams effectively use the system and meet service commitments.

• Change Management Support: We help you manage organizational change, facilitating smooth SLA process adoption and minimizing disruption.

• Security & Compliance Support: We assist in implementing role-based access controls and aligning your SLA data management with industry standards such as GDPR and HIPAA.

Ready to make your service levels more than just words? Reach out to WaferWire and let’s get started.