Why Sales and Marketing Need an SLA and How to Make One That Works

In our last article, we discussed how misalignment between the Sales and Marketing teams is one of the major causes of a poorly functioning funnel. A funnel that doesn’t work costs your company revenue, time, and team morale. As the founder of an emerging tech services firm, overcoming this challenge is one of your key responsibilities — and a Service Level Agreement between sales and marketing might help you do just that. 

Why You Need an SLA

SLAs aren’t just for clients. Many ETS organizations find an internal SLA between teams within the same department, or even within the same cross-functional team, helpful. These provide a structured framework that defines and aligns the efforts of both teams towards a mutual goal and builds accountability into their collaboration. 

Create Culture

When in doubt, write it down. We’ve talked before about the importance of a culture of writing in an ETS organization. Documentation always helps. When roles, thought processes, expectations, and timelines are documented, they become real. This documentation also serves as a point of reference to revisit later, helping teams improve, reflect, and take more intentional action. 

Mutual Accountability

Cut through the finger-pointing that often arises in groups. An SLA is also a great way to eliminate the bystander effect. It delineates clear responsibilities and obligations each team has towards the other, which both teams agree to. This is a critical part of building mutual accountability.

Bring Clarity

SLAs eliminate ambiguities and preempt miscommunication by ensuring that sales and marketing talk about the same things and use the same definitions. It also gives both teams clear targets with respect to each other. You can define handover points in the SLA alongside things such as the definition of a Marketing-qualified or Sales-qualified lead, the target criteria, and the timeframe for Sales teams to engage in things such as follow-ups with MQLs.

Better Experiments

An SLA is a great first step towards running better experiments to optimize your funnel. It aligns both teams on the basics, making sure they’re on the same page about things such as targeting, lead criteria, and follow-up times. Once these things are consistent, you have a baseline state. You can then begin tweaking different parts (one variable at a time) to better isolate the impact of each change across the funnel and obtain high-quality data for decision-making.

Creating an SLA that Works

An SLA can sound intimidating, but it doesn’t have to. You can take a step-by-step approach to building an SLA that actually works.

1. Look at the Customer Journey

Your first step is to understand the landscape. This means getting a deeper grasp of your customer’s journey through the funnel you currently have, how well that matches what you already know about their pain points or decision process, and what your team's interactions with them look like throughout this journey. Map out this journey and identify the critical transition points where alignment is essential.

2. Identify Problems & Needs

Take another look at the journey you mapped out in Step 1. What are your current expectations for how customers move through it? Where are those expectations being met, and where are they failing? Remember to also talk to both teams. Where are things breaking down? Are leads being ignored? Is feedback not making it back to marketing? Keep your findings grounded in actual challenges, not assumptions. 

But also look beyond just the mechanics of lead handoff. How are each team’s success metrics defined? Identify mismatches in incentives or team culture and resolve them. Your findings at this step directly contribute to critical components of an SLA, including the shared goals and requirements it documents.

3. Create the Agreement

Time to write it down. Create definitions of critical terms, such as qualification criteria or your ICP, based on your ETS company’s strategy and positioning. Using your findings from Step 1 and Step 2, define the specific commitments each team is making. For example, this can be the number of qualified leads Marketing delivers each week or the time Sales takes to reach out to them. These commitments become performance standards that each team is accountable for delivering to the other. They are also helpful to revisit later on.

4. Don’t Skip the Essentials

A typical internal SLA should include goals, role definitions (especially for points of contact between the teams, but you can include situation-specific roles too), communication channels (how teams share updates, feedback, and issues), and contingency plans (what happens if goals aren’t met—course correction, not punishment). You can add supporting information, including your findings from earlier steps, but your SLA won’t be effective without the essentials.

5. Take Baby Steps

Remember to start small. You can’t fix everything overnight, especially a problem such as team friction. People need time to build new habits, and teams need time to build the trust that's fundamental to productive collaboration. Focus on incremental improvements and prioritize what to tackle first. Don’t overwhelm your teams with changes. One of the most common problems with creating an internal SLA isn’t a lack of thoroughness — it’s adoption. If nobody adheres to your comprehensive, meticulously detailed SLA, then it doesn’t help anyone.

6. Review Regularly

One of the most frequent lines of advice we give founders setting up virtually anything in their ETS companies is to review things regularly. Anything worth doing is worth reviewing. Set up regular check-ins to review performance, identify roadblocks, and refine the SLA as your understanding of your funnels and your teams’ capabilities grows. Treat this SLA as a living document that evolves with your business.

Wrapping Up

An SLA between Sales and Marketing is a strategic move for alignment, efficiency, and growth. While just the act of creating an SLA itself benefits your company by nurturing a culture of documentation, clarifying expectations, and encouraging mutual accountability, its implementation reduces friction in your revenue pipeline and unlocks the full potential of both teams. Focus on sustainable change instead of sweeping change, and you’ll have a solid foundation to scale the collaboration between your sales and marketing teams as your company grows.

A Gift for You 🎁

At Vixul, we spend a large part of our time reviewing the forecasts created by the founders of our portfolio companies. It is amazing for us to see our founders mature as executives and be able to answer questions they couldn't in the past. Unfortunately, most founders struggle with these issues until we point them in the right direction. We believe the lack of guidance on forecasting is a primary issue for early-stage tech services founders.

That's why we're working on an eBook with detailed instructions on how to set up forecasts for sales pipelines. This will help you plan your new year with better foresight. The book will be free for people on our mailing list when it is published, so please subscribe now to ensure you receive it.