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  • Project name – Providing SLA-backed support
  • Author – Jan Kratochvíl
  • Software used – Simprocess
  • Simulation type – Queues theory


A software firm recently developed a new facing custom solution for one of the major banking institutions. The solution is critical to the bank’s operations. Therefore the bank decided to pay for support from the solution developer and has signed a Service Level Assurance agreement. The agreement defines several levels of incidents:

Incident Severity Hotfix time (hours) Resolution time (hours) Penalty (per hour)
Standard 16 72 100 EUR
Severe 8 32 400 EUR
Critical 2 16 1000 EUR
  • Hotfix – A fix to the problem that can be temporary and does not have to address the root issue. Can be deployed out-of-band directly by a developer, does not include testing
  • Resolution – Fixes a root cause of the problem, deployed as part of the daily build. Needs to go through a testing phase

The solution firm has the following resources types:

Resource Type Price per MD (Man-day)
Junior Developer 280 EUR
Standard Developer 300 EUR
Senior Developer 350 EUR
  • The number of resources deployed on support is fixed for a month, since the training of new resources for the project is expensive due to the project complexity
  • The cost of resources is paid regardless of the resource’s utilization rate (the company internally uses cost accounting methods)
  • Each resource type has a different level of efficiency when performing tasks (main task types are - development, testing). The exact coefficients will estimated as part of the task solution


The banked asked the solution developer to price the SLA contract and provide a reasoning for the pricing.

The software firm decided to simulate a month-log support cycle to estimate the internal costs for upholding the support contract which it will use as a basis for pricing the SLA contract. The software firm will use data about incident frequency and severity obtained on a different project of a similar scope and client profile.

The goals of the software firm are to maximize profit and to minimize the resolution time for critical incident, since the firm knows, that a larger number of overdue critical fixes would cause the bank to be unsatisfied over the long term.

The goals can be summed up as follows:

  • Bank – minimize SLA contract price, prevent long incident hotfix and resolution times
  • Software firm – maximize revenue from SLA contract, prevent overstaffing and long critical resolution times

Jan Kratochvíl 18:17, 19 December 2014 (CET)~

I must confess I am usually quite sceptical to the assignments like this one for a couple of reasons. First, it is very hard to measure such soft parameters like "psysical attraction" and keep it in touch with reality. Second, I am not sure if a random walk is the best way how to simulate people searching for a partner. And finally, do the goals solve a real problem or they just follow an artificial reality of the simulation? - Tomáš 00:26, 20 December 2014 (CET)

I agree with your objections. Therefore I've defined a different task, one which is more in my area of expertise :-). As for the resource types efficiency, I feel that I can estimate them well since I have similar data available to me. What do you think? - Jan Kratochvíl 10:30, 22 December 2014 (CET)~

Ok, approved. Perhaps, a full version of Simprocess could be needed. In that case, it should be available at SB207. Tomáš 22:34, 23 December 2014 (CET) -10 points for late assignment