An alarm is a notification in response to a selected condition or event for an object in the vCenter Server inventory. There are many predefined alarms for most objects within the vCenter Server inventory. The predefined alarms are configurable to an extent, but if the alarm doesn't address a specific event or condition that you want to monitor, then a custom alarm can be defined.
Custom alarms can be created as either condition-based or event-based. Condition-based alarms monitor the current condition or state of an object whereas event-based alarms monitor events that occur within vCenter.
Some examples of condition-based alarms include:
An ESXi host gets disconnected from vCenter
A virtual machine is using 90 percent of its total memory
A datastore's total space is 85 percent provisioned
Some examples of event-based alarms include:
A vSphere license has expired
SSH was enabled on an ESXi host
A virtual machine was migrated
What you are trying to monitor will dictate which type of alarm...