The On-Call Problem – Blog 3

visualization of a set of nodes in an application
The CFO Case for Fixing On-Call | Engineering Finance

The Number Your CFO Needs to See About On-Call

Engineering leaders know on-call is broken. Finance leaders don't know it costs $2–5M a year. Here's how to make the case — and what the ROI actually looks like.

DOWNTIME COST $5,600 / MIN
ALERT NOISE 67% FALSE POSITIVES
ATTRITION RISK 42% CITE ON-CALL
REPLACEMENT COST $310K / ENGINEER
PAYBACK PERIOD < 90 DAYS
POTENTIAL SAVINGS $958K – $2.5M / YR
DOWNTIME COST $5,600 / MIN
ALERT NOISE 67% FALSE POSITIVES
ATTRITION RISK 42% CITE ON-CALL
REPLACEMENT COST $310K / ENGINEER
PAYBACK PERIOD < 90 DAYS
POTENTIAL SAVINGS $958K – $2.5M / YR

Engineering leaders live inside this problem. They know which incidents repeat. They know which engineers are burning out. They know the rotation is two people short of sustainable.

What they often lack is the language to take it upstairs. "My team is exhausted" is a people problem. "We're spending $3M a year on a solvable infrastructure gap" is a business problem — and it gets a different kind of attention.

This is a guide to making that translation.

Build the Cost Stack First

Finance thinks in line items. The first step is converting on-call dysfunction into categories your CFO already tracks: downtime cost, labor cost, and attrition cost. Most organizations have never put these in a single spreadsheet.

Cost Category Annual Estimate
Direct downtime — 10 P1 incidents per year $500K – $2M
Engineer labor during incidents $200K – $500K
Productivity tax — 20% reduced output per engineer $400K
Alert fatigue and false-positive triage $100K – $150K
Recurring incidents — root causes unresolved $500K – $1M
Burnout-driven turnover — 1 to 2 engineers per year $260K – $620K
Total Annual On-Call Cost $2M – $4.7M

These numbers are conservative and based on a mid-size org with 10 on-call engineers. Two line items tend to land hardest with leadership: the productivity tax — which is invisible in most headcount models — and the turnover cost, which at $310K per engineer replacement represents a quiet eight-figure exposure over a three-year horizon.

"You're already spending $2–5M a year on this problem. The question is whether you keep paying it — or invest a fraction to fix it."

Then Show the Return

Once the cost stack is visible, the ROI case is straightforward. Conservative projections — 50% MTTR reduction, 30% fewer pages, one fewer engineer lost to burnout — generate savings that exceed typical solution costs within a single quarter.

Annual Savings Breakdown
50% MTTR reduction$250K – $1M
30% fewer pages$78K – $186K
1 engineer retained$130K – $310K
Recurring incidents resolved$500K – $1M
Bottom Line
$2.5M
Upper-bound annual savings
Conservative floor$958K / yr
Payback period< 90 days

The Metrics That Move the Room

Not all numbers land equally in executive conversations. In practice, three figures tend to shift the dynamic from "interesting" to "let's act on this."

Impact by Category — Relative Weight
Downtime cost
$500K–$2M
Recurring incidents
$500K–$1M
Attrition cost
$260K–$620K
Productivity tax
$400K
Incident labor
$200K–$500K

The productivity tax is often the surprise. Finance leaders who have modeled headcount carefully haven't accounted for the 20% output reduction that on-call engineers carry the day after a page — let alone the accumulated cost across a full rotation, quarter over quarter. Putting a dollar figure on it reframes the conversation entirely.

Framing It for the Room

The instinct is to present this as an engineering investment. Resist it. The framing that moves CFOs is operational risk reduction — a category they already track, budget for, and care about.

On-call dysfunction is a retention risk, a revenue risk (downtime), and a productivity drag. The solution isn't a new engineering tool — it's closing an operational exposure that's been accruing quietly for years.

Start with your own numbers. Pull 90 days of incident data. Calculate your actual downtime cost using Gartner's $5,600 per-minute benchmark. Estimate your rotation's productivity tax. Add one hypothetical turnover event. Most teams land well north of $1M before they've finished the spreadsheet.

That's the number to bring to the room. Not a vendor estimate — your number, built from your data. It's harder to argue with, and it anchors the conversation where it belongs: on the cost of doing nothing.

Contact Us

The first step toward a healthier on-call culture is a single conversation. Reach out to our team today and let's talk about what's possible for your organization. Contact the Arisant experts at 303-330-4065 or email us at polaris_monitoring@arisant.com

Polaris is a monitoring tool with self-healing capabilities that can augment or replace your current monitoring solution. Please reach out if you'd like additional information.

This analysis draws on industry research from Gartner, PagerDuty, and first-party incident data. Cost estimates reflect conservative projections for a mid-size technology organization operating with 10 on-call engineers.

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