In the technology and IT operations world, incidents are bound to happen. Even the most reputable companies with top-notch talent and advanced systems experience downtime at some point. Take, for example, Apple, Delta, and Facebook, all of which have incurred significant financial losses due to incidents in recent years. These occurrences emphasize the fact that no company can promise 100% uptime, which is why Service Level Agreements (SLAs) should never set such unrealistic expectations.

To account for the inevitable downtime, industry experts recommend the concept of an “error budget.” An error budget refers to the maximum amount of time a technical system can fail without any contractual consequences. By understanding and utilizing error budgets effectively, tech teams can strike a balance between minimizing incidents, meeting SLA commitments, and fostering innovation.

What is an Error Budget?

An error budget is the allocated time that a system can be down or experience failures without triggering any consequences outlined in the SLA2. The specific duration of an error budget depends on the SLA’s uptime commitment. For instance, if the SLA promises 99.99% uptime, the error budget would be approximately 52 minutes and 35 seconds per year. Similarly, an SLA commitment of 99.95% uptime would allow for a four-hour, 22-minute, and 48-second error budget2. Tech teams can utilize this error budget to their advantage, allowing them to take calculated risks and drive innovation.

The Significance of Error Budgets for Tech Teams

While error budgets may initially seem like just another metric to track, they hold immense value for tech teams. Error budgets provide an opportunity for development teams to experiment, innovate, and take risks within acceptable limits. Rather than constantly surpassing uptime goals and setting unrealistic user expectations, teams can leverage the error budget to introduce new features and updates when the product is running smoothly.

The concept of error budgets also facilitates collaboration between development and operations teams. Developers focused on innovation and agility, can continue pushing changes as long as the downtime remains low. Operations teams, on the other hand, prioritize stability and security and have a vested interest in minimizing errors. As long as the error budget is not exceeded, the development team can maintain agility and drive innovation without friction from operations.

Utilizing Error Budgets Effectively

To make the most of error budgets, tech teams need to have a clear understanding of their SLAs and SLOs (Service Level Objectives). SLAs and SLOs define the objectives and promises made to clients in terms of uptime and successful system requests. These commitments form the basis for calculating the error budget.

Error Budgets Based on Uptime

Most teams monitor uptime on a monthly basis. If the availability exceeds the SLA/SLO target, the team can utilize the error budget to release new features and take risks. However, if the uptime falls below the target, any new releases are halted until the uptime numbers are back on track.

To effectively use this method, the SLA target must be translated into tangible figures that developers can work with. This involves calculating the actual time duration that corresponds to the allowed downtime percentage. Common targets and their corresponding downtime durations are as follows:

SLA TargetYearly Allowed DowntimeMonthly Allowed Downtime
99.99%52 minutes, 35 seconds4 minutes, 23 seconds
99.95%4 hours, 22 minutes, 48 seconds21 minutes, 54 seconds
99.9%8 hours, 45 minutes, 57 seconds43 minutes, 50 seconds
99.5%43 hours, 49 minutes, 45 seconds3 hours, 39 minutes
99%87 hours, 39 minutes7 hours, 18 minutes

Error Budgets Based on Successful Requests

SLOs, unlike SLAs, focus on specific metrics and their performance. To avoid complexity and ensure clarity, SLOs should only encompass the most critical metrics and be expressed in plain language. Similar to SLAs, SLOs should also consider factors like client-side delays.

Tech teams should stay on top of SLAs to prioritize and resolve requests based on their importance. Automated escalation rules can be implemented to notify the relevant team members and prevent SLA breaches.


Error budgets play a crucial role in incident management and allow tech teams to balance meeting SLA commitments and fostering innovation. By understanding and effectively utilizing error budgets, development teams can minimize incidents while maintaining agility and driving innovation. It is essential for tech teams to have a clear understanding of their SLAs and SLOs to calculate and leverage error budgets appropriately. By doing so, organizations can optimize their systems, minimize downtime, and deliver a seamless experience to their customers.

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