Q: We are redoing our centralized on-call, ideal would be to have each 4-5 person pod on call for their own services but there's concern about the productivity hit.
A: For now, let's set the human element aside and only consider work hours.
Something I think about a lot in these situations is the feedback loop and responsibility. Take the point of view of whoever decides what's a priority sprint over sprint: if the systems are shoddy and it takes one of four engineers to keep them alive, they take the hit to their feature delivery. If the keeping-alive is done by some central ops team, or a diffuse on-call rotation that only hits your team every 3 months, congratulations you've externalized the consequences of your decisions while getting to claim credit for all the stuff you've delivered. The SWE productivity hit your managers are lamenting is the cost of internalizing these costs. The benefit is autonomy in making prioritization decisions locally based on what makes sense for this area. Structurally, you