Chapter 2: PRODUCTION REQUIREMENTS & ARCHITECTURE - System Design Course: Complete Production Architecture | PlayBook Library

SLIDE 8: Section 2: Production Requirements and Architecture Boundaries

What We Will Cover:

CODE

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Production Requirements:
Operational constraints, compliance, team ownership, evolution over time

Service Boundaries:
When to split, ownership models, API contracts, versioning

Sync vs Async:
When to use each, hybrid patterns, trade-offs

Stateful vs Stateless:
Why stateless is preferred, when state is unavoidable, session management

SLIDE 9: Production Requirements: Uptime

Availability: The Math That Matters

Availability Targets:

Target	Annual Downtime	Monthly Downtime	Called
99%	3.65 days	7.3 hours	Two nines
99.9%	8.76 hours	43.8 minutes	Three nines
99.99%	52.6 minutes	4.38 minutes	Four nines
99.999%	5.26 minutes	26.3 seconds	Five nines

Reality Check:

CODE

Your system depends on:
- Database (99.99% SLA)
- Cache (99.99% SLA)
- Message Queue (99.9% SLA)
- External Payment API (99.9% SLA)

Combined availability = 0.9999 x 0.9999 x 0.999 x 0.999
                     = 0.9978
                     = 99.78% (approximately two hours downtime per month)

Key Insight:
Your availability is limited by your least reliable dependency.

SLIDE 9B: Production Requirements: Uptime (continued)

How This Changes Your Design:

Interview Answer:
“We will use a database and a cache.”

Production Answer:
“Our database has 99.99% SLA. Our cache has 99.99% SLA. Combined, that gives us 99.98%. To achieve our 99.99% target, we need:

Fallback to database when cache fails
Read replicas for database failover
Circuit breakers to prevent cascade failures
Graceful degradation when dependencies are slow”

Architecture Implication:

CODE

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Every dependency needs a fallback path.

SLIDE 10: Production Requirements: Latency

Latency Budgets: How to Allocate Time

Example: 500ms P99 Budget for API Response

Component	Budget	Reasoning
Network (client to LB)	50ms	Geographic distance
Load Balancer	5ms	Should be negligible
Auth/Rate Limiting	20ms	Token validation
Application Logic	100ms	Business logic
Database Query	150ms	Complex queries
Cache Lookup	10ms	Should be fast
External API Call	150ms	Third party dependency
Buffer	15ms	Unexpected delays
Total	500ms	P99 target

Key Insight:
If your database takes 200ms, you have already blown your budget. Latency budgets force you to identify slow components early.

SLIDE 10B: Production Requirements: Latency (continued)

Latency Distribution: P50 vs P95 vs P99

CODE

P50 (median): 50% of requests are faster than this
P95: 95% of requests are faster than this
P99: 99% of requests are faster than this
P99.9: 99.9% of requests are faster than this

Why P99 Matters More Than Average:

CODE

Scenario: 1 million requests per day

P99 = 500ms means:
- 10,000 requests per day take longer than 500ms
- That is 10,000 frustrated users

If those slow requests are from your biggest customers,
you have a serious problem.

Production Practice:
Always measure P50, P95, P99. Set alerts on P99, not average.

SLIDE 11: Production Requirements: Cost

Cost Constraints Shape Architecture

Typical Monthly Costs at Scale:

Component	Unit	Cost Per Unit
Compute (VM)	Per instance	$100-500/mo \vert 100 instances =$ 50K/mo
Database (RDS)	Per instance	$500-2000/mo \vert 10 instances =$ 15K/mo
Cache (Redis)	Per GB	$30-50/mo \vert 500GB =$ 20K/mo
Storage (S3)	Per TB	$23/mo \vert 100TB =$ 2.3K/mo
Bandwidth (Egress)	Per TB	$90/mo \vert 100TB =$ 9K/mo
CDN	Per TB	$85/mo \vert 500TB =$ 42.5K/mo

The Hidden Cost: Bandwidth

Egress (data leaving your cloud) is often the largest surprise cost. At Instagram scale, CDN egress alone costs $50M+ per month.

SLIDE 11B: Production Requirements: Cost (continued)

How Cost Changes Architecture Decisions:

Decision: Compute Images on Upload vs On Request

Approach	Compute Cost	Storage Cost	Latency	Total
On Upload (eager)	High once	High (store all sizes)	Low	Higher storage
On Request (lazy)	High repeatedly	Low (store original)	High first time	Higher compute
Hybrid (eager + cache)	Medium	Medium	Low	Balanced

Production Answer:
“We will compute thumbnails on upload because storage is cheap ($23/TB) but compute and latency are expensive. We will generate 3 sizes and cache them on CDN. The tradeoff is higher storage cost but consistent low latency.”

Key Insight:
Every architecture decision has a cost implication. Senior engineers can estimate costs and justify tradeoffs.

SLIDE 12: Production Requirements: Team and Ownership

Conway’s Law in Practice

Conway’s Law:
“Organizations design systems that mirror their communication structure.”

Implication:
Your architecture will reflect your team structure whether you plan for it or not.

Example:

Team Structure	Resulting Architecture
1 team, 5 engineers	Monolith or 2-3 services
3 teams, 15 engineers	5-10 services with clear ownership
10 teams, 50 engineers	Microservices with platform team

Anti-Pattern:
5 engineers trying to maintain 20 microservices. The operational overhead will crush them.

Production Rule:
One team should own no more than 2-3 services. If you have more services than engineers, you have a problem.

SLIDE 12B: Production Requirements: Team and Ownership (continued)

Ownership Model:

CODE

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What Ownership Means:

Responsibility	Description
Code	Team writes and reviews all code
Oncall	Team responds to pages for this service
SLA	Team is accountable for uptime and latency
Roadmap	Team decides what features to build
Dependencies	Team manages upgrades and deprecations

Anti-Pattern: Shared Ownership

“Everyone owns it” means “no one owns it.” When an incident happens at 3am, who gets paged? If the answer is unclear, you do not have ownership.

SLIDE 13: Production Requirements: Compliance

Compliance Constraints on Architecture

Common Compliance Requirements:

Regulation	Requirement	Architecture Impact
GDPR	Right to deletion	Must be able to delete all user data
GDPR	Data residency	EU user data must stay in EU
SOC2	Audit logging	Every access must be logged
HIPAA	Encryption at rest	All healthcare data encrypted
PCI-DSS	Network segmentation	Payment systems isolated

Example: GDPR Data Residency

CODE

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Cannot route EU user data through US servers, even temporarily.

SLIDE 13B: Production Requirements: Compliance (continued)

How Compliance Changes Design:

Interview Answer:
“User data is stored in our database with replication.”

Production Answer:
“User data is stored in regionally partitioned databases. EU users are routed to eu-west-1, US users to us-east-1. Cross-region replication excludes PII fields. We maintain deletion capability with soft-delete plus 30-day hard-delete job. All access is logged to immutable audit storage for SOC2 compliance.”

Compliance Checklist:

Question	Why It Matters
Where is data stored geographically?	Data residency laws
Can we delete all user data on request?	Right to deletion
Is all access logged?	Audit requirements
Is data encrypted at rest and in transit?	Security standards
Are payment systems isolated?	PCI-DSS

SLIDE 14: Production Requirements: Evolution Over Time

Day 1 vs Day 100 vs Day 1000

What Changes:

Dimension	Day 1	Day 100	Day 1000
Users	100	10,000	1,000,000
Data	1 GB	100 GB	10 TB
Team	3 engineers	10 engineers	50 engineers
Services	1 monolith	5 services	30 services
SLA	Best effort	99.9%	99.99%
Oncall	Founders	Rotation	24/7 coverage

Key Insight:
The architecture that works on Day 1 will not work on Day 1000. Design for the next 10x, not the next 100x.

SLIDE 14B: Production Requirements: Evolution Over Time (continued)

When to Re-Architect:

CODE

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Pain Signals That Indicate Re-Architecture:

Signal	Symptom	Threshold
Deploy Frequency	Deploys blocked by other teams	More than 2 days wait
Incident Rate	Same service causes repeated outages	More than 2 per month
Latency	P99 approaching SLA limit	Above 80% of budget
Cost	Single component dominates spend	Above 40% of total
Team Friction	Arguments about code ownership	Recurring conflicts

Production Practice:
Do not re-architect based on predictions. Re-architect based on observed pain.