What is KTLO? A set of radio stations in Mountain Home, Arkansas, playing "America's best music?" Well, maybe, but that's not what I'm discussing today. KTLO is the amount of effort an IT organization puts forth to maintain a hypothetical steady state. OK, that didn't help much. Let me try again: KTLO is the effort by an IT organization to support and maintain the things the company has done previously. KTLO does not include the effort to develop or enhance new capabilities.\nOK. So what?\nThe portion of the IT budget going to KTLO -- or "keeping the lights on" -- is important. The edge cases best make my point. Imagine the two extremes: 100% of the IT budget is devoted to keeping the lights on and, separately, 100% of the IT budget is available to do new things.\n100% KTLO\nIn an IT organization fully consumed by efforts to keep the existing world operating, there can be little innovation. There are few opportunities to cross-pollinate skills among or between people. There is no slack capacity to sharpen the saw and improve performance. In a nutshell, the organization is running at top speed simply not to lose ground. There is some good news, some of it tongue in cheek: The skills you have are the skills you are going to use. Some tasks do get easier with repetition, so next year KTOL might consume less than 100% of your resources. And there is no risk of a new project failing, because there are no new projects.\n0% KTLO\nIn an IT organization with no installed base or no legacy environment, the situation is different. None of the effort is spent in maintaining and operating existing systems, and 100% is spent on new capabilities. This could come about because the company has no revenue and no customers, but then the situation should be temporary. I can't come up with another case in which the company would have no need to support what it has done before, because even if all the IT operations are outsourced, some portion of the resources (money) will still be spent looking backward.\nHowever, in this hypothetical situation, the team could focus on doing new things without any "drag" from the past.\nWith those edge cases in mind, think about the right balance for your company. What is the right balance for you? It depends on your products, your growth and your access to capital, and on how much effort your existing environment requires to keep operating. For example:\nA company with a mature set of products and a strong existing set of customers may focus more of its efforts on supporting those products and customers. Having a greater KTLO percentage may be appropriate because that is where the company is getting its value.\nA company looking to enter new markets and develop new products needs to have more capacity to do new things. This company should be driving to have a lower KTLO percentage.\nA company in a short-term cash crunch may focus entirely on keeping the lights on. Once the cash crunch lessens, the company may be able to spring back and spend more on the forward-looking capabilities.\nThe right answer for your company depends, of course, but at least you now have another acronym and another way to think about your expenditures. The next time your IT team talks about KTLO, you can nod sagely and keep your hand off the radio dial.