Scaling Up Excellence: Getting to More Without Settling for Less

The problem of scaling is tricky because, on one hand, you might not want to create clones based on a person, team, or model that embodies excellence. On the other hand, if you encourage variation and creativity, you run the risk of transforming what made one team excellent into something that isn't quite so excellent any more.

How to get the balance right is one of the key questions when it comes to spreading excellence within your organization. Fortunately, the authors outline the benefits and risks of both approaches within the book, giving you the tools to make the best decision for your organization.

Another consideration with scaling is that you shouldn't just replicate – even when it's possible. Do the same thing year after year, and your organization will stagnate. You have to aspire to continuously do better.

The authors spent seven years researching the problem of scaling, and they developed seven lessons, or mantras, as a result of this study. These seven mantras help guide you through the process of spreading excellence in your organization.

"Scaling Up Excellence" will be most relevant for CEOs, top leaders, and middle managers who have the desire and power to make large-scale changes in their teams and organizations. It doesn't matter if you have five employees or 500 – if you run a global corporation or a tiny non-profit, the lessons you learn here will help make your organization better.

The book is full of real-life case studies and examples. This shows readers what these principles look like in action. And, it helps strengthen the belief that if these organizations and teams can do it, so can you.

Robert Sutton is a professor at Stanford University. He's also an organizational researcher and the author of two New York Times best-selling books.

Huggy Rao is an author and professor of organizational behavior at Stanford University. He's the recipient of numerous research and teaching awards, and has published more than 50 research papers and monographs.

So, keep listening to find out what Buddhism and Catholicism have to do with organizational change, whether beliefs or behavior comes first as you try to emulate excellence, and why a bit of discomfort is a sign that you're on the right track.

"Scaling Up Excellence" is divided into three parts.

Part one sets the stage. Here, you learn what scaling is, and why it's so important to organizations.

Part two makes up the real "how to" portion of the book. Here you get plenty of strategies, tips, and examples to show you how to scale up excellence in your organization. Part three gives a short wrap up of the lessons outlined in the book.

The authors point out early on that scaling isn't a quick and easy process. The companies that try to make it so often fail miserably.

In the authors' words, scaling requires sticking with the process, and pressing each person, team, group, division or organization to make one small change after another in what they believe, feel, or do. Think of this process like running a marathon, not a sprint.

The authors also bring up Buddhism versus Catholicism here. And they're not talking about religion – at least not directly. Buddhism and Catholicism are two paths you can choose when it comes to your scaling approach.

With the Catholic approach, the aim is to replicate design and best practices through an organization. Think of this approach as building clones.

With the Buddhist approach, an underlying mindset guides why people do things. But the specifics of what they do are left up to them.

As you might imagine, there are benefits and risks to each approach. But you don't have to choose entirely one or the other. These are two extremes on a continuum.
Some organizations, like chain stores, have successfully adopted the Catholicism approach to scaling, by cloning their best ideas and practices in each new store. But sometimes this approach can backfire.

One example is Home Depot's expansion into China. The home-improvement store's slogan is "You can do it, we can help." Home Depot intended to clone its successful Western model, which embodies this slogan, in China.

The problem is that the United States has a DIY mindset. China doesn't. Most people in China don't have space for tools in their homes, or the know-how to work on home-improvement projects. Labor is cheap, so they're more comfortable paying someone else to do the work for them.

Home Depot never took off in China, and the company closed its last China store in 2012.

Organizations that adopt the so-called Buddhist approach define a central idea of excellence, and then leave it up to individuals or teams to apply this idea.

One example of this is the Joie de Vivre hotel chain. Founding CEO Chip Conley purchased his first hotel in San Francisco. It was a dilapidated mess, but ripe for renovation.

Conley wasn't sure how to make his hotel unique. So, he got an idea to pick a magazine that best defined the aspirations of his target customers. Everyone on his team, except one person, chose Rolling Stone, a music magazine that caters to a young, hip crowd.

His next idea was to choose five words to describe the hotel's essence if it was going to cater to this crowd. Then, he and his team had to devise ways for customers and employees to experience these, using their five senses.

This is the central idea behind Joie de Vivre hotels, each of which is unique. Each hotel, and each team, gets to choose how they scale this idea and make it work.

The authors say that the best leaders find a balance between the Catholic and Buddhist approach. Yes, you can be successful at each end of the continuum, but your best chance of success is probably somewhere in the middle.

McDonald's is a good example of a company that's found this balance. Their food is cooked the same way in each store. But each store's design, employment policies, and even prices are all uniquely different.

So how do you find the best approach for your organization? The authors suggest three questions to help you get your bearings.

One of these is "Do you have a successful template to use as a prototype?"

Finding the balance between standard and custom scaling can be a lengthy, messy process. One way to speed things up is to look for a prototype, process, or template that's working somewhere else, and use that as a framework for your organization.

The other two questions that help you find the best approach for your organization are "Do you suffer from delusions of uniqueness?" and "Will bolstering Buddhism generate crucial understanding, commitment, and innovation?"

In this part of the book, we also hear about the authors' seven mantras, which guide you through the setbacks and confusion that often go along with scaling up excellence. These include "Spread a mindset, not just a footprint," "Engage all the senses," and "Accelerate accountability."

Part two opens with a key question: if you want to spread change, is it better to focus on changing someone's beliefs, or changing their behavior?

Some studies show that first altering people's beliefs using stories, emotion, or other strategies often inspires behavior change. But other studies show the opposite – that if you get people to first change their behavior, they will often change their beliefs to match it.

According to the authors, you have to connect beliefs and behaviors to successfully implement change in your organization. And there are several strategies you can use to do this.

First, name the problem. Figure out what you want to do in your organization, and give it a name. For example, when Ford CEO Alan Mulally took the reins, he realized that internal strife was doing more damage to the company than outside competitors. He named his change campaign Create One Ford.

Once you've given the problem a name, take action publicly. This can mean getting your team to make a public commitment to the change campaign, or doing something to demonstrate your own commitment.

The authors next look at the issue of more, and why more isn't always better when it comes to scaling up excellence.

This is because scaling puts people in unfamiliar situations and through upsetting changes. It's easy for people to get overwhelmed in this process.

This condition is called "cognitive overload." Research shows that when we reach this breaking point in our working memory, we often make bad decisions, or we lose the willpower to make the best choice.

This is why it's important to find a good balance with scaling. You probably have a lot of positive changes you want to make. But, if you dump all those changes on your people all at once, you're going to see some serious backlash.

Another interesting fact from this chapter has to do with team size. The authors cite a number of studies that all show the same thing: the bigger the team, the worse each member performs.

There are several reasons for this. One is that when people have a lot of team members, they support each other less, because it's harder for them to maintain so many relationships. The most efficient team size is four to six people.

We thought this was a useful tidbit that most readers could put into practice right away.

The authors provide a fascinating look at what happens when companies pursue the myth of more. Eventually, these organizations spend more on bureaucracy than they do on the people doing the actual work. And, that's often the death knell of the organization's spirit – and can lead to its demise.

So how do you scale up excellence without running the risk of getting too big, or putting too much pressure on your team? The authors give us five strategies to consider.

One of these is to use subtraction. This means that you and your people seek out every unnecessary tool, process, rule, or impediment, and get rid of them.
Here's an example. Marketing manager Dan Markovitz led a seven-person team in a big company. His team was annoyed and burdened by the complex HR system for managing vacation requests. Markovitz decided to ignore the HR process, and told his team: "I don't care how many vacation days you take, as long as you get your job done."

You might think that some people on the team would take shameless advantage of such an open-ended offer. But the opposite happened. His team was able to stop wasting time on paperwork, and they felt more respected and accountable. The number of vacation days they took actually went down.

Another good example is Adobe. Research has long shown that formal annual performance reviews are ineffective and even cause a number of negative side effects.

So, Adobe got rid of them. Now, managers do check-ins every few months. There are no rules and no paperwork. Managers simply meet with each person on their team informally to give and get feedback.

Now, you probably can't do something quite this drastic on your own team. But you can work to trim down the tools, rules, and processes that cause frustration.

Another strategy you can use when subtracting is to look at when you're upsetting people. If you're not upsetting anyone by taking something away, then you're probably not pushing hard enough. Scaling, and the subtraction that should go along with it, involves removing the old and familiar. As a rule, people don't like this.

The authors tell the story of Steve Jobs at Apple, when he was designing the first Apple mouse. The engineers came to him with a mouse that had two buttons. But Jobs felt the mouse would be simpler and easier to use with just one button.The engineers balked, saying that users would be able to do much more with two buttons. As you might imagine, Jobs won the argument. The point here is that when it comes to doing away with the unnecessary, watch for people to get uncomfortable. When you see them start to squirm, as the authors put it, you know you're on the right track.

Keep in mind that the process of subtraction is never easy, and it is possible to subtract too much. Although Jobs got his way in this story, the reality is that a mouse is more useful with two buttons. Jobs wanted it kept simple, but in the end he made it too simple.

So, don't be afraid to trim things down. But do this cautiously. You don't want to subtract so much that you limit the usefulness of a product or process.

So, what's our last word on "Scaling Up Excellence"?

The book focuses on a topic that's relevant to any sized organization. It's well-written, practical, and full of valuable insights on how leaders can spread excellence and best practices within their organizations.

The book's lessons are interwoven with plenty of examples, anecdotes, and case studies. These stories do an excellent job of illustrating what these lessons look like in real life. But sometimes, the original message gets a bit lost. You'll want to take notes or read with a highlighter to flag key points.

We appreciate that the authors based their approach on real research. They spent seven years investigating this problem, and they explain their research in the appendix of the book. This adds credibility and weight to the seven scaling mantras, in particular.

All in all, we have no trouble recommending this book.

"Scaling Up Excellence" by Robert Sutton and Huggy Rao is published by Crown Business.

That's the end of this episode of Book Insights. Thanks for listening.