MANAGEMENT SPECIAL ...............Size Matters

Size Matters 

Scaling up excellence requires idiosyncratic talent

In 2006, Professor Hayagreeva (Huggy) Rao and Robert Sutton were teaching a short course on ‘Customer Focussed Innovation’ at Stanford University. Rao, the Atholl McBean Professor of Organizational Behaviour and Human Resources, Stanford University says that one recurring question was on how to scale up the pockets of excellence in an organization.

“We realised that our answers to those questions were rather lame, so we set out to research this,” says Rao. This forms the basis for his upcoming book, Scaling Up Excellence: Getting to More without Settling for Less, co-authored with Bob Sutton, Professor of Management at Stanford Engineering School.

The duo realised that whether it was a start-up or a five member business unit within a larger organization, the issues remained the same. There are always groups within an organization who are performing brilliantly, and the challenge for the leader lies in transferring and replicating this in the rest of the organization. This is a challenge for leaders at all levels.

“The details and daily dramas vary wildly from place to place but the similarities among scaling challenges are more important than the differences. The key choices that leaders face and the principles that help organizations scale up without screwing up are strikingly consistent,” says Rao, adding that scaling up excellence requires idiosyncratic talent and not everyone has it. He defines excellence as people doing the right thing when no one is looking over their shoulder. As a leader, that’s what you need if you want to have a nimbler, faster organisation which can replicate and innovate and do things better. Taking successful behaviours and practices from one part of the organization and spreading it across a larger number of people is never going to be easy. It’s important to remember that scaling up doesn’t mean replicating things down to the last detail.

Scaling up excellence isn’t about introducing new behaviours. It’s easier and more effective to stop bad habits rather than introduce new ones, and this is where cognitive load matters. As organizations grow, they become more complex and scaling up places additional demands on people. They’ll focus on the wrong tasks or shift focus too often and that results in poor performance. “Load degrades accountability, and wherever possible, we must work to reduce our cognitive load,” says Rao. “Scaling up excellence is not addition but smart subtraction.” Leaders who are adept at scaling excellence talk and act like they are knee-deep in a manageable mess but at the same time realise that there will be patches of unpredictability and unpleasantness.

The biggest mistake most leaders make is to sacrifice mindset for scale. At the peak of its expansion, the inside of a Starbucks smelled like egg sandwiches and not coffee. That’s when CEO Howard Schultz realised that they had over scaled. “The most important thing to do is define what is sacred and what’s taboo – the one thing you would never do,” says Rao.

Another common mistake leaders make is travelling across the country making the same presentation in all locations without really taking the employees point of view into consideration. “A successful scale-up is not an ‘air war’ but a ‘ground war’. You can’t make power point presentations and expect the changes to stick. You need to look into the issues that the workers down the line face and work at fixing those,” says Rao. There are many mental butlers in our head, he says, and it’s important to get them to work for you so that people do things without having to. For instance in one experiment it was found that simply by spraying a citrus fragrance in a room stopped people from littering.

“Most people who scale up excellence think people can only read and listen and forget that we have five senses,” says Rao. The other thing to keep in mind is the trade-off between poetry and prose, or between having an inspiring lofty vision for the organization as against getting involved in the day to day running of it. Leaders tend to over emphasise one and forget the other and while scaling up, it’s critical to find this balance. While both can never be fully aligned, finding a balance between the two is critical.

by Priyanka Sangani CDET140214