Scaling Up: How a Few Companies Make It...and Why the Rest Don't (Mastering the Rockefeller Habits 2.0)

Summary

This is a book for CEOs, directors and leaders who are in the process of building and developing growth companies. The book is structured in four main sections:

  1. Scaling up people
  2. Scaling up strategy
  3. Scaling up execution
  4. Scaling up cash

The people section explains how great people is critical for the development of successful companies. Initially, the author quotes management guru Peter Drucker to highlight the importance of having good leaders and senior leadership who define proper metrics, direction and accountability to achieve the desired KPIs: "The bottleneck is always at the top of the bottle".

The book provides tips and strategies for attracting and hiring A players who will be a good fit for the company, sharing the same goals and values. Harnish explains how great managers need to become excellent coaches to their teams in order to keep everyone happy, productive, engaged and learning continuously.

The section about strategy focuses on identifying the values, purpose and competencies of the organization. This should be used as the foundation for building an industry-dominating strategic plan that applies the SWOT (Strengths, Weaknesses, Opportunities, and Threats) analysis, but converted to SWT (Strengths, Weaknesses and Trends) so that the plan can take into account major trends that might shake up the business and industry.

The chapters about execution begin by emphasizing that establishing clear, smart and laser-focused priorities should be the first step to achieve the significant goals of the company. This is the section where the book describes and explains "the Rockefeller Habits", which is one of the key portions of this book, considering that its title and cover advertises "Mastering the Rockefeller Habits 2.0".

One chapter is devoted to the importance of using data as a tool for leaders to make informed predictions and decisions. This includes gathering customer input to take actions for customer retention. In addition, this section explains the importance of creating metrics and KPIs with effective accountability management systems.

The last chapter of the section about scaling up execution focuses on the powerful advantages of meeting regularly implementing the daily huddle, the weekly meeting, the monthly management meeting and the quarterly and annual planning meetings.

The fourth and last section of the book is about the role that cash plays in growth companies. The section begins with this statement: "Growth suchs cash". The argument of the author is that cash can be compared to the oxygen that is required for fueling growth. The book shares strategies for improving the cash conversion cycle to build and maintain healthy amounts of cash that can be used for investment purposes. This is the financial and accounting section of the book but the bottom line is that instead of being crushed by bank loans for company growth and expansion, it is better and ideal to have sufficient cash accumulated that can in the future be used for growth and investment without having to turn to banks and their high interest rates.

J: Just citing the book - M: My conversion from theory to practice (9), My vocabulary has (2) new words from this book - CR: Created - LU: Last Updated. (YYYY-MM-DD HH:MM:SS GMT).

J:

"And along the journey, there is a set of habits — routines — that will make the climb easier. “Routine sets you free” is a key driving principle behind our methodologies and tools. You may set a goal to lose weight, but unless you change some daily and weekly routines, it will never be accomplished. Goals without routines are wishes; routines without goals are aimless. The most successful business leaders have a clear vision and the disciplines (routines) to make it a reality. “Routine sets you free.”" (Chapter 1)

M:

My goal is to lose weight and in order to achieve it, I created the routine of running on the treadmill every day for 36 minutes in the morning and 36 minutes at night at an easy pace of 5 mph. CR: 2019-03-01 00:46:05 LU: 2019-03-01 00:46:05

J:

'Strategic thinking requires a handful of senior leaders meeting weekly (it's not sufficient to do strategy work once a quarter or once a year) in what Jim Collins calls "the council." It's a meeting separate from the standard executive team meeting. Rather than getting mired in operational issues, the strategic thinking team is focused on discussing a few big strategic issues including those outlined in the SWT and 7 Strata tools summarized below.

Strategic thinking iterations

' (Chapter 1)

M:

I joined "the council" at the company I work for. We meet weekly to do strategy work so that instead of scheduling strategic thinking time once every quarter or year, we do it every week using iterations to take strategic decisions often, test them, and constantly improve using experiments while relying on results. CR: 2019-03-14 22:35:55 LU: 2019-03-14 22:35:55

J:

"Like Rudy, who continues to go out beyond the harbor bar, you will find that leading a growth company is one of the more exhilarating things you can do in the world." (Chapter 2)

M:

Skydiving has been one of my most exhilarating experiences but I imagine that the thrill of bungee jumping could be even higher and scarier. CR: 2019-03-11 20:30:31 LU: 2019-03-11 20:30:31

J:

"At the same time, there may be some people in your personal or professional life who are destructive — literally draining the life out of you — and/or distract you from your higher goals. There’s a space on the form where you can note relationships you want to end gracefully." (Chapter 3)

M:

I have started to pay special attention to the fact that in my personal and professional life, avoiding to join the wrong team is as important as building and joining the right team. CR: 2019-03-06 18:09:43 LU: 2019-03-06 18:09:43

J:

'"We're looking for people who receive candor well," says Nash.' (Chapter 4)

M:

The lack of candor in politicians to acknowledge proven corruption in their political parties contributes to make voters to reject those parties and their political platforms. CR: 2019-03-12 20:31:22 LU: 2019-03-12 20:31:22

J:

'NOTE: This is the first time the term “differentiation” has been used. Competitors can pursue owning the same words, make the same Brand Promises, and offer the same guarantees. However, it’s HOW you deliver on your promises where differentiation occurs. Adds Kevin Daum, author of ROAR! Get Heard in the Sales and Marketing Jungle: A Business Fable, “a true differentiator can only be defined as something your competitor won’t do or can’t do without great effort or expense. Often these can take years to develop since if it can be done cheaply, easily and quickly it provides little or no competitive advantage.”' (Chapter 7)

M:

My differentiator is the books that I read, study and practice. Not to mention the new books that I will add to my www.jaimemontoya.com collection in the future. CR: 2019-03-16 10:53:11 LU: 2019-03-16 10:53:11

J:

"*Rocks: This term honors the late Stephen R. Covey, author of The 7 Habits of Highly Effective People: Powerful Lessons in Personal Change. He would demonstrate how, if you have a limited amount of time (a bucket) and put in a bunch of pebbles first (email, distractions, etc.), there’s not much room for the big important stuff (Rocks). But if you reverse the process — take care of the big things first — then there’s room for all of it. To see an excellent demonstration of Covey’s rock analogy, go to YouTube and search “Big Rocks in First” and watch the six-minute video with your team." (Chapter 8)

M:

Reading books, applying or practicing what I read from those books, and increasing my vocabulary with new words that I did not know from that reading journey is one of my "Big Rocks". CR: 2019-03-18 17:48:48 LU: 2019-03-18 17:48:48

J:

"Trends

In addition to sizing up the immediate opportunities and threats that the SWOT tends to surface, the senior team needs to rise above all of this. Leaders should look at major trends, such as significant changes in technology, distribution, product innovation, markets, and consumer and social developments around the world that might shake up not only the business but the entire industry.

Forget about the competitor down the street. Is there a company on the other side of the globe that might put you out of business? Is there a new technology coming onto the start-up scene that could lead to an overnight change in the way all companies must do business? How is robotics changing the very nature of work? These are the kinds of questions the strategic thinking team must explore." (Chapter 8)

M:

I examined the https://insights.stackoverflow.com/survey/2018/ survey results to learn about technology trends in terms of worldwide popularity. I want to stay relevant in my knowledge as a programmer and I discovered that I needed to learn Node.js, Angular and React. I have realized that I should not solely rely on PHP for my future because Python seems to be growing exponentially and PHP salaries seem to be lower than what can be earned using other programming technologies. I also learned that JavaScript is still as relevant as it has been during the last few years and it is a good investment if I continue focusing on JavaScript and learning/practicing it even more. CR: 2019-03-19 18:29:27 LU: 2019-03-19 18:29:27

J:

"The team meets frequently (weekly is best) for strategic thinking." (Chapter 8)

M:

I participate every Monday in the Meeting of Directors of the company that I work for in order to discuss strategic thinking. CR: 2019-03-21 21:57:44 LU: 2019-03-21 21:57:44

J:

"All employees are in a daily huddle that lasts less than 15 minutes." (Chapter 8)

M:

Every morning from Monday through Friday I am in a daily huddle that lasts approximately 13 minutes. CR: 2019-03-21 22:32:28 LU: 2019-03-21 22:39:58

J:

"2. The quarterly and annual planning meetings. At this one- to three-day offsite meeting, leaders update the Growth Tools" (Chapter 11)

M:

I participated in a quarterly meeting where we updated the One-Page Strategic Plan (OPSP), which is one part of the Growth Tools available at https://scalingup.com/wp-content/uploads/2018/12/growth-tools-english.pdf. CR: 2019-04-14 01:34:43 LU: 2019-04-14 01:34:43

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