Sizing Up SCALING UP by Verne Harnish

SCALING UP by Verne HarnishWe developed a Big Hairy Audacious Goal.

We started daily huddles.

We created a one-page strategic plan.

We made a habit of the Rockefeller Habits.

In 2012, our CEO, Mark Jacobson, read the book Mastering the Rockefeller Habits. He passed the book to each of us on the executive team to read. It’s been part of our culture at NetGain Technologies ever since.

Verne Harnish published his book in 2002 and it became an instant classic. Just the name Rockefeller oozes success. When Rockefeller died in 1937, his total worth equaled 1.5% of America’s total economy. extrapolates that in today’s economy he would have a net worth of about $340 billion. That is about four times that of Bill Gates, currently the world’s richest man.

In 2015, still working to master the Rockefeller Habits to improve our managed I.T. services company, we wanted all managers to read the book. So we went online to buy more copies so we could pass them around to employees in the company. Yes, we’re a technology company… and yes we could just get the e-book… but there’s just something about turning pages and having classic books on your shelf, right?

When we went online to make the seemingly routine purchase, we couldn’t find the book available in a bulk order. We had to go direct to the publisher. Gazelles Inc informed us that Mastering the Rockefeller Habits has been replaced.


They said Harnish has come out with a new book:

Scaling Up: Mastering the Rockefeller Habits 2.0
How a Few Companies Make It… and Why the Rest Don’t

I thought about it. Scaling Up by Verne Harnish. I mean, we wanted the classic.

However, it only took a few minutes of digging in to know Harnish pulled off the impossible. He made the sequel better than the original. He kept his perfect writing style but added amazing new insights, tools, and a significantly updated strategic plan.

It made Forbes contributor Shep Hyken’s Top 10 business books from 2015. His review says:

  1. Scaling Up: How a Few Companies Make It… and Why the Rest Don’t by Verne Harnish – The first book I read from Verne Harnish was Mastering the Rockefeller Habits. I was hooked, as I learned such practical advice that I could apply to my business immediately. This is the 2.0 version of that first book and focuses on the major decisions that every company must get right; people, strategy, execution and cash. For anyone who runs a company, especially one that is growing, this is a must-read.

We bought it.

We read it.

It’s amazing.

What’s in Scaling Up by Verne Harnish?

Listen to this… On page 5 in the Overview, the book makes some awesome claims: “put a ‘dent in the universe’” and dominate your industry.

The tools and techniques described focus on three deliverables:

  1. Cut the company’s operational activities—the time it takes leadership to manage the business—by 80%
  2. Refocus the senior team on market-facing activities
  3. Realign everyone else (onto the same page) to drive execution and results

And when these tools are successfully implemented, organizations attain these four outcomes:

  1. At least double the rate of cash flow
  2. Triple the industry average profitability
  3. Increase the valuation of the firm relative to competitors
  4. Help the stakeholders – employees, customers, and shareholders – enjoy the climb

Yet there are three barriers to scaling up, which Harnish details in the first chapter:

  1. Leadership – ultimately the leaders don’t grow enough leaders throughout the organization who can delegate and predict
  2. Scalable infrastructure – the lack of the systems and structures (physical and organizational) to handle the complexities in communication and decisions that can come with growth
  3. Market dynamics – the failure to address the increased competitive pressures that build (and erode margins) as you scale the business

It continues on page 6.

Therefore, your team must use the tools shared in the book to master four fundamentals:

  1. In leading people, basic rules of parenting apply. Establish a handful of rules and repeat yourself a lot. Be consistent. This is the role and power of Core Values. So essential these Values guide all the relationship decisions and systems in the company.
  2. In setting Strategy, which must past two tests: what you’re planning to do really matter to customers; and does it differentiate you from the competition.
  3. In driving Execution, requires three habits: have only a few Priorities, gather quantitative and qualitative Data daily and review weekly to guide decisions; and establish an effective daily, weekly, monthly, quarterly, and annual meeting Rhythm to keep everyone in the loop. The best at this grow faster.

In managing Cash, ummm… don’t run out of it. Understand how every decision affects cash flow as you would to revenue and profitability.

Totally cool, right?

I will continue to refer to this book’s lessons in future blog posts. Let me know if you have any questions and I look forward to sharing my take on Scaling Up by Verne Harnish.



(“Overview” description and components reproduced in this text were used with permission of the publisher.)


Related Posts