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Multiunit-multimarket (MUMM) organizations compete in multiple markets with multiple units that share a common template for doing business. Yet, operating in multiple environments invariably creates a tension between the benefits conferred by high-fidelity replication of the template and the potential benefits of local adaptations. Using a proprietary longitudinal dataset on a large MUMM franchise organization, we find that the more adaptations a franchised unit makes to the core franchise template, the less likely it is to attain superior performance and the more likely it is to suffer near-failure performance. Moreover, the relationship between template adaptation and extreme performance is positively and significantly moderated by the munificence of the local environment a focal unit operates in. Interestingly, under high level of environmental munificence, adaptation increases the likelihood of superior performance …