It means to elevate something to the next higher level, or the next extreme.
If you're playing your stereo and someone says "crank it up a notch," you'll turn the volume up a bit.
If you're at a party and all that is available for refreshments is soft drinks (Coca-Cola, etc), someone might bring out a bottle of spirits and say "let's crank this party up a notch!"
You might be eating roast beef for dinner, and I'll offer you some horseradish, saying "Add some of this to your beef, and crank your meal up a notch."
- For Teachers