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Culture, Leadership, and Change in Starbucks
Transcript of Culture, Leadership, and Change in Starbucks
Groth, A. (2011, June 19). 19 amazing ways CEO Howard Schultz saved Starbucks. Business Insider. Retrieved from http://www.businessinsider.com/howard-schultz-turned-starbucks-around-2011-6?op=1
Kim, S. (2011, October 25). 7 companies offering health care benefits to part-time workers. ABC News. Retrieved from http://abcnews.go.com/Business/companies-offering-health-care-benefits-perks-part-time/story?id=14805107#all
Meyers, W. (2005). Conscience in a cup of coffee. U.S. News & World Report, 139(16), 48-50.
Saporito, B. (2012). Starbucks’ Big Mug. Time, 179(25), 51-54.
Schultz, H., & Gordon, J. (2011). Onward: How Starbucks fought for its life without losing its soul. New York: Rodale.
Seaford, B. C., Culp, R. C., & Brooks, B. W. (2012). Starbucks: Maintaining a clear position. Journal Of The International Academy For Case Studies, 18(3), 39-57.
Starbucks. (2012, January 26). Starbucks reports record first quarter fiscal 2012 results [Press Release]. Retrieved from http://news.starbucks.com/article_display.cfm?article_id=612
Starbucks Newsroom. (2010). Starbucks company timeline [Chart]. Retrieved from the Starbucks Corporation website: http://news.starbucks.com/images/10041/StarbucksCompanyTimeline-JAN2010.pdf
Statistic Brain. (2012, September 15). Starbucks Company Statistics [Table]. Retrieved from the Statistic Brain website: http://www.statisticbrain.com/starbucks-company-statistics/ References Change Process Jerry Baldwin
Zev Siegel Seattle, Washington Roasted Coffee Beans
Coffee-related merchandise Offered: 1982 Howard Schultz joins the team as Director of Marketing and Operations 1983 Schultz visits Italy, where he gains a passion for Italian-style coffee houses. 1984 Starbucks tests out Schultz's coffeehouse idea in Seattle and serves the first Starbucks Caffe Latte. 1987 With help from investors, Schultz buys out Starbucks and becomes its CEO.
Starbucks has a total of 17 stores. 1988 Starbucks begins offering health insurance benefits to part-time employees who are eligible. Starbucks has a total of 33 stores. 1996 Starbucks goes global, opening its first store outside the U.S., in Japan. 2000 Schultz leaves his position as CEO and becomes the company's Chief Global Strategist. Starbucks has a total of 3,501 stores. 2005 2008 CEO Orin Smith retires. Jim Donald becomes the new CEO of Starbucks. Howard Schultz resumes his position as CEO of Starbucks and begins making changes. Starbucks has a total of 16,680 stores. Starbucks financial outlook declines; its stock price drops. Present
Began 2012 with 17,003 stores worldwide (Statistic, 2012) (Starbucks, 2010) (Starbucks, 2010) (Certner, 2012) (Starbucks, 2010) (Starbucks, 2010) (Starbucks, 2010) (Starbucks, 2010) (Starbucks, 2010) (Starbucks, 2010) (Starbucks, 2010) (Starbucks, 2010) (Starbucks, 2010) (Starbucks, 2010) (Starbucks, 2010) (Seaford, Culp, & Brooks, 2012) (Seaford, Culp, & Brooks, 2012) (Seaford, Culp, & Brooks, 2012) 1971 When Schultz became proprietor and CEO in 1987, he envisioned it becoming the customer's "Third Place" away from home and work, offering high-end coffee in a relaxing atmosphere. The company had gotten away from that vision, but since 2008, they have sought to renew it. (Seaford, Culp, & Brooks, 2012) "Passion--not ownership or empire--drives Schultz's involvement in some of Starbucks's day-to-day operations." (Meyers, 2005, p. 49) Benevolence to Employees Healthcare benefits to part-time employees
Fortune magazine's "100 Best Companies to Work For" for 13 years in a row (Kim, 2011) In 2008, the company began to falter financially. Schultz, who had given up his role as CEO in 2000 to become the company's Chief Global Strategist, once again took the reigns as Starbucks' Chief Executive Officer. (Statistic, 2012) Schultz brought change with him. Change Strategies: Invest in customers and employees, rather than cut back Enacted customer loyalty programs (Saporito, 2012) Made technological advances (Saporito, 2012) Became more selective about where to open new stores (Saporito, 2012) COMMUNICATION In 2008, Schultz shut down stores across the U.S. for three hours to retrain employees (Schultz & Gordon, 2011) Although it costed the company $6 million dollars, Schultz insisted, "How could it be wrong to invest in our people?" (Schultz & Gordon, 2011) It was seen as a symbolic gesture that made employees more emotionally attached to the company. (Schultz & Gordon, 2011) Schultz made phone call to store to personally ask how things were going (Groth, 2011) (Groth, 2011) Launched a major advertising campaign-- something Starbucks had not done previously. (Groth, 2011) Increased the company's presence in social media and re-created the company's website (Groth, 2011) Schultz invited the public to email him directly
He immediately received 5,000 messages Effectiveness of Change Financially, the changes appear to be successful Starbucks is the largest coffee chain in the world The first quarter of 2012 was a record quarter, with total net revenues increasing by 16% (Starbucks, 2012) Starbucks began 2012 with a total of 17,003 stores worldwide, with 10,787 of those stores in the U.S. (Statistic, 2012)