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Transcript of Howard Schultz
1994: Introduce Frappuccino
innovative drink - based on employees' idea
groupthink -> problem of idea overload
“Third place” for customers -> make them feel unique
tailor-made coffee - with customer's name
comfortable Starbucks environment
recyclable cardboard ring
1.3 Limitation in Schultz's Personality: Over-Confident
Able to see the big picture and innovate
Belief in always overcoming adverse situation
Failed in meeting employees' expectation in 2010
Overrides decision-making process
Develops strategies without considerations of opinions
Puts pressure on employees and hinders loyalty
Expands his advantage in 'agreeableness' - understands staff and opinions
Optimizes his performance in 'extraversion' - influences staff's motivation through energetic approach
2. Leadership Styles
Recommendations to HKU Students
Chairman & CEO of Starbucks Coffee Company
: 6 stores & <100 employees
: 22 000 stores & 190 000 employees
Famous expansion strategies
Starbucks culture: Employees are required to learn the Starbucks’ way of doing things
Strong connection between shared values in the company
Everyone in the company win together
Emphasizes much on building employee satisfaction
Provide positive working climates
Achieve the goal of having happy customers
2.2 Effective Employee Management
best employee awards
comprehensive medical insurance
Regular appraisal with employees
7th Best U.S. company for Employee (2008)
Close relationship with employee -> treat them as partner
create an enthusiasm atmosphere
Howard Schultz is a determined and open-minded leader who has passion on building Starbucks in a different way
Learn from Schultz:
Set appropriate goals
Pay attention to relationships with others
3.1 Self-learning and self-improving
Admit the failures and their weaknesses
"We had to own our mistakes"
3.2 Relationship with team members and customers and motivation strategy
People-oriented listening to your team
Extrinsic motivation strategy
Words of compromise and recognition
3.3 Goal setting and optimal leadership style
Setting up timetable and strategies
Leadership style depending on different situations
1.2 Agreeableness: Emotional Intelligent
High level of social awareness and relationship management with his workforce
Provides intrinsic motivation and sense of importance to workers
Eliminates hierarchy across management levels
Encourages expressing opinions
Low employee turnover rate of 70% at Starbucks
1.1 Extraversion: Determination and Passion
Determination and passion in serving customers
Understands customers’ needs with constant communications
Raises recognitions and customers’ loyalty around the globe
Determination in achieving goals
Delivers the targets clearly
Increases employees' understanding in their work
The Big Five: Trait Approach
2.4 SMART Goal Setting
maintain high quality coffee
protect the environment
e.g. water & energy conservation
specific - well-defined
measurable - aspirational target
achievable - set according to past data
reasonable - can be achieved with the existing capital
timetable - set to be achieved by certain year
expand to China’s market -> lack of knowledge of it's culture
offer food instead of just drinks
2.3 Comprehensive Planning
expansion plan in U.S.
poor choice of location
learn from mistakes
develop a team analyzing the demography
better selection of the location
CEO of Starbucks
Chan Hiu Ying (3035197204)
Choi Wai Yiu (3035118480)
Cheuk Ki Yui (3035192656)
Lam Pui Kiu (3035194202)
Sin Hei Yu (3035191028)
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