The great success Starbucks has experienced on a global level has not come without its ups and downs. Howard Schultz, the company’s chairman and CEO, took the ExpoManagement Madrid 2012stage to tell the incredible story of evolution and growth of this global enterprise, as well his challenges for today’s business leaders to take responsibility for the changes they want to see in their community and society.
-one of Starbucks’ most risky investments
-why disruptive innovation holds the future of every business
-the 3 seismic shifts every business leader must be aware of
After 15 years of amazing growth, in 2008 Starbucks was in trouble. Not just because of the economic recession, but because the company began to compromise customer experience for short-term gains. Stepping back into the role of CEO in 2008, the story of Schultz’s decision to shut down all Starbucks in order to reteach baristas how to make a good cup of coffee (and the $12 million it cost the company) is fairly well known.
However, the less-known story is the one where he brought together 11,000 store managers in the 9th ward of New Orleans, inviting leaders from municipalities all over the country in order create a space for conversation and partnership between the two. The cost? $30 million.
Schultz took these pricey risks because he truly believed in demonstrating transparency to customers and to his own people. “You can’t expect people it follow you if you aren’t being transparent, authentic and genuine.”
Schultz also proclaimed that the future of every business is linked to its ability to disruptively innovate:
“Every organization must have curiosity to see around corners, must have the understanding and intent to see things other people don’t see and don’t anticipate, and then you must have the courage, especially at a time like this, to make a big bet and go after it.”
The three seismic shifts every successful company will have to face:
1. Understand the situation of the customer and the financial pressure they are under. How can you create value proposition by putting your feet in the shoes of customers?
2. Be aware of the title wave of change in business due to social digital media and mobile commerce. Nowadays in order to understand commerce a company must understand the impact that the smart phone will have. Leaders must create organizations of people that understand social and digital media in order to build the culture within enterprise.
3. Attract and retain great people. Be sure the values of the business align with those of the consumer as well as your employees. The consumer today has a desire to support brands whose values and guiding principles are compatible with their own.