August 19, 2016

Starbucks sign

Starbucks can be found in over 65 countries. Credit: James Maskell / Flickr Creative Commons

These days, the green-and-white Starbucks logo is about as ubiquitous as stop signs. With more than 21,000 stores in over 65 countries, it's a good bet that there’s a Starbucks within a block of wherever you're reading this.
 
But it wasn’t always thus.
 
Back in the early 1980s, the current CEO of Starbucks, Howard Schultz, was a salesman at a Swedish housewares company, when he noticed that one little shop in Seattle was buying a whole lot of coffee filters. “He’s a very good listener, and has very good antennae, both at the micro level and the macro level,” says Nancy Koehn, a Harvard Business School historian and author.
 
Schultz followed his antennae, and left his job to work for the little upstart company. Starbucks' founders then sent him on what would turn out to be a life-changing buying trip to Italy, where he got an idea that would transform the American coffee scene.
 
“He was so struck by the community, the environment, the sense of place” in Italian coffee bars, says Koehn. “He came back all exuberant.”
 
But convincing fast-moving Americans to sit down and relax in a coffee shop (after paying $4 for a cup of joe) was no easy task.  People liked the coffee, but they didn’t like the branding – the stand-up bar, the opera music, the baristas in bow ties and white shirts. Initial versions of the revamped Starbucks had “more mistakes in it than early victories,” says Koehn.
 
Ultimately, Schultz proved to be an innovative CEO at a vanguard company, in the same way that Ray Kroc transformed American eating habits as the head of McDonald's. But is Starbucks now too big and corporate to participate in social change?
 
Over the past few years, Schultz has received blowback for using his company to draw attention to pet political issues. In 2012, Starbucks printed the phrase “Come Together” on every cup of coffee sold in the District of Columbia, to send a message to Congress about the national debt crisis.
 
“He’s been taken to task for projecting, or stamping, these particular causes onto Starbucks,” says Koehn. His critics, she says, ask why a publicly-traded company has wandered into the political space at all.
 
But that move into politics might be as much a business decision as it is a personal one. “Increasingly, consumers are voting based on knowledge that’s accessible on their smartphones and on the Internet, about how companies do business,” says Koehn.
 
“The footprint he’s creating for Starbucks – as controversial as it is – is one for the future,” she says. “We don’t know if he’s right or not. It’s a big bet.”

Howard Schultz, Business, Nancy Koehn, Starbucks, coffee

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