Thursday, January 17, 2008

Howard Schultz's cup of tea

Now that the steam has cleared from Starbucks’ recent changes, a few conclusions can be drawn about Howard Schultz: The Second Cupping. For one thing, memo writing may be entering its heyday. The Brooklyn native’s reliance on the TO:/FROM: format is the stuff of “Dilbert.” Within hours of replacing Jim Donald as top bean, Schultz was posting notes to customers, employees and investors via Starbucks’ website. The messages echoed the themes he’d sounded in the Jerry Maguire-esque memo that was sent to management last February, urging the chain’s handlers to re-find their souls and save the specialness of Starbucks. The minute it was leaked to the world via, Donald should’ve started punching up his resume.

If Donald is smart, he’ll appreciate what Schultz was demonstrating with that fit of keyboard pounding last week. Schultz promised each constituency a basket of changes that amounted to reconnecting with each. The adjustments he previewed—in essence, paying less attention to bean counters to focus more on the beans—were reassurances that Starbucks hears their gripes. His high-communication style put some steel in the promise of re-forging a strong relationship, the foundation of what Schultz reverently calls the Starbucks Experience.

Contrast that stance with Donald’s approach. If his public appearances and interaction with journalists were accurate lenses, he absorbed his candor and interactive skills from Richard Nixon. A fellow veteran of the media said her interview with Donald was the most boring one in her considerably long career. The time I saw him address an industry group, he came across as a suit in casual clothing, carefully following a Communications Department script to profess his daring New Age convictions.

I’ve also had the privilege of hearing Schultz speak, some 10 or 12 years ago by now. A side effect of being a business journalist is attending conferences where the celebrity draw could be anyone from Gerald Ford to Dennis Miller to Dolly Parton. None of them came close to Schultz in inspirational quality. Because keynoters of that wattage seldom deliver news fodder, their speeches are usually the times when you check phone messages or raid the break tables outside the lecture hall. Indeed, I’m not sure I would have hung around to hear Schultz if it hadn’t been for the draw of Starbucks coffee being available while he spoke.

But once he started explaining how his father’s miserable experiences as a diaper-service driver had shaped his strategy for Starbucks, there was no leaving the ballroom, by me or anyone else. He spoke passionately about the need to balance business needs against doing the right thing for employees and cultivating a culture of which you can be proud—the same themes he’d thump in the February memo.

If it was an act, as contrived as any performance on the high-ticket speakers’ circuit, it was of Daniel Day Lewis quality. And any skepticism was completely dashed when I saw Schultz’s handlers lead him down the stage and straight toward the doorway next to which I was standing. I stepped out, stuck out my hand, and blurted, “That was great.” Then I noticed he was sweating a bit, and seemed a little quivery. He stopped dead.

“Do you really think it was alright? I sounded okay? I was kind of nervous,” he rattled.

I gaped at him, wondering for a second, Is this really him? Did I stop the wrong guy, maybe a speaker from an earlier session? Nope, definitely Howard Schultz.

“Yeah, you were great. I really mean it,” I assured him.

He broke into a huge smile, vigorously shook my hand, said, “Thanks. Thanks a lot,” and was yanked away by his handlers.

I went from there to a book store to look for a copy of his autobiography.

Persons who have worked for him have since advised me to remember that he started as a salesman and is a businessman before all else. Take him and his change-the-world manifesto with a dash of skepticism, they advised.

But, as they readily acknowledged, demythification doesn’t detract from his unique approach to running a business, nor from the specialness of Starbucks’ culture during his first go-round as CEO. Even his handling of last week’s coup was a marked departure from the usual deposing of a big-company chief. With the blandness fostered by Sarbanes-Oxley and the threat of shareholder lawsuits, you can only hope he indeed proves to be the Harry Potter of the restaurant business.

But just to make sure, I think I may head back to that book store. Maybe I can buy him an inspirational book about Steve Jobs.

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