Onward was primarily about Starbucks’ transformation period and thus the story heavily focused on our US business even though the company's ongoing success is also due to our joint-venture partners and licensees around the world, many of whom I have known and called friends for years: in Japan, Yuji Tsunoda of the Sazaby League; in Spain, Plácido Arango's Grupo Vips; in Mexico, Alberto Torrado of Grupo Alsea; Starbucks’ business partner for the Middle East, Turkey, and Russia, Mohammed Alshaya's M. H. Alshaya; in the Philippines, Jun and Menchu Lopez, owners of the Rustan Group; the Marinopoulos Group in Greece, Cyprus, Austria, Switzerland, and Romania, run by Panos Marinopoulos; in Hong Kong and parts of China, Michael Wu and the Maxim Group; in Taiwan and other regions of China, John Hsu of UniPresident Group; in Indonesia, V. P. Sharma of P. T. Mitra Adiperkasa; in Perú, Alfredo de Ferrari Morello's Delosi Group; and Henry McGovern of AmRest, Starbucks’ business partner for Central Europe. Also, Fred Hazelwood of the John Bull Group in the Bahamas; I. C. Hur from Shinsegae Corporation in South Korea; Russel Creedy of Restaurant Brands New Zealand; and in Malaysia, Francis Lee with Berjaya.
Finally, not a day goes by when I do not think about Starbucks’ tens of thousands of partners. Their hard work and fortitude transformed the foundation of our business, and the values, the passion, and the ideas that they show up to work with every day are what makes us such a special organization. For all they do, my heartfelt thanks.
From the coauthor
In addition to the above, I would like to thank my parents, David and Virginia Gordon, for that little blue typewriter and a lifetime of unconditional love. My son, Theo, for his laughter and patience. And Matthew, for his support in every season of our lives.
For helping me find my own balance, thanks to my loving sister Susan and her husband, Howard; my surrogate Seattle family Katie Bedford and Sherri, Tom, and Maggie Brothers; as well as dear friends Kim B., Adrienne K., Caroline R., Julie Z., Mary Anne S., Lynn H., Lori S., Jamie K., Cari S., Lindsay P., Leigh G., Sam K., Cate H., Ben D., Dan M., Lois W., Ilysa G., and, as promised, Ellen A. A special thanks to Tonya Kimbrough of Pronto on eight, whose smile brightened my days.
I am grateful to my literary agent Stuart Krichevsky for years of wise counsel, commitment to excellence, and understanding. Stuart is a true professional in the publishing world.
Finally, to Howard Schultz. His honesty, focus, generosity of spirit, compassion for others, trust in me, and desire to tell Starbucks’ story for all the right reasons made collaborating on his book one of the most rewarding experiences of my career. Howard gave me unfettered access to Starbucks’ partners, whose high standards, intelligence, and kindness are, I believe, reflections of his leadership. After more than a year of sharing Howard's past and present, I feel compelled to paraphrase the talented writer Dori Jones Yang, who worked with Howard on his first book: Howard Schultz truly is the man he set out to be.
Photo credits
Where it all began, in 1971
1 Jeff Corwin
2 Nick Gunderson
3 James McFarlane
Rwanda
1, 5, 6 Jonathan Torgovnik
2, 3, 4, 7, 9 Riccardo Gangale
8 Chris von Zastrow
The proof is in the cup
1, 5 Geoffrey Ellis
2 Paul J. Richards/Getty Images
3, 4 Keith Bedford
Returning to our heritage
6, 7 Young Lee
Ethically sourced coffee
1 Jonathan Levine
2 Martin Thiel
3, 7 Michael Hanson Photography
4, 9 Sam Knight
5, 6 Stanley Hainsworth
8 Starbucks Coffee Department
The Starbucks Experience
1 Young Lee
2 Rob McDougall
3a, 4b Aaron Leitz
3b, 3c Major Cohen
4a Armstrong Photo
5a, 5b Touch Worldwide
6, 7 Zhang Tong
8 Kirsha Baldwin
9 Martin Coles
10 Árpád Földházi
11, 12 Colm Pierce
Taking it personally
1, 2, 3, 6, 7, 8 Touch Worldwide
4 Kevin Mazur/Getty Images
5 Matt Peloza
Reimagining our future
1, 7 Rubin Photography
2, 3, 5, 6 SYPartners
4 Matthew Mar
Innovation
1, 13 Young Lee
2 Aaron Leitz
3, 4b Starbucks Coffee Company
4a, 7b, 12 Armstrong Photo
5 Geoffrey Ellis
6 Haley Munro
7a Courtesy of the Valencia Family
8 Courtesy of Starbucks Japan
9 Courtesy of Concord Music Group
10 Iridio
11 Ralph Alswang
Onward. . .
1 John Keatley
2 Gregg Segal
Automat photo (at front of book) Courtesy of the Hardart Family
Index
An asterisk (*) indicates that photos are shown in the insert pages.
* * *
A
AdAge.com, 259–60
Advertising
decision to be proactive, 211–12
election-themed ad, 208–11, 212–16
multichannel marketing campaign, 298
traditional, 211
Allaire, Paul, 71
Alshaya, Mohammed, 222
Alstead, Troy (senior leadership team),* 95, 225–26, 228, 230, 299
Ames-Karreman, Jennifer (partner), 10
Analyst conference. See Biennial analyst conference, 2008, 2010
Analysts. See Financial analysts Andersen, Sandie (partner), 117–18
Anderson, Jack, 256
Annual shareholders’ meeting, 2008
author's backstage thoughts about, 128–30
author's opening speech at, 130–35
Clover presented at, 135
Conservation International presentation at, 132–33
description and importance of, 129, 136
K. D. Lang's appearance at, 129
Mastrena espresso machine demo at, 131–32
MyStarbucksIdea.com presented at, 135
Pike Place Roast presented at, 135
rewards program presented at, 133–34
Apple, 32, 146, 321
Arabica coffee beans, 8, 20, 83, 242, 291
Arango, Plácido,* 272
Ashby, Marty, 110
AT&T, 146
Ausnes, Annamarie, 117–18
Automat, 33–34
B
Bank of America, 89, 184
Baristas. See Partners Barnes & Noble, 18
Barr, Tom (partner), 327
Bartiromo, Maria, 262–64
Bass, Barbara (board member),* 220
Bates, David, 256
BBDO
election-themed ad by, 208–16
multichannel marketing campaign with, 298
relationship established with, 211–13
Bean Stock. See Stock options Beatles, The, 70, 73–75, 79, 103
Beecher's Handmade Cheese, 79, 110
Behar, Howard, 40
Benioff, Marc, 124–25
Bennett, Tony, 129
Bennis, Warren, 252–53
Bernash, Amy (partner), 281–83
Bernstein, Jeffrey, 146
Biden, Joe, 209
Biennial analyst conference, 2008
author's closing speech, 235–36
as opportunity to regain credibility, 223
planning for, 226–29
positive outcome of, 235
presentations at, 229–31, 233–34
Biennial analyst conference, 2010, 326
Binjiang store, Shanghai, China*
Blizzard Entertainment, 267–68
BloggingStocks.com, 141
Board of directors*
author's relationships with members, 222–23
further store closings suggested by, 153
–54
initial consideration about return as ceo, 41
members’ background and experience, 220–21
Plan B, role of, 219, 223
request for financial modeling of negative comps, 218
store closings, role of, 152–54
Bobo, Carol, 129
Boggs, Paula (senior leadership team),* 178
Bono, 202–5
Bradley, Bill (board member),* 220, 229
Braille menu for visually impaired, 116–17
Brainstorming retreat
Beatles theme at, 70, 73–75, 79
participants in, 73
SYPartners, 72–73
visits to Seattle retailers during, 78–79
Breakfast sandwich, 36–38, 89–90, 231
Brewer, Brady (partner), 257
Broadmoor neighborhood, New Orleans, 199
Brotman, Adam (partner), 268–70
Brotman, Jeff, 222
Bruzzo, Chris (partner), 125–127, 135, 142, 146, 215, 269
Buckley, Joe, 65
Budapest store, Hungary*
Burrows, Cliff (senior leadership team),* 73–74, 108–9, 140, 142–43, 145, 149, 151, 158, 160, 161, 167–69, 173, 178, 189, 190, 194, 197, 205, 213, 219, 225–26, 228, 233, 248, 284
BusinessWeek, 70
C
C.A.F.E Practices, 20, 120, 291, 323
Camera, Paul (partner), 121
Camus, Albert, 7
Casey, Michael, 131, 225–26
Charitable efforts. See Social responsibility
Charles, Ray, 21
Chenghuang Miao store, Shanghai, China* China
entrepreneurial spirit in, 305
expansion in, 322
innovation in, 306–8
as largest market outside US, 305
newspaper copies given to author, 311
open forum in Shenzhen, 303–5
speech in Hangzhou, 309–10
Starbucks stores in,* 17, 103, 305
Christian Science Monitor, 159
Circuit City, 223
Citigroup, 89
City Park, New Orleans, 199
Clinton, Hillary Rodham, 209
Closing of stores, 152–163, 263
Closing of stores for espresso training,* 3–6, 78, 104
Clover coffee machine,* 91–95, 135, 142, 309, 319
Coffee
Arabica versus Robusta, 83
aroma in stores, 24, 36–37
author's experience in Milan, 9–10
Clover coffee machine,* 91–95, 135, 142, 319
customization of, 134
Espresso Excellence Training,* 3–7, 78, 104
espresso machines, 24, 120–22, 131–32
ethical sourcing of,* 19–20, 132–33
farming, skills required for, 288–89
journey from soil to cup, 82–84, 197
manual versus automatic espresso machines, 120–21
in mission statement, 112
Pike Place Roast,* 81–82, 85–87, 135, 142–44, 319
“Responsibly Grown. Ethically Traded. Proudly Served.,” 133
roasting and blending coffee beans, 84–85
in Seven Big Moves, 106, 319, 323–24
Tribute Blend, 313–14, 327–28
Coffee cherry, 83
Coffey, Kevin, 190–91
Cohen, Major (partner), 279
Colbert, Stephen, 6
Colette, Paris, 34
Commerce Center store, Vancouver, WA, 281
“The Commoditization of the Starbucks Experience” memo (February, 2007)
drafting of, 9, 23–25
leaking of, 26–27
lessons of, 28, 31–32
media reaction to, 27, 29–31
partners’ reactions to, 28–29
press statement about, 27–28
Community. See also Human connections; Third place
donations to local communities, 19
election-themed ad, 216
locale reflected in stores,* 147–48, 306–8
local relevancy, in Seven Big Moves, 107
in Milan coffee bars, 10
in mission statement, 113
as touchstone of Starbucks, 4–5, 13
volunteer service by partners, 323–24
volunteers in New Orleans, 2008,* 196, 198–200
Competitors, 4, 6, 62–63, 146, 212
Comps. See same-store sales data
definition of, 35, 42, 49
Computers. See also Technology
Concord Music Group, 21, 146
Conservation International
C.A.F.E Practices program, 20, 120, 291, 323
enhanced support for, 119–20
presentation at annual shareholders’ meeting, 2008, 132–33
Starbucks’ partnership with, 19
Consistent Brew, 85–86. See also Pike Place Roast
Consumer packaged goods (CPG)
opportunities from, 233, 316–17
performance of, 146
Consumer Reports coffee taste test, 2007, 85
Corporate responsibility. See Social responsibility
Costa Rica, farmer support center, 289
Cost management. See also Plan B
analyst conference report on, 2008, 230
continuing efforts in, 263, 325
layoffs required for, 170–72, 174
leadership team meeting about, 173–74
plans for 2009 (Plan B), 218–19, 223, 286
Countrywide Financial, 89
Cows for Rwanda, 292–93, 323
CPG. See consumer packaged goods
Crescent City Art Project, 199
Cromett, Sherry (partner), 194
Culver, John (senior leadership team),* 322, 325
Customers. See also Rewards program
better understanding of, 110, 166, 197
“Bob” and “not Bob,” 198
election-themed ad, 215–16
feedback from, 135, 166, 231, 265, 320
gallery at leadership conference, October 2008, 197–98
initiatives to reignite emotional attachment with, 66–67, 124–25
Lean techniques improving service to, 282–86, 321
in mission statement, 113
D
Dammeier, Kurt Beecher, 79
Davenport, Terry (partner), 119, 133–34, 143, 208–10, 212–13, 226, 228, 231–33
David, Nicole, 222
Dell, Michael, 48–49, 123–24
Digital Ventures business unit, 268–70, 320–21
Disney Village store, Paris, France, 276
Donald, Jim , 20–23, 25, 27, 29, 35–37, 40, 44, 46, 50, 58–60, 62, 173
Donations. See Social responsibility Donlan, Tim (partner), 62
Douglas, Tom, 279–80
DreamWorks, 50
Driscoll, Kristen (partner), 284–85
Dunkin’ Donuts, 62, 212
E
Earnings. See Financial reports; Same-store sales data (comps)
Edelman (public relations agency), 143
Edgewater brainstorming session, 2007, 35–36
Edinburgh store, Scotland* Egan, Mary (senior leadership team),* 326
Eight-Minute Cadence, 284–85
Election-themed ad
author's first view of, 210
BBDO conceived of, 211–13
goodwill generated by, 215–16
NBC SNL spot for, 213
social media setup for, 214–15
store preparations for, 213
Emotional connections. See Human connections
Engskov, Kris (partner)*
Entertainment
overhaul of strategy for, 145–46
Starbucks's expansion into, 21
Entrepreneurs, 8–9, 38, 305
Environmental concerns. See also Sourcing
climate change, 119–20
LEED certification for stores,* 276, 324
overview of initiatives, 324
po
stconsumer recycled fiber use, 118–19
in Seven Big Moves, 107, 324
in store designs, 275–78
Equity. See Stock options
Espresso Excellence Training
benefits for customers, 7
coffee quality scores improved by, 6–7
decision-making for, 4–5, 78
media reaction to, 4, 6
press statement for, 78
US stores closed for,* 3–6, 78, 104
Espresso machines
automated, 24, 121, 122
change to Mastrena machines, 121–22, 131–32, 309, 319
manual versus automatic, 120–21
Onward: How Starbucks Fought for Its Life Without Losing Its Soul Page 38