Onward: How Starbucks Fought for Its Life Without Losing Its Soul

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Onward: How Starbucks Fought for Its Life Without Losing Its Soul Page 39

by Howard Schultz


  move to semiautomatic machines, 2000, 121

  Essential Baking Company, Seattle, 279

  Ethics. See also Social responsibility

  in coffee sourcing,* 19–20, 72

  at core of Starbucks’ values, 5

  Ethos Water, 19, 119, 189

  Etkin, Billy, 227–28

  Expansion and growth

  abroad, 306

  capability to refocus on, 2009, 301

  in China, 322

  concerns about mentality of, 22, 23, 35

  in early 2000s, 17, 18, 20

  innovation, 35

  new blueprint for, 315–18

  overview of initiatives, 321–23

  questions and strategy upon return as ceo, 65–66, 75

  unique growth model of Starbucks, 317–18

  F

  Facebook, 214–16, 265–66, 298, 320

  Fairtrade, 19–20, 78, 107, 119, 204, 206, 289, 291, 323

  Farmer support centers, 289, 323

  Fei, Helen (partner), 303, 304–5

  Fey, Tina, 214

  15th Avenue Coffee & Tea, Seattle,* 278–80

  Financial analysts

  announcement of return as ceo to, 63–66

  biennial conference with, 2008, 223–36, 326

  investment bloggers, 141

  reactions from, 30, 42, 64, 66, 90–91, 146, 158, 326

  Financial performance. See also Same-store sales data (comps); Stock prices

  at biennial analyst conference, 2008, 230

  first-quarter earnings, 2008, 88–91

  fourth-quarter, 2008, 218

  negative comps in December, 2007, 49

  net earnings, 2007, 41

  operating margin, 2009, 298

  operating margin, 2010, 315

  prediction for 2009, 218

  revenue, 2000, 16

  revenue, 2005, 20

  revenue, 2007, 41

  revenue, 2008, 218

  revenue, 2010, 315

  second-quarter earnings, 2008, 144, 145, 164–65

  third-quarter earnings, 2008, 179

  third-quarter earnings, 2009, 297–301

  Financial Times, 70

  Fingeroth, Jim, 43–45, 48

  First and Pike store, Seattle,* 275–76

  First-quarter earnings conference call, 2008, 88–90

  Fiscal reports. See Financial reports

  Fisher, Robert, 222

  Fleischmann, Patty, 222

  Fleischmann, Steve, 222

  Food-service business, 234

  Forbes.com, 159

  Ford Motor Company, 223

  Fortune, 159, 260

  “$4 latte,” 146, 212

  Franchising consideration, 174–75

  Frappuccino, 76, 164, 240, 245–46, 307, 308

  Fukuda, Yukiko (partner), 116

  Full City roast, 84

  G

  Gaba, Hal*

  Gale, Tony (partner), 277

  GameStop, 267

  Gange-Harris, Cindy (partner), 180

  Gass, Michelle (senior leadership team),* 37, 72–73, 105–6, 133, 140, 143–45, 178, 195–98, 203, 205, 213, 220, 225–27, 230–31, 255–56, 268, 307–8, 316

  General Motors, 223

  Genius Loves Company album,* 21

  Gentilly neighborhood, New Orleans, 199

  Gibbons, Peter (senior leadership team),* 105, 178, 185–90, 213, 219, 225, 254

  Gilbert, Sarah, 141

  Gillett, Stephen (senior leadership team),* 177, 205, 225, 266–69

  Glass, John, 42

  Glickman, David, 73

  Global Fund, 203

  Global Green USA, 19

  Global leadership summit, Seattle, March 2008, 102–15

  Gore, Al, 18

  Gorlick, Harold, 129

  Greenberg, Herb, 70–71

  Greenberg, Marc, 65, 326

  Greenspan, Alan, 130–31, 223

  Grinding beans, 86–87, 132, 135, 319

  H

  Hanley, Dervala (senior leadership team),* 326

  Hansberry, Jeff (senior leadership team),* 317, 325

  Hay, Dub (partner), 105, 197, 313–14

  Health-care benefits, 13, 31, 51, 63, 67, 72, 119, 148, 293–94

  Heifer International, 293–94

  Henninger, Daniel, 163

  Herndon, Wanda, 28, 46, 51, 60, 100, 143, 195, 225

  Heydon, Scott (partner), 281–82, 284

  Hike for KaTREEna, 199

  Hobson, Mellody (board member),* 220, 301

  Hollygrove neighborhood, New Orleans, 199

  Holmes, Kalen (senior leadership team),* 325–26

  Home Depot, 89

  Hornall Anderson, 256–57

  Hostek, Lauren, 222

  Hotel Rwanda, 18

  Howell, Josh (partner), 283–84

  Hulett, Randy, 91

  Human connections. See also Community; Social responsibility

  at core of Starbucks’ values, 5, 13, 23–24, 117–18, 190–91

  at heart of being a merchant, 273

  Jim Donald's fostering of, 20–21

  in Milan coffee bars, 10

  in mission statement, 113

  partners’ generosity of spirit, 116–17

  relevance during recession, 159

  in Seven Big Moves, 107, 320–21

  Hurstak, Gina (partner), 207

  Hyatt hotels, 18

  I

  IdeaStorm site, 124

  Il Giornale coffee bars, 10–11, 44, 56, 251–252

  An Inconvenient Truth, 18–19

  Independent coffee houses, competition from, 212, 277

  Innovation

  author's encouragement of, 28, 32, 87, 110–11, 175, 240–42, 261, 315

  in China, 306–8

  Clover coffee machine,* 91–95, 135, 142, 309, 319

  commitment to, 56, 65

  Digital Ventures business unit, 268, 269–70, 320–21

  Frappuccino, 76, 164, 240

  future plans for, 315–16

  health-related, 166–67

  Lean techniques, 281–85, 321

  Mastrena espresso machine, 121–22, 131–32, 309, 319

  Mazagran carbonated coffee drink, 239–40

  MyStarbucksIdea.com, 135

  Pike Place Roast,* 81–82, 85–87, 135, 142–44, 319

  “Responsibly Grown. Ethically Traded.

  Proudly Served.” marking, 132–33

  rewards program, 133–34, 165–66, 263

  in Seven Big Moves, 107–8, 319

  Sorbetto, 140–41, 165, 167–69

  Starbucks Digital Network,* 320–21

  Starbucks Reserve coffee*

  store designs,* 273–80, 322

  Treat Receipt, 166, 263

  VIA,* 242–61, 316, 318

  Vivanno,* 167, 190, 233

  Instant coffee. See also JAWS (just add water and stir); VIA

  author's use during Africa trip, 246–47

  defying the stigma of, 254, 257–58

  development by Don Valencia, 242–43

  market for, 252–53

  popularity outside the US, 259

  IntranetBlog.com, 142

  J

  Jakobsen, Laura, 256

  Japan

  gratitude for partner equity in, 17

  Tokyo store as first outside North America, 16

  VIA market potential in, 259

  JAWS (just add water and stir). See also Instant coffee; VIA, 244–48, 316

  Jobs, Steve, 71

  Johnson, Aimee (partner), 254–57

  Johnson, Kevin (board member),* 266

  Jones, Tom (partner), 247

  Jumpstart literacy program, 19

  K

  Katzenberg, Jeffrey, 222

  Kavanaugh, Amy, 143

  Kekst and Company. See also Fingeroth, Jim, 43–45, 296

  Kent, Nancy (partner), 25, 27–58, 62, 71

  Kidney donation by partner, 117

  Kuchinad, Chet (partner), 45–46, 48, 145, 1
78, 222

  Kurtz, Ann-Marie (partner), 131–32

  L

  La Marzocco espresso machines, 121

  Lamb, Harriet, 289, 291–92

  Lang, K. D., 129

  Layoffs, 154, 156, 170–72, 174, 193, 218, 223, 263

  Leadership conference, New Orleans, October 2008*

  author's commitment to, 78, 192–93

  author's speeches at, 201–2, 205–6

  Bono's appearance at, 202–5

  closing general session, 196, 201–6

  costs and risks of, 193, 196

  interactive galleries at, 196–98

  New Orleans chosen as site of, 193

  number of participants at, 194

  significance and success of, 193, 206–207

  street fair during, 196

  volunteer events during,* 196, 198–200

  Leadership summit, 2008. See Global leadership summit, Seattle, March 2008

  Lean techniques, 219, 281–86, 298, 309, 321

  Lear, Norman,* 210, 222

  Lee, Olden (board member),* 220, 222

  LEED certification,* 276, 324

  Lehman Brothers, 146, 183

  Levine, Jonathan, 222

  Levine, Stacey, 222

  Levitan, Dan, 222

  LinkedIn, 321

  Linnemann, Andrew (partner), 85, 135, 247–48, 313–14

  Linz, Doron, 222

  Linz, Kai, 222

  Loans to coffee farmers, 289

  Lorenzi, Aldo, 273, 275, 280–81

  Lorenzi, Coltelleria G., 271–73

  Loyalty program. See Rewards program

  Lubars, David, 208–212

  M

  Maglaya, Ruben (partner), 327–28

  Malanga, Mike (partner), 152–54, 161–62, 277

  Mandelson, Peter, 264–65

  Marinopoulos, Panos, 222

  Marriott hotels, 18

  Mastrena espresso machines, 121–22, 131–32, 309, 319

  Mazagran carbonated coffee drink, 239–40

  McCain, John, 209, 214

  McCartney, Paul, 103, 129

  McCormick, Pete, 222

  McCutchen, Matt, 222

  McDermet, Jim (partner), 185, 186

  McDonald's, 62–63, 85, 146, 212, 232, 277

  McPherson, Christina (partner), 289

  Media reactions to events. See also Press statements

  doubts about Starbucks’ future, 102

  leaked memo of February, 2007, 27, 29–31

  news about VIA, 258

  return as ceo, 70–71

  stores closing down, 158–59

  stores closing for training, 4, 6

  third-quarter earnings, 2009, 301, 303

  VIA introduction, 259–60

  Melville, Herman, 11

  Memos

  “The Commoditization of the Starbucks Experience” (February, 2007), 9, 23–32, 44

  to Il Giornale employees, 10–11

  on store closings, to partners, 157–58

  Transformation Agenda Communications, 100–1

  “The Transformation of Starbucks” (January, 2008), 61

  Mercantile stores, 278–80, 322–23

  Merrill Lynch and Company, 184

  Mission Statement, 111–15 partners’ signing of*

  Moby Dick, 11

  Moratti, Angelo, 271–73

  Mordos, Jeff, 211–12

  Morgan, Todd, 222

  Motley Fool, 159, 258

  Mukamwiza, Immaculate, 292, 323

  Muller, Liz (partner), 277

  Music business. See Entertainment

  MyStarbucksIdea.com, 135, 142, 166, 231, 265, 320

  My Starbucks Rewards program. See Rewards program

  N

  Nasdaq, 50

  Nelson, Brad, (partner) 214, 216

  New Orleans, Louisiana.* See also Leadership conference, New Orleans, October 2008 193–96,* 198–200, 206, 324

  New York Times

  on fall of financial institutions, 184

  as Starbucks Digital Network content, 321

  on VIA, 259

  Nickelodeon, 321

  Nocera, Joe, 259

  Nordstrom, 89

  Nosler, Zander, 91–95, 135

  O

  Obama, Barack, 209, 263, 266

  O'Brien, Linda (partner), 293

  Ogawa, Chihiro (partner), 116–17

  Olive Way store, Seattle,* 323

  Olsen, Dave (partner), 10, 112, 242

  O'Neil, Valerie (partner), 27, 62, 195

  Onward

  connotation of, 179

  first use in Il Giornale memo, 11

  use in Transformation Agenda Communications memos, 101

  on volunteers’ clothing in New Orleans, 200

  Open forum

  about layoffs, 170–72, 176

  described, 99

  reinstatement of, 99

  in Shenzhen, China, 303–5

  after store closings announcement, 158

  P

  Packard, Ben (partner), 119, 125

  Palace Ballroom, Seattle. See Brainstorming retreat Palin, Sarah, 209, 214

  Palmer, David, 63–66, 90

  Paris, France

  Disney Village store, 276

  opening of first store in,* 17

  Partners

  announcement of return as ceo to, 58–61

  author's personal calls to, 99

  author's sense of responsibility to, 15

  Braille menu created by, 116–17

  concerns about growth, 22

  delivering on the unexpected by, 40

  diversity among, 148

  emotional connections fostered in, 117–18

  Espresso Excellence Training for,* 3–7, 78, 104

  galleries at leadership conference, October 2008, 198

  generosity of spirit in, 116–17

  health-care benefits for, 13

  kidney donation by, 117

  lack of training and inspiration for, 77

  layoffs for non-store positions, 170–72, 174

  layoffs with store closings, 154

  Lean implementation by, 281, 282–84

  memo on store closings to, 157–58

  regarding mission statement, 113–14

  number in 2008, 131

  personal nature of their job, 201

  reactions to memo of February, 2007, 28–29

  stock option benefits for, 13, 17

  volunteer service by, 323–24

  volunteers in New Orleans, 2008,* 196, 198–200

  Peterson, Peter G., 184

  Pfeiffer, Tim (partner), 278

  Pike Place Market store, Seattle,* 44, 55–57, 86, 110

  Pike Place Roast*

  author's first taste of, 81–82

  beans ground in store for, 86–87, 135

  code named Consistent Brew, 85

  development of, 85–86

  launch of, 142–44

  origin of name, 86

  positioning of, 86–87

  presentation at annual shareholders’ meeting, 2008, 135

  second-quarter sales, 2008, 146

  success of, 319

  as symbol of transformation, 87

  Plan B for cost management, 218–19, 223, 286

  Point of sale (POS) system, 150–51, 325

  Postconsumer recycled fiber use, 118–19

  Prentice, Arnie, 129

  Press releases

  on Espresso Excellence Training, 78

  on return as ceo, 61

  on store closings, July 2008, 157

  (PRODUCT) RED, 203, 266, 295

  Project Greenstorm, 125–27

  R

  Recession. See also Closing of stores, July 2008

  declining sales related to, 88–89, 146

  fall of financial institutions, September 2008, 183–84

  layoffs related to, 154, 170–72, 174

  new realities uncovered by, 223

  overseas expansion slowed by, 218

&nbs
p; status in February 2009, 263

  (RED)

  partnership with, 203, 205, 266

  (RED) Friday in stores, 294–95

  Respect

  earned by social responsibility, 18–19

  as touchstone of Starbucks, 4–5

  Retirement plans, matching of funds made discretionary, 2008, 300

  Return as ceo, 42–52, 55–68

  announcement to partners, 58–63

  announcement to senior leaders, 57–58

  author's readiness for, 52

  commitment to innovation and reinvention, 56

  conference call to shareholders and analysts, 63–66

  Kekst and Company consultation, 42–45

 

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