Transformation Initiatives at Starbucks

A previous post was a brief look at the bold Transformation Agenda that Starbucks put into place early in 2008 to overcome their decline. The Agenda contained a mission statement and 7 Big Moves designed to return Starbucks to success.

Within a few months, at their April 2008 shareholders meeting, Starbucks rolled out the following six transformation initiatives:

  • The Mastrena – a finely crafted, Swiss made espresso machine that would provide baristas with the ability to give customers a high-quality consistent shot of espresso second to none, transforming the espresso experience in their stores. By the end of 2008 the machine was in 30% of stores, and by 2010 a majority of Starbucks had the Mastrena.
  • Conservation International – a partnership with CI, begun in 1998, was expanded so that Starbucks could buy fair-trade coffee, produced in shade-grown conditions with fair compensation and safe working conditions for coffee farm workers. By 2009, all Starbucks espresso beans and espresso-based products would qualify for a new marking designed to articulate their practices: Responsibly Grown. Ethically Traded. Proudly Served.
  • The Rewards Card – designed to recognize their most loyal customers with freebies, the Card addressed an emerging need for value. Existing Starbucks Card holders could register their cards online, instantly turning it into a Rewards Card.
  • MyStarbucksIdea.com – an interactive website designed to listen to customers suggestions, rants, and comments. Moderated by 50 veteran Starbucks employees, the website was launched live by uploading ideas submitted by shareholders that morning. Within minutes, more ideas came streaming in from people listening to the meeting’s broadcast or following rolling blog posts. In the next 24 hours, over 7,000 ideas were posted.
  • Pike Place Roast – announcing that Starbucks would once again grind whole beans in their stores, two master baristas introduced Pike Place Roast, a smooth, well-balanced, lighter blend of coffee, designed to give full flavor while not being as bold as traditional blends.
  • Clover – a commercially viable way to replicate the benefits of the French Press method of brewed coffee, Clover was a local invention acquired by Starbucks early in 2008. It created a fantastic cup of coffee at a pace designed to keep up with the demand of most Starbucks stores.

SB turnaround menu fastcompany.com

Seven Big Moves.

Six Transformation Initiatives.

All of these engaging tools that helped Starbucks navigate through a very unpredictable journey, one milestone at a time.

The initiatives introduced at that meeting each heralded a return to the core values of Starbucks – coffee, customers, innovation, and values – but they weren’t enough by themselves to bring the company back from the brink.

Painfully personal decisions were the final step in the transformation.

Lessons for ChurchWorld

  • Take a look at the initiatives above, and translate them into your world. What actions can you dream up – and then put into action – that would help you accomplish your transformation agenda?
  • Are you secure enough in your core values to put anything – and everything – on the table?
  • Transformation is not just about nuts and bolts, about systems and processes. Is your vision lived out in the lives of your people?

an updated post from a series reviewing Onward, by Howard Shultz

Onward

preparation for a new series coming soon on Leading the Starbucks Way, by Joseph Michelli

Print

 

Ones Add Up

Starbucks’ CEO Howard Schultz’s 2011 book Onward details the amazing comeback story of Starbucks: after more than three decades of success, in 2008 they found themselves with sales sliding at a distressing rate, a falling stock value, and relentless competition. Compounding the problem, the world’s economy was in a tailspin.

With aggressive, sometimes painful moves and a powerful transformation agenda to guide them, they were able to reverse their decline, and by the end of 2010 were once again on top of their game.

What happened?

Here’s an excerpt from the book that gives you a big clue:

Like a doctor who measures a patient’s height and weight every year without checking blood pressure or heart rate, Starbucks was not diagnosing itself at a level of detail that would help ensure its long-term health. We predicated future success on how many stores we opened during a quarter instead of taking the time to determine whether each of those stores, would, in fact, be profitable. We though in terms of millions of customers and thousands of stores instead of one customer, one partner, and one cup of coffee at a time.

With such a mind-set, many little things dangerously slipped by unnoticed, or at least went unacknowledged. How could one imperfect cup of coffee, one unqualified manager, or one poorly located store matter when millions of cups of coffee were being served in tens of thousands of stores?

We forgot that “ones” add up.

courtesy freemarketmediagroup.com

courtesy freemarketmediagroup.com

Lessons for ChurchWorld:

  1. What “business” are you in?
  2. What are the roots of that business?
  3. It’s okay to have a 30,000 foot view, but eventually you’ve got to land the plane.
  4. You’ve got to produce results.
  5. You may see the crowds, but never forget the “ones“.

an updated post from a series reviewing Onward, by Howard Shultz

Onward

preparation for a new series coming soon on Leading the Starbucks Way, by Joseph Michelli

Print

 

Change is…

Healthy.

Organizations are not alive in a literal sense – but they have to change and adapt in order to stay alive.

Nancy Duarte, writing in “Resonate,” talks about the life cycle of organizations – start-up, growth, maturity, and eventually decline. But it doesn’t have to be that way.

An organization should make continual shifts and improvements to stay healthy.

In order to do that well, leaders must excel at persuasion.

Movements are started, products are purchased, philosophies are adopted, subject matter is mastered – all with the help of persuasive presentations.

Presentations create a catalyst for meaningful change by using human contact in a way that no other medium can.

Go ahead – change the world.

Defying Gravity

The “rocket ride” comment in yesterday’s post reminded me of some remarks by Andy Stanley when he came to Elevation Church in Charlotte NC for one of our leader training sessions. They are an appropriate reminder as we consider changing change.

Recalling the dispute in Antioch and the resulting Jerusalem Council in Acts 15, Stanley developed the following thoughts about what the church should be vs. gravitational pull of culture.

1. There’s always a gravitational pull toward insiders and away from outsiders

  • You must continue to create empty seats at optimal worship times for the unchurched

People who were nothing like Jesus liked Jesus

2. There’s always a gravitational pull toward law and away from grace

  • Have as few policies as possible and as many conversations as possible

With conversations you can always extend grace

3. There’s always a gravitational pull toward complexity and away from simplicity

  • Do what you do well and do it better than anyone else

Complexity always slows things down, is expensive, and makes you lose distinctiveness in the community

4. There’s always a gravitational pull toward preserving and away from advancing

  • When you start preserving, you are building walls instead of bridges

Back when we had nothing, what would we have done?

If you want to defy gravity:

  • You must be a raving fan publicly
  • You must be an honest critic privately with the right people in the right environment for the right reason
  • You have to be extraordinarily generous

That’s how you keep the church in orbit.

Introducing the Scrum to ChurchWorld

During the course of the past week’s posts I have journeyed from Generation Flux to Adaptability to Nostalgia to Agile Development to a new destination: the Scrum.

It’s actually all part of the same journey: 1) realizing tomorrow is not going to be like yesterday, and 2) What am I as a leader going to do about it?

Back to the Scrum. As a parent of four children, I have been involved in many sports, some for fun, more that were in a league setting. About three years ago, my youngest son-at that time a junior in high school-came home and said he had signed up for the rugby team at school.

 

Okay. New experience, new opportunity for learning.

 

 

In rugby, a scrum is a formalized contest for possession of the ball during a rugby game between the two sets of forwards who each assemble in a tight-knit formation with bodies bent and arms clasped around each other and push forward together against their opponents.

Hold that thought.

Yesterday I suggested that an Agile Manifesto for ChurchWorld needs to be developed. In my research to do just that, what do I encounter but a Scrum – but with a new definition:

In the agile world a scrum is a process framework within which people can address complex adaptive problems, while productively and creatively delivering products of the highest possible value.

I think it’s time to go back to the drawing board.

Learning from the World of Business Bankruptcy and Software Development

Kodak, the iconic company that was synonymous with pictures, has declared bankruptcy.

When that news came out last week, I knew I would be getting around to connecting it to ChurchWorld. James Emery White, pastor of Mecklenburg Community Church in Charlotte, NC, already has: What Business Are You In? is a great post that every ChurchWorld leader needs to read.

As soon as I had finished reading it, my thoughts went back to the Generation Flux cover story from Fast Company that I posted here, here, and here last week. There were several topics that I had marked in it for future research, and one of them ties in nicely to the bankruptcy announcement by Kodak and White’s post.

It’s about being agile.

I’m not talking exclusively about physical agility, the ability to move quickly and with suppleness, skill, and control; I’m not talking only about mental agility, the ability to be able to think quickly and intelligently. It’s really a combination of the two, and more.

Software development used to be developed by what chaos expert DJ Patil called the “waterfall” process:

One group develops the product, another builds visual mockups…and finally a set of engineers builds it to some specification document.

Think Microsoft and their practice of having a designated schedule of issuing large, finished releases of their products (Windows 95, Windows 2000, etc.). Today that process has given way to “agile” development, what Patil calls “the ability to adapt and iterate quickly throughout the product life cycle.” In today’s software world, that concept follows the precepts of “The Agile Manifesto,” a 2001 document written by a group of developers who stated a preference for:

  • individuals and interactions over processes and tools
  • working software over comprehensive documentation
  • responding to change over following a plan

Maybe it’s time for an Agile Manifesto for ChurchWorld.

If Only Things Were Like They Used To Be

Nostalgia is a natural human emotion, a survival mechanism that pushes people to avoid risk by applying what we’ve learned and relying on what’s worked before.

It’s also about as useful as an appendix right now.

That quote is from Fast Company Editor Robert Safian, writing the cover story “Generation Flux” for the February 2012 issue. He goes on to add:

When times seem uncertain, we instinctively become more conservative; we look to the past, to times that seemed simpler, and we have the urge to recreate them. This impulse is as true for organizations  as for people. But when the past has been blown away by new technology, by the ubiquitous and always-on global hypernetwork, beloved best practices may well be useless.

ChurchWorld, to a great extent, finds itself in that situation right now.

There are huge shifts occurring in the economic, social, cultural, and spiritual fabric of our lives right now. That’s not new – change has always been a part of who we as humans are. But what’s different is the pace of change. It’s not just getting faster – it’s accelerating along an exponential curve.

And the response of ChurchWorld?

Put a fence around your facility and charge admission to a museum dedicated to the 1990s – or 1980s – or 1970s – or 1960s – or 1950s – or…

Oh, it’s not that blatant – but it is obvious.

It’s time to change.

My absolute favorite quote about change is from Will Rogers:

Will Rogers quote

To survive THRIVE in this age of flux, you have to claim what makes your church unique, what sets you apart from 10,000 other churches, what God has uniquely gifted your people to be and doHold onto that – and change any and every thing else that needs to be changed in order to live out God’s calling.

Generation Flux

In our hypernetworked, mobile, social, global world, the rules and plans of yesterday are increasingly under pressure; the enterprises and individuals that will thrive will be those willing to adapt and iterate, in a disciplined, unsentimental way.

The above quote by Fast Company magazine editor Robert Safian is the introduction to the cover story on Generation Flux. That cover story, plus several other articles, are a great primer to introduce you to Generation Flux.

Generation Flux is less a demographic designation than a psychographic one: What defines GenFlux is a mindset that embraces instability, that tolerates – and even enjoys – recalibrating careers, business models, and assumptions. Not everyone will join Generation Flux, but to be successful, organizations and individuals will have to work at it.

Clarity evangelist Will Mancini, in a recent post, described five “tweaks” that ChurchWorld leaders need to practice in order to keep their ministry. They are just the kind of actions that Generation Flux can pull off.

Another powerful quote from Safian: “The vast bulk of our institutions – educational, corporate, political – are not built for flux. Few traditional career tactics train us for an era where the most important skill is the ability to acquire new skills.”

To his list above, add ChurchWorld. Then ask yourself, “What am I going to do about it?”

 

 

The Irony of Change

It’s actually pretty ironic.

All week long I have been writing and speaking about “change.” I’m in Dallas for the NACDB annual meeting and the 2011 Worship Facilities Conference & Expo.

Late Thursday afternoon, just as the Expo was closing, my bag with laptop, Kindle, some books, and project files was stolen from our display booth. 5 minutes before it was there; I turned around from talking to someone and it was gone.

It was just a “thing,” not a person. In the grand scheme of things I’ve heard this week and the life stories I’m a part of, it should be no big deal.

But in a whole lot of ways, it was my “life” – certainly my professional life for the last 7 1/2 years, and a majority of my other life – writings, projects, research, church stuff, and a whole lot of things I’m even now trying to remember.

Gone.

I’ve always been a pragmatic, bridge-under-the-water guy. Long a student of history, I’ve thought & told others that what’s happened can’t be changed, that you must live in the present and create your own future.

Sounds good till the only past you have resides in a spotty memory, your present is filled with sleepless anxiety, and the future is dark.

So it’s 4:30 AM, sleep has eluded me, reading just isn’t working, and TV is dreary infomercials and bad news. I’m writing a lot and posting a little via my cell phone to see if I can begin to process what’s going on.

I don’t know – and am having difficulty expressing – what’s going through my head.

But change is here.

Change and What You Do

Change is important.

But it’s also important to cling to core values. Paul experienced that tension, and God helped him to facilitate change while not abandoning his core values. In Acts 16:6-10, Paul is all set to carry the Gospel message to Bithynia – but the Spirit of God redirected him to Macedonia. Change – new direction. But it was only a new direction, not a new message. Paul’s core value was not Bithynia; it was fulfilling God’s desire to expand His kingdom. Because he didn’t confuse his desire (to go to Bithynia) with his core value (to follow God’s call), Paul sailed straight for Macedonia.

In the great book Built to Last, Jim Collins notes that once a visionary company identifies its core ideology, it preserves it almost religiously – changing it seldom, if ever. Collins concluded that:

Core values in a visionary company form a rock-solid foundation and do not drift with the trends and fashions of the day. In some cases, these core
values have
remained in place for over one hundred years. Yet, while keeping their core ideologies tightly fixed, visionary companies display a powerful desire for progress that enables them to change and adapt without compromising their cherished core ideals.

The point? Capable leaders who recognize their core values can change practices and procedures to enable their organizations to move forward while preserving those same core values.

Like Paul, all godly leaders need the ability to hold on to core values while making those changes necessary to advance their cause.