Starbucks: A Significant & Purposeful Business Anchored in Engaging & Compassionate Leadership Practices

It is important to remember that Starbucks started as a single store and that anything is possible if we take the lessons learned from Starbucks as a nudge to think about how we can innovate and expand our products, services, social media tools, technologies, and channels. The leaders at Starbucks also demonstrate what is possible when you foster product passion, teach your people the importance of human connections, seek operational excellence and efficiency, and engage in a never-ending pursuit of relevance.     – Joseph Michelli, Leading the Starbucks Way

The first session of the Fall Term of the 2013 GsD is wrapping up with today’s post. Organizational consultant Joseph Michelli’s latest book Leading the Starbucks Way has been the primary resource for this session.

Michelli uses over two years of research with dozens of leaders in the Starbucks organization to develop five actionable principles that forge emotional connections that drive innovation, grow new business product lines, and foster employee and customer loyalty. These principles are “brief and clear, and put the customers, products, and experiences at the purposeful center of Starbucks.” Here are the five principles:

  1. Savor and elevate
  2. Love to be loved
  3. Reach for common ground
  4. Mobilize the connection
  5. Cherish and challenge your legacy

In order to help you evaluate mastery of the material as well as apply independent thinking skills to your own setting, here are a few summary thoughts based on the five principles above.

  • When frontline team members are passionate about your Guest Experience, they build interest and excitement on the part of your Guests.
  • Evaluate every strategy to ensure that it aligns with your core values, reinforces your purpose, and stimulates continued progress toward your aspirations.
  • Well-designed experiences involve a willingness to see the environment and process from your Guests’ perspective.
  • If your Guests view your organization as being competent and having integrity, you have created the environment for trust. Trust is a gateway emotion on a journey to greater levels of emotional engagement.
  • Listening is not a passive pursuit; listening is synonymous with connecting discovering, understanding, empathizing, and responding.
  • Good leaders provide uplifting moments for those who uplift Guests.
  •  One of the most powerful opportunities for building a relationship occurs after your Guests’ visit, with your team members offering a warm farewell, and inviting Guests into future opportunities to connect.
  • Observe your Guests, then adopt, adapt, and extrapolate new ideas that will connect both locally and globally.
  • Technology should support the mission, not the reverse.
  • Complacency and inertia are challenges to innovation for your organization.
  • There is typically a strong interdependence among a organization’s performance, its values, and the impact it has on the communities it serves.
  • Passionate team members have a magnetically positive impact when it comes to turning Guests into attenders and future team members.

It is important to remember that, at its heart, Starbucks is in the people business serving coffee. Place, Process, and Product are all important, but the foundation and core of Starbucks success is its People.

Take a look at this brief video and you will have a better understanding of what I mean:

SBPartner1

The M.U.G. Award referred to in the video allows partners to recognize co-workers for “Moves of Uncommon Greatness” that help them achieve their goals. It’s a way of saying, “Thanks for helping me out. I couldn’t have done it without you!”

Can your team members say the same thing?

Part 9 of a series in the 2013 GsD Fall Term

Leading the Starbucks Way: Information, Insights, and Analysis Needed to Create a High-Performance Guest-Oriented Organization

inspired by and adapted from Leading The Starbucks Way, by Joseph Michelli

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Leaders Honor the Past – But Aren’t Trapped There

In late 2007, Starbucks was not doing well, and the future looked bleak. To address the emerging problems, former CEO Howard Schultz, who had stepped aside almost eight years earlier to become chairman of the board, did something unexpected: he returned as CEO to oversee day-to-day operations.

Schultz came back to Starbucks with a passion and a plan, and over the next two years, Starbucks returned to sustainable, profitable growth.

Here’s what Schultz had to say in looking back to early 2008: 

If not checked, success has a way of covering up small failures, and when many of us at Starbucks became swept up in the company’s success, it had unintended effects. We ignored, or maybe we just failed to notice, shortcomings.

We were so intent upon building more stores fast to meet each quarter’s projected sales growth that, too often, we picked bad locations or didn’t adequately train newly hired baristas. Sometimes we transferred a good store manager to oversee a new store, but filled the old post by promoting a barista before he or she was properly trained. 

courtesy nbcnews.com

courtesy nbcnews.com

As the years passed, enthusiasm morphed into a sense of entitlement, at least from my perspective. Confidence became arrogance and, at some point, confusion as some of our people stepped back and began to scratch their heads, wondering what Starbucks stood for. 

In the early years at Starbucks, I liked to say that a partner’s job at Starbucks was to “deliver on the unexpected” for customers. Now, many partners’ energies seemed to be focused on trying to deliver the expected – mostly for Wall Street. 

Great organizations foster a productive tension between continuity and change. On the one hand, they adhere to the principles that produce success in the first place, yet on the other hand, they continually evolve, modifying their approach with creative improvements and intelligent adaptation.

When organizations fail to distinguish between current practices and the enduring principles of their success, and mistakenly fossilize around their practices, they’ve set themselves up for decline.

By confusing what and why, Starbucks found itself at a dangerous crossroads. Which direction would they go?

In Leading the Starbucks Way, organizational consultant Joseph Michelli uses two years of research with dozens of leaders in the Starbucks organization to develop five actionable principles that forge emotional connections that drive innovation, grow new business product lines, and foster employee and customer loyalty. These principles are “brief and clear, and put the customers, products, and experiences at the purposeful center of Starbucks.”

Leadership Principle #5: Cherish and Challenge Your Legacy

“Cherish and challenge your legacy” is all about encouraging you to define the legacy you wish to leave and evaluate your leadership performance, in part, based on your progress toward that legacy.     – Joseph Michelli, Leading the Starbucks Way

A key element in the success of the Starbucks transformation results from an alignment between leaders who are charged with driving change and those who are responsible for ensuring consistent operations.

Our challenge has been to produce innovations that improve operations, drive growth, enhance the partner and customer experience, and increase profitability. That’s a tall order, but it often occurs in the most subtle ways.     – Craig Russell, Starbucks senior vice president, Global Coffee

Ultimate success in driving innovation hinges on the alignment of those who foster change and those who maintain stability.

ChurchWorld Application

  1. What are the strengths of your organization that have been most instrumental to the success you have achieved?
  2. How might those success drivers inadvertently become traps that could constrain future growth?
  3. How aligned are the “operators” and the “innovators” in your organization? Would you say that both groups share an “operational innovation” mindset?

Any organization, small or large, consumer or otherwise, that is going to embrace the status quo as an operating principle is just going to be dead…The need for constant innovation and pushing forward has never been greater than it is today.    – Howard Schultz, CEO, Starbucks

Leaders must honor the past but not be trapped in it.

 

Part 8 of a series in the 2013 GsD Fall Term

Leading the Starbucks Way: Information, Insights, and Analysis Needed to Create a High-Performance Guest-Oriented Organization

inspired by and adapted from Leading The Starbucks Way, by Joseph Michelli

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Applying the Power of AND: Understanding the Universal Needs of the People You Serve AND Innovating to Meet the Unique Needs of Your Local Environment

There is an ongoing debate among cultural anthropologists between the two conflicting perspectives of universalism and cultural relativism. Universalism suggests that the underlying similarities among all people are greater than their cultural differences, while cultural relativism asserts that cultural differences have a profound effect on people, making it difficult for “outsiders” to fully understand the relevant context of behavior.

As a church leader, you may not consider yourself a cultural anthropologist, but go back and read that last phrase and you will probably change your mind.

To put it a different way, how easy is it for “outsiders” to become connected to your organization?

In Leading the Starbucks Way, organizational consultant Joseph Michelli uses two years of research with dozens of leaders in the Starbucks organization to develop five actionable principles that forge emotional connections that drive innovation, grow new business product lines, and foster employee and customer loyalty. These principles are “brief and clear, and put the customers, products, and experiences at the purposeful center of Starbucks.”

Leadership Principle #3: Reach for Common Ground

Starbucks leaders have made their share of mistakes in attempting to strike a balance between the universal and the cultural. In the process of their setbacks and victories, Starbucks serves as a helpful guide on how to make powerful and respectful connections in new opportunities.     – Joseph Michelli, Leading the Starbucks Way

The goal of leadership is to create the right environment for human connections to occur and to help staff members manage the inevitable issues that surface.

ChurchWorld Application

  1. Are you paying attention to your Guests’ needs to be seen and heard?
  2. Would you go so far as to say your Guests feel understood and known?
  3. Do your team members say thank you, offer a fond farewell, and invite guests into future opportunities to connect?
  4. When it comes to seeing, hearing, and knowing your Guests, what are the strengths and opportunities for your organization?
  5. Are you connecting with each Guest verbally and nonverbally upon first contact?
  6. Do you go from listening to Guests to Guest knowledge on which you can act?

Your community has all kinds of specific challenges. Do you know what they are?

Understanding your local predicament is about having an intimate grasp of the soil where God has called you to minister. It’s about walking firsthand your contours of locality.

Starbucks leadership has deployed a series of key approaches and adjustments to maximize the local relevance of products, services, and physical environment. They include decentralization and revitalization of their corporate structure, developing relationships with local allies, and understanding the physical properties of history of the community they serve.

 Considering local cultural influences is an important layer of our design process to ensure market relevance. For us, it starts with listening and observing the needs of our partners and customers. It’s about communicating up front, talking to customers, listening to partners, and it’s seeing through the lens of that collective experience.     – Thom Breslin, Director, Design, Starbucks UK

ChurchWorld Application

  1. Are you seeking to provide the same thing to everyone, or do you understand the needs of unique needs of different people?
  2. How far can and do you go to achieve local relevance?
  3. Have you completed a “sense of place” in your new markets such that you can blend your brand with local needs?

Leaders understand that maximized choice is essential to today’s consumer, but with choice comes a responsibility to ensure that you can execute the new product offerings at a level commensurate with your existing levels of excellence.

 If you don’t innovate, renovate, and constantly seek relevance – you die.     – Thom Breslin

ChurchWorld Application

  1. What are the product rituals and daily use patterns of prospective customers in new markets?
  2. How are you positioning your product (define or give examples) to capture customers in the context of their lifestyles?
  3. What are you doing to stay alive and thrive in new opportunities?

Starbucks leaders actively seek local relevance and adjust their product and service offerings accordingly. When leaders find the right business partners and make conscious and concerted efforts to give customers what they love, their business achieve lasting connections and maximal success.

What are the unique needs and opportunities where God has placed your church?

Part 6 of a series in the 2013 GsD Fall Term

Leading the Starbucks Way: Information, Insights, and Analysis Needed to Create a High-Performance Guest-Oriented Organization

inspired by and adapted from Leading The Starbucks Way, by Joseph Michelli

Listening is an Active Verb

At Starbucks, listening is synonymous with connecting, discovering, understanding, empathizing, and responding.     – Joseph Michelli, Leading the Starbucks Way

The benefits of this type of listening fuel the entrepreneurial and adaptive spirit of a brand that could have easily lost its nimbleness as a result of its growth and scale.

courtesy 360degreefeedback

courtesy 360degreefeedback

According to organizational consultant Joseph Michelli, many leaders are either too busy to listen or are more interested in speaking. As a result, listening intently, regularly, and respectfully to team members separates the great leader from the good one.

In the Starbucks organization, listening takes many forms. While leaders listen informally at an individual or team level, Starbucks also has a formalized department that consistently listens for the needs and engagement level of partners.

Virgil Jones, director, Partner Services at Starbucks, notes:

Our team conducts surveys, focus groups, and continuously takes a pulse on our partner population. Within that department, the most important thing I do on a daily basis is listen to our partners. The second most important thing I do is continue to touch base with our partners and adjust, because with the way technology is advancing, the things that are hot, interesting, and engaging with our partners today is going to be completely different 18 months from now.

Michelle Gass, president, Starbucks Europe, Middle East, and Africa, like many other Starbucks senior leaders, demonstrates a different kind of regular and personal listening that fuels partner engagement. Her approach comes in the form of “listening tours.” According to Michelle:

I travel across my region regularly and conduct listen tours and roundtable meetings. These are informal meetings where we spend about 90 minutes paying attention to the thoughts, needs, and ideas of those we serve. While listening is important, taking swift action to elevate experiences is essential. These tours are an ongoing process of connection and discovery, not an event.

Michelli adds:

In many ways, when leaders demonstrate formal and informal listening, they not only engage employees but also gain access to information that helps them stay relevant to the needs and observations of their team members.

ChurchWorld Application

  1. Do you practice regular, scheduled “listening tours” with your front-line team members?
  2. What are your systematic approaches to other types of leadership listening?
  3. How do you complete the listening cycle (what actions do you take to inform your team members that they have been “heard”?)

Are you really listening to your teams? What are you hearing? Most importantly, what are you doing?

Part 5 of a series in the 2013 GsD Fall Term

Leading the Starbucks Way: Information, Insights, and Analysis Needed to Create a High-Performance Guest-Oriented Organization

inspired by and adapted from Leading The Starbucks Way, by Joseph Michelli

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When Good is not Good Enough, It’s Time to Lead Your Team to “Savor and Elevate”

“Savor and Elevate” is a business principle that emphasizes the importance of maximizing enthusiasm for the products, services, and experiences your company provides.      Joseph Michelli, Leading the Starbucks Way

To achieve Starbuck’s mission “to inspire and nurture the human spirit – one person, one cup and one neighborhood at a time,” leaders at Starbucks crafted a set of principles to be lived daily, the first of which involves passion for:

 Our coffee. It has always been, and will always be, about quality. We’re passionate about ethically sourcing the finest coffee beans, roasting them with great care, and improving the lives of people who grow them. We care deeply about this; our work is never done.

 Starbucks leaders have produced diverse tools to help Starbucks partners develop or deepen a genuine product passion.

One of those tools is a coffee education that reflects a 70/20/10 growth and development approach. Based on research on how people integrate and utilize new information, new baristas at Starbucks receiver approximately:

  • 70 percent of their initial coffee education through on-the-job experience and hands-on practice
  • 20 percent of their training through the feedback and mentorship from their peers, learning coach, and store management
  • 10 percent of their training from an online modularized curriculum
courtesy coffeeconcepts.com

courtesy coffeeconcepts.com

At intervals during the certification training and development process, new partners must pass a knowledge test and demonstrate to their store manager skill competency in tasks such as preparing a cappuccino.

A person can become passionate not only about the coffee itself, but also about the artistry involved in its creation.

If a barista only goes through the motions of pouring espresso, if he or she does not care, then Starbucks has lost the essence of what we set out to do 40 years ago: inspire the human spirit.    – Howard Schultz, Starbucks CEO

ChurchWorld Application:

  1. What is your Guest Experience Team’s overall level of passion in serving your Guests and attenders? How does it compare to the passion levels at the best service providers you have encountered in the marketplace?
  2. Have you built-in Guest Experience knowledge and passion from the beginning of your team member’s involvement?
  3. What first impressions do you create for new team members? Do they experience what you hope they provide?

While the opportunity for developing a passion for coffee and the artistry of its preparations is built into the formative learning experiences of Starbucks new hires, the company’s leadership understands that this passion is reinforced, sustained, and deepened through corporate celebration and communication rituals, immersive learning opportunities, and core business strategy. Michelli elaborates:

Authentic corporate rituals are powerful ways to create a common bond, inspire commitment and innovation, and build an integrated and effective culture.

Rather than providing messages that solely describe the “what” and “how” of your products, listen for and share stories that will help connect your people to the nuances of your products and/or special aspects of the customer journey.

Leaders at Starbucks have crafted way to immerse staff members in enriched learning experiences that create opportunities for product passion. They have also found ways to spark master of product knowledge by relying on an intrinsic sense of accomplishment that comes from advanced learning and the ability to teach others.

Evaluate every strategy to ensure that it aligns with your core values, reinforces your purpose, and stimulates continue progress toward your aspirations.

Increased visit frequency, wider product penetration, greater customer engagement, consistent product sell-through, and employee pride and professional development are enviable by-products of igniting the passion of your team members.

Growing research evidence indicates that “knowledgeable employees” is one of the top items on the wish list for customers today.

Imagine what knowledgeable and passionate employees can do, not only for your customers, but also for the morale and enthusiasm associated with your organization.

ChurchWorld Application:

  1. Examine the habits, rituals, and messages that you employ in your Guest Experience ministry. Are they facilitating emotional connections, a sense of community, and passion for excellence?
  2. How to you capture and share stories of your Guest Experiences team members that help connect them to Guests, one another, and the vision of your church?
  3. How are you incorporating Guest Experience mastery and social recognition into your team training programs?

Part 2 of a series in the 2013 GsD Fall Term

Leading the Starbucks Way: Information, Insights, and Analysis Needed to Create a High-Performance Guest-Oriented Organization

inspired by and adapted from Leading The Starbucks Way, by Joseph Michelli

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GsD Fall Semester Starts Monday, September 16

…and you don’t even need an ID card!

MU-IDcards monsteruniversitywallpaper.com

courtesy monsteruniversitywallpaper.com

Guestology – the art and science of knowing and understanding your guests – is a term originated by Bruce Laval of the Walt Disney Company.

The use of Doctor of Guestology, or GsD, is a tongue-in-cheek acknowledgment that organizations that really want to understand and deliver a WOW Guest Experience need to study the best practices and principles in use today, and then adapt them to the context of their own environment.

Foundational classes were offered this past Spring and Summer terms. Need to do some “catch-up” learning over the weekend? Check out the course material already covered this year here.

It’s time to dive into some advanced studies:

  • Leading the Starbucks Way: Information, Insights, and Analysis Needed to Create a High-Performance Guest-Oriented Organization
  • Practicum: Exploring the Five Tactical Areas of Customer Amazement at Ace Hardware
  • Guest Experience Design 101: Unpacking the Mind-set, Techniques, and Vocabulary of Design Thinking for the Guest Experience
  • Exploring New Dimensions of Guest Experiences: Beyond 3D

Class begins Monday September 16 at 8 AM…

…don’t be late!