Photo: Starbucks
Starbucks chairman and chief executive officer Howard Schultz announced this week that he is taking a step back from the day-to-day running of the coffee giant to focus on the development of its Roastery and Reserve concepts along with its investment in Princi, the Italian bakery chain.
Business didn’t go so well the last time Mr. Schultz relinquished responsibility for the day-to-day operations of the company. Former grocery executive Jim Donald was named president and CEO of Starbucks in 2005, but by 2008 he was gone and Mr. Schultz was back. While acknowledging that a faltering economy was behind some of the chain’s woes at the time, Mr. Schultz also admitted that much of what was wrong at Starbucks was of the company’s “own making.”
So will Mr. Schultz’s plan to focus on Starbucks’ “long-term strategy and innovation” help the company achieve new heights or will he find himself in a situation similar to 2008?
Many experts believe Starbucks' executive “bench” is strong and the changes announced by Mr. Schultz will prove positive for the company. In a letter to stakeholders, Mr. Schultz identified numerous executives whom he would work with directly to avoid any hiccups going forward.
Mr. Schultz made particular note of a change in responsibility for Cliff Burrows, who will go from leading Starbucks' business in the U.S. to the top spot of Siren Retail, a new division within the company responsible for the global expansion of the Roastery and Reserve stores. Mr. Burrows will also be responsible for growing Princi, including an expansion of standalone stores.
Kevin Johnson, Starbucks' president and chief operating officer, will be entrusted with building Starbucks' core business. Mr. Schultz credited Mr. Johnson for his role in transforming Starbucks' business and for his embrace of “technology that strengthens our customer connection and unlocks agility across the company.”
- Message from Howard Schultz: The Best Version of Ourselves – Building Trust, Leading with Courage – Starbucks
- Starbucks’ Schultz to step back, focus on high-end strategy – The Seattle Times (tiered sub.)
- Starbucks CEO to focus on premium coffee – USA Today
- Starbucks leadership changes herald new era for coffeehouse chain – Nation’s Restaurant News
- Howard the Merchant Helps Revive Starbucks – RetailWire
- Donald Out, Schultz Back in at Starbucks – RetailWire