I’m an alum of Starbucks, having worked at the SSC (Starbucks Support Center) from the time Orin Smith was at the helm, through Jim Donald’s tenure, and then getting laid off with 300 of my colleagues a few months after Howard returned. Starbuck’s history overlaps with key parts of mine. I still care quite deeply about the company. I make it a point to read pieces like this one that come through my filter: Howard Schultz Has Something Left to Prove.
I remember the hand-off to Jim Donald, and the eventual fallout. I remember wondering if the only way Howard was going to leave Starbucks was in a pine box. The transition mentioned looks like a great opportunity for both Howard and Starbucks.
The article does a good job of looking at the situation, at least from what I can see. Now, I’ve been away from Starbucks for nearly 10 years now, so my understanding of the corporate dynamics are weak. But it meshes with my memory of days gone by.
Besides the internal challenges of succeeding someone who deeply shaped the culture of a major company, though, I’m more interested in their brief look at the state of the coffee sector.
It delights me to see audacious goals. That’s a part of the company I’ve admire and love. I agree with Johnson’s view that Starbucks has two overarching challenges: continually embracing digital culture, and then expanding the coffee expertise elements of the Brand. And I expect the Roastery and Reserve brands will do good work tackling those issues.
The competition will be fierce, though they’ll be quite adept at giving the other players a run for their money. However, it’s important to keep an eye as companies merge, align and garner new assets to apply. I’m thinking of the JAB Holdings acquisition of Peet’s, Stumptown and Intelligentsia as referenced by the article. Well, JAB actually has become a significant player in the Specialty Coffee arena. Besides Peet’s, Stumptown and Intelligentsia, they also control Keurig: Green Mountain, Caribou Coffee, and Mighty Leaf tea. And they control Einstein Noah Restaurant Group (the bagel chain) and Krispy Kreme. I would never have anticipated these companies going private, and becoming united under one investment group. A fascinating development that will help shape the specialty coffee world for years to come.
I don’t envy Kevin Johnson as he steps up to follow Schultz. It’s daunting to consider. However, he’s just the leader. I know many, many of the people bringing the day-to-day Starbucks experience to life. They’re committed, passionate and talented. I have no fears for the future of the Siren.