Book Report – Onward by Howard Schultz

FAVORITE QUOTES

“There are moments in our lives when we summon the courage to make choices that go against reason, against common sense and the wise counsel of people we trust. But we lean forward nonetheless because, despite all risks and rational argument, we believe that the path we are choosing is the right and best thing to do. We refuse to be bystanders, even if we do not know exactly where our actions will lead.”

ENTREPRENEURS must love what they do to such a degree that doing it is worth sacrifice and at times, pain. But doing anything else, we think, would be unimaginable.

SUCCESS is not sustainable if it’s defined by how big you become. Large numbers that once captivated me – 40,000 stores – are not what matter. The only number that matters is “one.” One cup. One customer. One partner. One experience at a time. We had to get back to what mattered most.” – Howard Schultz

“I can see the light, I know what we have to do. We have to show up. We have to do the work. And doing the work means we have to find answers to tough problems. We have to be highly focused on the things that matter and stop wasting time and money on things that are irrelevant.

What matters is that we push for answers for the problems in front of us and are curious about the things we do not see, and look for ways to get better, smarter, more efficient and push for reinvention and innovation.”

IN TIMES OF ADVERSITY, we really discover who we are and what we’re made of.

SCHULTZ LESSONS. Grow with discipline. Balance intuition with rigor. Innovate around the core. Don’t embrace the status quo. Find new ways to see. Never expect a silver bullet. Get your hands dirty. Listen with empathy and over communicate with transparency. Tell your story, refusing to let other define you. Use authentic experiences to inspire. Stick to your values. They are your foundation. Hold people accountable but give them the tools to succeed. Make the tough choices. It’s how you execute that counts. Be decisive in times of crises. Be nimble. Find truth in trials and lessons in mistakes. Be responsible for what you see hear and do. Believe.

 

KEY TAKEAWAYS AND LESSONS

Schultz wanted to elevate the quality of coffee in America. He wanted to create the Starbucks Experience. We want to change the game of baseball and make it more fun for people to play and watch. We want to do this by creating the Fans First Experience. Starbucks Experience is what Schultz calls a third place, not home or work but a place where people can come together. The Starbucks experience – personal connection – is a necessity and we are all hungry for experience.

MEMO that changed everything – Commoditization of Starbucks Experience – Let’s get back to the core. Push for innovation and do the things necessary to once again differentiate Starbucks from all others.

EVERY MEMO that Howard Schultz wrote was born from his deep desire to push for reinvention and self renewal. Every memo was always about self-examination in the pursuit of excellence and a willingness to not embrace the status quo. Starbucks is in the business of exceeding expectations. Howards role, duty is to challenge the company and himself to do better, especially when things are great.

STARBUCKS TRANSFORMATION AGENDA. Transformation represented scale of change. Agenda provided actionable framework.

#1 PRIORITY – Instill confidence in our future. Without confidence, people could not perform.

Our relationship with our customers is not based on a transaction. We are not in fast food business. Let the coffee speak for itself. PLAY OFFENSE. Share the full story of Starbucks value proposition. Behind every cup of Starbucks is the world’s highest quality, ethically sources coffee beans, baristas with healthcare coverage and stock in company, famers who are trained fairly, a mission to treat all people with respect and dignity, and passionate coffee experts whose knowledge about coffee cannot be matched by any other company.

ICONS – Beatles example with consultants who met with Starbucks leadership. Icons disrupt themselves before others disrupt them. Enduring icons are willing to sacrifice near-term popularity for longer term relevance. Icons don’t confuse history with heritage, and always protect their values. Icons assert a cultural authority. Icons reinvent themselves but stay true to their core.

ELIMINATED SAME STORE COMPS – “They were a dangerous enemy in the battle to transform the company.”Transform by being true to our coffee core and doing what’s best for our company not focusing on short term profits.

ONE CUP A TIME. We predicted future success on how many stores we opened instead of taking time to determine whether stores would be profitable. We thought in terms of millions of customers and thousands of stores instead of one customer, one partner, and one cup of coffee at a time.

NEVER STOP HEARING THE MUSIC. Beatles Paul McCartney when was beginning of end of Beatles. Playing Shea Stadium with 55,000 fans in 1965. We couldn’t hear the music over the mass of fans and popularity. Starbucks – when did we forget that our business was about the customer and our love and passion for coffee. Was it in the march to 40,000 stores. Always come back to core – and purpose.

RELENTLESS – Relentless focus on the customer, the customer experience and doing everything we can to differentiate Starbucks from everyone else attempting to be in the coffee business. Relentless focus on the fan and being different then everyone else in baseball business.

PROTECT AND PRESERVE YOUR CORE CUSTOMERS – Advice from Jim Sinegal – CEO of Costco. The cost of losing your core customers and trying to get them back during a down economy will be much greater than the cost of investing in them and trying to keep them.

BEST STORE MANAGERS – are coaches, bossed, marketers, entrepreneurs, accountants, community ambassadors and merchants all at once. They are optimistic problem solvers who run their stores creatively yet analytically, calling upon passion and intelligence to drive customer traffic, partner loyalty and profit. The best managers take their jobs personally, treating their store as if it was their own.

TAKE IT PERSONAL – Starbucks partners take it personal when 50 less customers are coming per day vs. last year. When a customer standing in line peels off because they won’t wait anymore. When a customer has a cup of coffee from somewhere else. Grow accountability on team to take it personal when someone does not come to a Bananas game, when fans go to Braves games instead of ours. When we don’t have as many customers as they once had.

BE INNOVATIVE IN OPERATIONS – Setting up lean program to cut out waste, bringing in new technology to serve customers in better ways. Better POS, better accounting and systems. Reduced cost of waste by looking at all food that is not sold. They saved 75 million in labor costs not by cutting jobs but by reshaping how and when work got done.

LEAN – We were spending so much of our time fixing moments, but not actually solving problems. Fixing moments like mopping a floor, only provides short term satisfaction. Take the time to understand the problem.

HOW YOU MAKE YOUR CUSTOMERS FEEL – STORY OF LAPD DETECTIVE. Long talk with wife and why he could not give up Starbucks coffee during the recession, “Let me tell you why I cannot give up Starbuck coffee. Because it’s not about the cup of coffee. I have a tough job. I see things on a daily basis that no one should see or experience. But the one good thing I count on every single day is how the people in the store make me feel. I want to tell you about your employees. They know my kids names. They know where I go on vacation. They write notes on my coffee cup. I could be 7th in line and they start making my drink. You never know what’s going on in people’s lives when you serve them. For all you know it could be someone’s last day on earth. This is my little escape.

BRAND SPARKS – Subtle, surprising and rare marketing events usually linked to cultural or humanitarian issues and devoid of self serving sales pitch. The Free Cup of Coffee for anyone who votes campaign with the ad during SNL created a ton of buzz. The Ad finished What if We Cared All of The Time, The Way We Care Some of The Time.

IDEAS – New IDEA Execution had to be as good as the idea itself. Ideas had to be relevant to our business, scalable, thoroughly tested, integrated across business channels and embraced by all partners. Ideas can not be fueled by instinct alone

QUESTIONS TO ASK WHILE INNOVATING – How can we re-create and improve the store experience. How might we expand on our value proposition, which has always been about emotional and human connection? How should we strengthen our voice to tell our story? How can the brand extend it’s coffee authority beyond the stores

 

SOMETHING I WILL IMPLEMENT

Connection Idea – Jim Donald – Former CEO of Starbucks would stop hour meetings early at 45 minutes and have partners call someone they usually did not contact every day.

INNOVATE at the Core. Former Starbucks Strategy was to build more stores as fast as we could and do more of what worked in the past. BUT we were not pushing ourselves to do things better or differently. We were not innovating in lasting ways. We were venturing into unrelated businesses like entertainment. And we were pushing products that deviated too far from the core coffee experience. As one Starbucks parter expressed, it was if we were running a race but no longer knew what we were running for.

INNOVATE AROUND MAKING BASEBALL MORE FUN FOR MORE PEOPLE. Baseball is to us what coffee is too Starbucks. Baseball has been same way. Starbucks elevated coffee like we will elevate baseball.

KNOWLEDGE CAN BREED PASSION. When Schultz visited Beechers Handmade Cheese, the woman behind the counter became an expert on cheese and only worked there for 6 months. Schultz realized that Starbucks had to do a much better job of sharing our coffee knowledge and communicating our mission. Pride and purpose would help give our partners a sense of ownership. The Bananas need to share more about our story, our experience and our desire to change baseball experience.

HOLD BUSINESS STANDARDS TO SAME STANDARDS WE HOLD THE SHOW.

CREATE INNOVATIVE GROWTH PLATFORMS WORTHY OF OUR COFFEE. Starbucks would grow not just by adding stores and selling coffee, but by extending it’s brand and or expertise to new product platforms and expanding or complementing coffee

IDEASTORM & MY STARBUCKS IDEA – Michael Dells inspiration for Schultz to let their customers share and come up with ideas and create an idea community for Starbucks. Great opportunity for our fans. Build an online community to share ideas.

 

HOW DOES IT FIT WITH THE FANS FIRST WAY

“We needed to rediscover who we were and imagine who we could be.” – Howard Schultz
“As CEO, it was my job to reignite our partners courage and to foster an aggressive desire to once again swing for the fences – as if our lives depended on winning.”

Powerful question Howard Schultz asked to partners. “If this were your store, what would you do differently?” Inspire ownership and empower group to make Fans First decisions and take risks on daily basis if it fits within our Fans First Way.

“For me, it had also been great fun to stop for a few moments to taste and ponder what could be.”

“For more than 20 years, I’ve said that every company must push self renewal and reinvention, constantly challenging the status quo. For Starbucks, doing so means we are once again thinking big and dreaming big, embarking on a road we have not taken before – Howard Schultz

The Fans First Way of Caring, Different, Enthusiastic, Fun, Growing and Hungry is all captured in this book. We must care one fan at a time, think dramatically different, bring passion and enthusiasm to every fan and idea, have and give fun and never stop growing and being hungry to do more, try more and make a bigger difference in peoples lives.