The Starbucks management style is essentially the leadership style of Howard Schultz. What he believed, how he wanted to run the company, the kind of values he wanted the employees to share and the manner in which he wanted to manage the business have eventually taken the form of Starbucks management style. At its roots, the whole management system and modus operandi of Starbucks is how Howard Schultz steered the business.
Starbucks Management Style Explained
Nothing Is More Important Than Employees & Customers.
Everyone is important. That is one of the first things you would be told or you would learn when you are working at Starbucks. The company or the brand is obviously important. Every business would want that. But the people working for the company and the customers are more important in Starbucks. That is the legacy of Howard Schultz.
As a leader, Howard Schultz is famous for his focus on people. He values the welfare of the people working in Starbucks and the customers walking into the stores. He values the two more than the brand, the financial rewards and the perception among Wall Street honchos. Starbucks has not had a dream run forever. There were scary times. Schultz has not been at the helm forever. There was a time when Starbucks was headed nowhere and it could have been a thing of the past had it not been for his leadership.
Starbucks has a healthcare benefit for all its employees and it issues stock options. When Starbucks initiated this practice, it was almost unheard of and even today it is a unique proposition. Many companies offer similar benefits today but not in the exact manner. The two benefits were offered by Howard Schultz to make employees feel cared for, that they were important and that they were all contributing to something good by working for the company. Schultz once said that everyone in the company must feel connected and should make sense of what is being done. The accountant, the baristas, the marketing teams and everyone associated with Starbucks, regardless of their understanding of coffee, must understand what the company is trying to do. And that is offering something of value to the customers.
It Is Not About Money
Many successful business leaders in history and today have believed that money or financial success should be a byproduct. The primary objective should be to offer something valuable to customers and to take care of those who are making it possible to offer that something. So when there was a time Starbucks was bleeding and everyone advised Howard Schultz to take away the healthcare benefit, he disagreed and stuck to his philosophy.
Starbucks rode out the troubled times and no benefits were ever taken away from the employees. Schultz has later said in public that all decisions should not be dictated or even influenced by financial compulsions. Some decisions should be taken from a principled standpoint. The welfare of the employees, according to him, was more important than the financial health of the company. Starbucks still has one of the best wages for entry level workers and also among the highest minimum wages in the world.
It Is About Value
Many people remember the day when Starbucks stores across the United States were closed. It was after Schultz retook the reins of the company. He had been criticizing the quality of coffee at Starbucks and wanted the staffs to get retrained. He wanted the quality of Starbucks products to be better and that cost the company more than $6 million in sales and the investment to train more than 135,000 employees in less than a day. Many would call it a gamble but for Schultz, it was necessary. He treasures value more than anything else. The gamble paid off as Starbucks became a much more valued brand thereafter. It was also a short while before the brand started making headway in several international markets.
Decoding The Starbucks Management Style
The Starbucks management style is participative and transformational. While a company is always driven by the vision of one person or a group of people, it is necessary to hear opinions of others and to have great ideas regardless of where they come from. Starbucks management style is participative in that sense. Everyone from the management to the newest entrant in the workforce has the right to contribute in any which way one can so the company and its products can get better and in effect the customers can get something better.
The Starbucks management style is also transformational, courtesy Howard Schultz. That is primarily because he likes to handle things with the sole intention of changing or transforming it into something better. The quest for improvement is a never ending endeavor for Starbucks.