Onward tells the story that begins with the private memo that Howard Schultz sent to then-CEO Jim Donald in February 2007 entitled “The Commoditization of the Starbucks Experience“. That memo was leaked to the public. Subtitled “How Starbucks Fought for Its Life without Losing Its Soul,” the book provides a first-hand account of how Starbucks, a darling growth stock of Wall Street, weathered the recent economic downturn and challenges from its competitors. Schultz would return to the CEO post in January 2008 and initiate a series of dramatic changes. The most daring was the closing of all 7,100 US locations— for three hours— to retrain all its partners in the art of the perfect shot of espresso.
We’re taking time to perfect our espresso.
Great espresso requires practice.
That’s why we’re dedicating ourselves to honing our craft.
Where his previous book, Pour Your Heart Into It, described how Starbucks maintained its values and unique corporate culture during rapid growth, Onward describes how Starbucks maintained its values during a dark downward financial spiral. At the onset of the 2008 recession, the daily trip to Starbucks was one of the first things consumers began to cut from their household budgets. Simultaneously, competitors such as McDonalds were upgrading their coffee offerings while undercutting Starbucks on price. What is also different from the previous book is how technologies such as the world wide web, Wi-Fi, smartphones, and social media have changed how Starbucks interacts with its customers and partners.
As a long-time BusinessObjects professional, I found myself thinking about how BusinessObjects was assimilated by SAP during the same timeframe as this book. Starbucks had a distinct set of values that were furiously maintained despite some drastic changes in its operations. In contrast, SAP seemed to go out of its way to prove to the world that BusinessObjects did not have a unique set of corporate values worth preserving. Instead, SAP seemed quite focused on destroying anything BusinessObjects employees, or even customers, found of value.
As judged by its stock price, Starbucks has turned the corner. It sharpened its focus and improved its back-end operations while staying true to its mission – “to inspire and nurture the human spirit – one person, one cup, and one neighborhood at a time”.
From page 13:
If home is the primary or “first” place where a person connects with others, and if work is a person’s “second place,” then a public space such as a coffeehouse— such as Starbucks— is what I have always referred to as the “third place.” A social yet personal environment between one’s house and job, where people can connect with others and reconnect with themselves. From the beginning, Starbucks set out to provide just such an invaluable opportunity.
So when some refer to Starbucks’ coffee as an affordable luxury, I think to myself, Maybe so. But more accurate, I like to think, is that the Starbucks Experience— personal connection— is an affordable necessity. We are all hungry for community.
I’m guilty as charged. Most of my work-day mornings begin at Starbucks. For me, the quality of the coffee, Wi-Fi access, and community make it the perfect place to begin the day.
Howard Schultz is fond of saying that Starbucks isn’t in the coffee business serving people, but in the people business serving coffee. Anyone in the “people business” will profit from reading this engaging story.
UPDATE 09/29/2012: Mike Urbonas has another take on Onward- a really smart article on Smart Data Collective about how Howard Schultz used business intelligence to “get his hands dirty” and find out what was really going on at Starbucks.
Disclosure of Material Connection: I purchased this book and did not receive it free from its publisher. Some of the links in the post above are “affiliate links.” This means if you click on the link and purchase the item, I will receive an affiliate commission. Regardless, I only recommend products or services I use personally and believe will add value to my readers.I am disclosing this in accordance with the Federal Trade Commission’s 16 CFR, Part 255: “Guides Concerning the Use of Endorsements and Testimonials in Advertising.”