I’m currently reading Howard Schultz’s Onward: How Starbucks Fought for its Life Without Losing its Soul (2010). Schultz compellingly conveys his dedication and passion for the company and, of course, great coffee. Returning in January 2008 as Starbucks’ ceo (Starbucks uses lower case for all company titles), Schultz would save the company from its doldrums and rekindle long-lasting success, soundly refuting critics who had proclaimed Starbucks’ best days were behind it.
Just as important as what Howard Schultz did as ceo was what he stopped doing: Soon after returning to the ceo office, Schultz told investment analysts that Starbucks would no longer publicly report its same-store sales, or “comps.” Schultz’s wise decision would prove to be as critical to Starbucks’ revitalization as its new Pike Place coffee blend and Clover brewing machines. As Starbucks’ chairman, Schultz had realized the company had, slowly over time, “defaulted” to viewing the health of the company through the singular performance lens of comps; as long as comps were fine, the company was fine – except that it wasn’t.
In hindsight, it was very fortunate that Howard Schultz had remained active as Starbucks’ chairman and was willing and able to step back into day-to-day operations as ceo. Having pioneered the company’s signature cafe stores, Schultz had the situational awareness to realize that “something wasn’t right” with the company’s customer experience years before comps finally tanked.
What about other leaders who also want true, long term success, but don’t have the same hands-on, ground-floor business awareness of a company founder? How do they acquire similar awareness to avoid overlooking slow, subtle damage to the company and instead make business decisions that promote genuine, long-lasting success? Here are a few essential requirements, based on some insights I drew from Schultz’s book.