The culture is what you reward

In late 2007, 星巴克 U.S. store sales began to soften after a long run of consistent growth. Howard Schultz had stepped down from CEO in 2005, but in early January 2008, announced he was back and issued the first of several "Transformation Agenda Communications"—detailed memos sent via email to all Starbucks employees and stores.

The Transformation Agenda laid out a series of steps the company would take to arrest the sales decline and refocus itself on the customer, and what made Starbucks unique.

I was working in the group that operationalized products and programs for U.S. stores, and many of us got assigned secret, code-named projects that would be announced at Starbucks annual shareholders' meeting that March. With only two months to plan and organize new program releases, we were all feeling under the gun but re-energized by the new leadership.

Since the debut of its Starbucks Card in 2001, the company had wanted to do a loyalty program but the technical challenges of tying together store POS data with back-end systems were fierce. Grocery chains and retailers weren't even doing it yet; other coffee retailers were using paper punch-cards.

I was on the team that launched the first iteration that spring of 2008, and it goes down as my favorite project. That's because of the team I got to work with and the person who led it, a young marketer new to Starbucks who brought a kind of leadership I'd never seen before. It was his ability to lace together direction from the highest level of the org to every layer beneath. He made people feel heard and respected, connected.

This vibe was contagious and extended across the creative studio to IT, to my group in Operations. But there were problems with the program and the tech wasn't ready. The baristas had to pick up the slack by pushing a button on the touchscreen as a workaround, because the POS and back-end systems weren't connected yet. That may not sound like a big deal, but it was.

The problem fell to my group, to get baristas to push the button. But getting everyone to do anything consistently across thousands of stores is nearly impossible. So we went back to our toolkit of corporate communication options, which is to ask, tell, remind, threaten, shout, and finally, to shame. We actually produced spreadsheets showing the level of button-pushing compliance by region and sent that to the regional vice presidents every Monday, hoping that would trigger a response. Some took the bait, most didn't.

Because our project had such high visibility, we had license to think outside of the box. A peer from a different group proposed an idea, to create a cartoon-style visual (we called them job aids at the time) and have the stores attach that to the POS as a reminder. He mocked it up and I gave it to someone in the creative studio; our marketing lead approved the expense, we printed thousands and mailed them to the stores. Everyone loved it.

I remember hearing an HR executive from a big tech company describe how organizational culture is defined. He said it's not what the company says about its culture, it's defined by how it rewards its people. And I remember the time I gave thanks to that peer of mine in one of our Friday morning coffee tastings, where dozens of us met for half an hour to slurp a cup of coffee, celebrate milestones, and chat.

The culture was made strong in those times we offered genuine praise and admiration for one another. It felt good and lifted everyone up. In the way Starbucks has tried to preserve its human connection in the stores, that same connection is what I treasured most about that project.

In his LinkedIn post about Starbucks recent sales performance, Howard wrote "the answer does not lie in the data, it's in the stores." And while that may sound opaque, it's true.

With its mobile ordering and payment platform, Starbucks has come so far from where it was in those early days of the loyalty program when I first worked on it. It pioneered both loyalty programs and express order and pay, and gave its customers exactly what they wanted. But it may have given away more than it intended, and lost some of its culture as a result.

If the culture is what we reward and we reward convenience over connection, the culture will change. That may matter more to the company than its customers, until the day its customers can no longer tell what's unique about Starbucks and how it's different from all the rest.