Howard Schultz: "What's Next?"

While he no longer has active engagement with Starbucks, the recent earnings miss by Starbucks prompted Howard Schultz, former chairman, to address what management needs to do in a situation where direction seems to be lost.

I liked his comments because they were not directed at Starbucks current leadership per se. He posed questions related to any who are in a leadership position for consideration. To note:

I, too, experienced some quarters of financial disappointment in my four-plus decades leading Starbucks.

Ask any public-company CEO and they will tell you that “a miss” is virtually inevitable, even at the best-managed, fastest-growing firms.

It's not the miss that matters. It’s what comes next.

What’s the diagnosis of the problem? What’s the impact on morale? And what’s the strategy to fit it?

At any company that misses badly, there must be contrition and renewed focus and discipline on the core. Own the shortcoming without the slightest semblance of an excuse.

There is a natural tendency to try to do too much too soon. Don’t try to do everything at once. Leaders must model both humility and confidence as they work to restore trust and increase performance across the organization.

As decisions are made to take new action to redirect or course correct, then executives need to answer four questions, according to Peter Drucker in his classic book "The Effective Executive":

1. Who has to know of this decision(s)?
2. What action(s) needs to be taken?
3. Who is to take it?
4. What does the action have to be so that the people who have to do it can do it?

He notes the first and fourth can often be overlooked and, as a result, extend or compound a problem.

Schultz's full commentary is linked here

Related:

Where Starbucks Went Wrong (Harvard Business Review)

Update 7/30/24: 2Q Sales Numbers Also Missed

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Other posts on leadership:

Trust and the Leadership Gap

Management vs. Leadership

Ego vs. Healthy Debate. Keep the Focus Productive

About me

I have been a career sales professional in B2B sales. This has included managing my own territories, selling jointly with others and managing sales teams.

My career started in Seattle with the Puget Sound Business Journal, but a significant portion of my professional time was in California, split between Los Angeles and Orange County, before a return to Seattle.

Also

I am owner and community manager for the LinkedIn group?Seattle Sales, Marketing and Advertising Professionals, which has 4900+ members: (4) Seattle Sales, Marketing & Advertising Professionals | Groups | LinkedIn

Also one of the first million members of LinkedIn (2004). I have been an active blogger on the platform since 2014, when the option was first offered.