HowsThatJob? : Starbucks rates in bottom 5

Aside

Before people start pegging me as someone who only sees the positive in Starbucks as of late, it is worth mentioning that a new site, Hows That Job?, has Starbucks listed in the Bottom 5 companies. Now, the site only has 45 reviews right now (in total – with only one for Starbucks) – but it is an opposite point of view. This reviewer also qualifies the rating, saying that it was the customers that made it terrible.

Starbucks Green Apron Book

Photo by rbieber

Did you know that you could just walk into your local Starbucks and request a "Green Apron Book", that outlines the principles of Starbucks? I heard about this little booklet from a recent book I had read about the company and went in to my local Starbucks and asked for a copy. I was a tad surprised when the employees were extremely happy to give one to me. There’s something to be said about a company that is not afraid to share their core principles with their customers. There’s much more to say when they do it so enthusiastically.

I was totally impressed with being able to walk into my local Starbucks and get a copy of their “Green Apron book” after reading The Starbucks Experience: 5 Principles for Turning Ordinary Into Extraordinary.

I did find another review of the book and it was really cool to me that the reviewer offered the same observation that I did around the structure of the Starbucks principles:

After reading it that afternoon, what impressed me the most was the absence of rules. In their place were suggestions, goals, and the empowerment to make every customer’s experience a memorable one. It was at that moment that I realized the significance of Starbucks’ philosophy—not only for business, but for life in general.

This really parallels my thoughts on what I had read:

One thing that comes out fairly strong in most of the books I read about Starbucks (and Toyota as of late) is the acknowledgment of senior managements importance in setting the culture, ideals, and principles of the overall business while giving the “people doing the work” the ability to act within the framework of the principles.

Another cool thing I noticed. When you dig down into the detail of the Be Welcoming principle, you find the following:

Get to know your customer by drink or name.

This completely impressed me – because I experienced it. As a matter of fact, it impressed me so much that I wrote about the experience in the post “ Reaching “Norm” Status – The Ultimate in Customer Service” back in March of 2005.

Books: The Starbucks Experience : 5 Principles for Turning Ordinary into Extraordinary

For some reason, if there’s a business book related to Starbucks, I just have to pick it up and usually wind up going through it as quickly as one of my favorite mocha’s.

This week I ran across The Starbucks Experience: 5 Principles for Turning Ordinary Into Extraordinary by Joseph Michelli. This book is the result of an 18 month study of what makes Starbucks work by the author.

Starbucks has been one of those companies that completely fascinates me. From everything written about them, they are run a lot differently than most companies one reads about. Their commitment to their customers, employees, and communities in which they reside is really unparalleled in the business world and I am constantly wondering how they make it work.

This book gives you some insight. In it, Michelli outlines the 5 principles that the Starbucks leadership team instills in its “partners” through tons of training and consistent modeling of behaviors by senior management.

  1. Make It Your Own – Starbucks goes to great lengths to educate their employees on their products. They also allow their employees (or “partners” as their called) to do whatever it takes to ensure a positive experience by the customer of the company. Each employee is encouraged to take action as if the company were his own.
  2. Everything Matters – Starbucks employees are trained to pay attention to the smallest details. Within this principle the author makes a distinction between “above deck” and “below deck” activities. The “below-deck” activities are those which the customer does not see. Great care is taken at Starbucks to pay attention to the “below-deck” activities. Traditional business find it “OK” to cut corners on below-deck activities to cut costs. Starbucks views these activities as just as important as customer facing ones. It is understood at Starbucks that in order to deliver quality, you have to deliver it at all levels of the business. Any compromises can relax “quality awareness” throughout the organization.
  3. Surprise and Delight – Cote actually addressed this principle fairly well in a recent posting where he talks about how companies can “unexpectedly delight him” by doing things he wouldn’t expect but are useful to him, the customer (see the “Making My Life Easier” section). At Starbucks, one of the primary principles the company is built on is cultivating this ability to delight customers and go beyond their expectations. The book gives some really good examples of this type of behavior.
  4. Embrace Resistance – This principle is all about accepting feedback, both positive and negative – and using the negative feedback to feed into the business to find lessons to improve. The company finds all feedback important. A recent example of this is its response to Oxfam America and its efforts to get Starbucks to use its leverage to stand up for the Ethopian Coffee Farmers. Rather than ignore the feedback, Starbucks responded – constructively and calmly, explaining its position on the issue. Accepting and responding to feedback is built into the core principles of the company.
  5. Leave Your Mark – The final Starbucks principle is built around being involved and contributing to the communities in which it resides. Starbucks has a strong commitment to contributing to the community around them. This chapter focuses on the social aspects of the company, including its activities concerning the environment and various social issues.

To me, these seem like some pretty solid principles to build a business on. It almost seems “too ideal to be practically possible”. One thing that comes out fairly strong in most of the books I read about Starbucks (and Toyota as of late) is the acknowledgment of senior managements importance in setting the culture, ideals, and principles of the overall business while giving the “people doing the work” the ability to act within the framework of the principles. It seems that the more I read about these two companies, the more there is in common between them at a high level.

A book that I would be really interested in reading would be a book focused on the IT practices and principles in both companies. It seems to me that it is really easy to push down authority in a company which is distributed across the country, while that same practice in a corporate environment (especially IT, which is traditionally looked at as a “necessary evil” and liability rather than an asset) would be a little harder to foster this type of culture. I would be extremely interested to read an honest, detailed descriptions of how these areas of the company are run within the context of the overarching principles.

But here I go, digressing again. I thought The Starbucks Experience: 5 Principles for Turning Ordinary Into Extraordinary was an excellent book and would recommend it to anyone managing people. It documents an interesting framework for running a business and is full of great examples of each principle to illustrate application of the principle to “real life” in a business.

Lean Principles from the Source

I’ve started reading The Toyota Way: 14 Management Principles From The World’s Greatest Manufacturer by Jeffrey Liker. I’ve figured that as my curiosity peaks on Lean Development and Lean Principles in general, I might as well go to the source.

Chapter One opens with a quote from Fujio Cho, the president of Toyota Motor Corporation from 2002. I read the quote and thought I’d post it up here.

We place the highest value on actual implementation and taking action. There are many things one doesn’t understand and therefore, we ask them why don’t you just go ahead and take action; try to do something? You realize how little you know and you face your own failures and you simply can correct those failures and redo it again and at the second trial you realize another mistake or another thing you didn’t like so you can redo it once again. So by constant improvement, or should I say, the improvement based upon action, one can rise up to the higher level of practice and knowledge.

Toyota is thought of as one of the most process oriented companies around, and yet they still acknowledge that you do not know everything up front and build that into the process. A book that starts out this way has got to be one interesting read!

A Samari in the Senate: Jason Calacanis Talks About Working in a Large Company

A portion of this weeks edition of the Gillmor Gang (MidTail Gang – part IV – ugh!) really hit home for me this week. At around 14:34 in the sub-episode, Jason Calacanis talks about how he feels as an entrepreneur working in a big company. This section lasts through the end of the sub-episode. You have to give this a listen.

I don’t think what Jason is saying is necessarily only a view from an entrepreneurs perspective, but applies to anyone who wants to execute and has built their career on the ability to execute. As a company grows larger and things get more political, it becomes extremely difficult to execute anything, which can become extremely frustrating for anyone who just wants to get things done without having to talk about it for three months.

One quote that Jason threw out bears repeating:

Centralization and consolidation, I think, are two of the worst forces for building great product. Once you centralize stuff and put in controls, it just – it kills the process.

I think its great that Jason can be so honest about the experiences he is having at AOL. You rarely hear someone talk about these things and it was very refreshing to hear something that hit so close to home.

I must have listened to this section about 4 times last night on the way home. This section, in and of itself, was worth the 5 part download yesterday.

Perfection

I’m currently reading Lean Thinking : Banish Waste and Create Wealth in Your Corporation by James P. Womack and Daniel T. Jones in my quest to learn more about lean principles in general.

During my reading this evening, I came across this quote that I really liked.

Perfection is like infinity. Trying to envision it (and to get there) is actually impossible, but the effort to do so provides inspiration and direction essential to making progress along the path.

This kind of reminds me of this Bruce Lee quote:

A goal is not always meant to be reached, it often serves simply as something to aim at.

People tend to think of goal setting from only the S.M.A.R.T. (Specific, Measurable, Attainable, Realistic and Timely) perspective. While these goals are important, and give you an idea of short term goals, the idea of a BHAG (Big Hairy Audacious Goal) as outlined in Jim Collins Built to Last: Successful Habits of Visionary Companies are also very important, as they give you somewhere to move towards.

Just a little something I was thinking about this evening after reading that quote. Goals of the ‘Big Hairy Audacious’ type, with buy in and commitment from everyone, can be a really good way to drive behavior in a long term direction rather than keeping everything at an attainable and realistic viewpoint, which can often keep us in a very short term frame of mind.