Onward: A book review by Bob Morris

Onward: How Starbucks Fought for Its Life without Losing Its Soul
Howard Schultz with Joanne Gordon
Rodale (2011)

“Starbucks’ touchstones, the source of our pride” Howard Schultz

In January 2008, chairman Howard Schultz resumed his roles as President and CEO of Starbucks eight years after he relinquished them, replacing Jim Donald, who took the posts in 2005 but was asked to step down. Schultz’s immediate objective was to restore what he called the “distinctive Starbucks experience” after years of rapid expansion that had compromised it. The bulk of this book’s material covers the period since then, although Schultz (in collaboration with Joanne Gordon) does include valuable perspectives on the events that preceded his joining Starbucks as director of retail operations in 1982 and his subsequent purchase of the company from its three co-founders in 1987.

Others have their own reasons for praising this book, Here two of mine. First, Schultz is a skillful raconteur and the dramatic narrative that he provides is compelling as he introduces various characters, develops a lively plot filled with crises as well as triumphs, and meanwhile examines several themes that invest the narrative with structure and direction. For example, how to accelerate but manage growth so that the company (however large it may become) retains its entrepreneurial spirit? As Starbucks expanded into new locations, states, and even countries, how to preserve the ambiance of an Italian café (i.e. coffeehouse) while take full advantage of modern technologies? This book is a great read because Schultz has a multitude of fascinating stories to share.

My other reason is that the book anchors in real-world situations, involving real people, a number of business principles that are relevant to all organizations, whatever their size and nature may be.

For example:

1. Don’t “fall in love” with loyal, devoted workers who no longer measure up. By all means employ them and find useful work for them to do (if at all possible) but keep in mind that business development (especially when growth is rapid) frequently creates new demands that some people cannot handle. Schultz acknowledges that he waited too long to respond to earnest and willing but clearly under-performing employees of whom he is obviously fond and for whom he feels genuine appreciation.

2. Do not confuse investments with costs. Schultz was (and remains) a passionate advocate of frugality but eagerly made (and makes) substantial investments in people (e.g. generous benefits for part-time workers) and equipment (e.g. purchasing only the very best beans, state-of-art onsite brewers). Compromising quality to save money is never a “bargain.” On the contrary, the total cost of a so-called “bargain” is often prohibitive.

3. No matter what, always preserve and nourish your core business. For Starbucks, its core is the multi-sensory experience that offers a “third place” renowned for its hospitality, ambiance, indeed its panache. Offer, serve, and sell only what enhances each patron’s experience. Also, hire only those who will be evangelists as well as facilitators of that experience. There is no reason why where they work can’t be as enjoyable for them as it is for those whom they are privileged to serve.

With regard to the title of the book, it refers to a process, not a destination. Schultz stepped down when he thought the company could continue to improve, returned when he realized that it hadn’t and couldn’t without him, and since then he makes certain that the process continues into an otherwise uncertain future.

This is among the most entertaining as well as informative accounts by a CEO that I have read thus far, worthy of inclusion with those written by Alfred Sloan, Andrew Grove, Sam Walton, John Whitehead, Jack Welch, and more recently, Danny Meyer and Chip Conley.

Thank you, Howard Schultz, for the pleasure of your company!

Posted in

Leave a Comment