Krishna
A caveat to start the review : This book was published before the year 2000 and the author has written a couple of other books as well later. So I do realize that the review of the book may not be the author’s current views.
It was co-written with a journalist. It is a business book, about Starbucks.
Fred Schultz, the author’s father, was a truck driver of diapers – both pick up and delivery. (The author, of course, is the face of Starbucks). He talks about his joining Starbucks which was, in 1982, a small retailer with just five stores. There is a whiff of self congratulation that jumps out from the first page. It is great to say ‘Look at what we built!’ kind of pats in the back but when it is glorified in terms of ‘This is the company that everyone LOVES to work for. It treats it lowest employees like executives in other companies’, then it becomes a lot harder to swallow.
Plus, it falls between the two stools (in my opinion) of inspirational book and a business book. See for example this segment : “Once you overcome seemingly insurmountable obstacles, other hurdles become less daunting. Most people can achieve beyond their dreams if they insist upon it”. Do you see what I see? And it goes on like this for half a page here and in many other places in the book.
OK. Probably like you, I am a bit skeptical about a CEO talking about how great his company is, and understandably so. The CEO is the one who shaped the company and therefore ‘everything that the company does is for the best’ is the mindset you think they will have. However, as you read this book, the personal details revealed make you change your mind (somewhat). His struggles to find a place in the company in Seattle, his willingness to take a pay cut for the passion, his refusal to take ‘No’ for an answer when they at first declined to give him a job, his personal side (planning to marry Sherri and his father’s heart attack) introduce a touch of realism and make him more human even to a person starting out as a skeptic, like me.
The history of Starbucks, while not unusual (similar to McDonald’s for example whose founders were happy to run a burger shop in one corner of America), are still interesting. None of the three partners who founded it had business or even coffee experience (except as a user) in the coffee making business and nor were they interested in anything grubby like profits or expansion. Cute.
But the sop is still there. How ‘the moment he stepped into Italy he felt he belonged, even though he did not speak a word of Italian’ is an example.
But his epiphany on visiting Italy and seeing cafes dole out lattes to clients is interesting. He wants to convert Starbucks from a coffee seed selling company to a cafe, as it most famously became later.
I will give the author one thing : he is forthright. It is not all about ‘how great this company is’ as you come to realize when you read more. He talks of how there was resistance from the owners to the idea of opening a coffee shop (not a bean selling shop alone) and how he even decided to quit rather than seeing his dream die.
He goes out and creates another company called Il Giornale and the owner of Starbucks pitches investment money into it, a generous gesture.
He has run Il Giornello for a couple of years – not making profit but heartwarming growth – when he hears that Starbucks is for sale. He manages to get together the 4.5 million dollars to buy it back.
To be fair to the author, he explains the struggles he had to go through and audacious decisions he had to take even in the face of advice to the contrary. All great. But I guess that his belief in what he did gives some shade of ‘wow, look at my company!’ attitude, and it still peeks through, in my opinion, despite his efforts to be balanced.
He institutes a stock option for all employees. It definitely is not a gimmick as the stock options after the vesting period worked out to more than a year’s salary on some years. A radical move even in today’s world.
After these two inspired events, the book settles into how they grew the company, how they had the right executives in place etc. At least in this book, he gives credit where it is due and displays self awareness of his limitations in execution of processes etc. for example.
Yes, he talks the talk and explains the values that animate Starbucks (or animated when he was fully in charge). Through a collaborative journalist, of course. The only problem is that for people who read these A-list biographies of different companies, it all reads familiar. How they grew, how they defied the common perception to make something new or bigger; there is not a single ex CEO who will say ‘I didn’t know what I did but whatever it was, the company grew miraculously’ or something like that. So this part about the company going public, and the growth spurt despite the naysayers in the press, is, definitely ho-hum.
And I grant you that Howard tries to be down to earth and humble, for example how he resisted Frappuccino introduction and was wrong (OK, not entirely wrong based on the first trial as he says) but the book definitely settles into a regular corporate story – mostly eulogy of the company if not the founder – of the new things they tried and how they worked out.
So I would simply say that the story starts well and then settles into the corporate biography quicksand.
How great was this man we hired! How novel is the new path the company has taken! And so on. Yes, I get that this is a business book and about a company. The problem is that it is written by the founder, who sees glory in the company history and marvels at the new growth opportunities. The problem is in thinking that it will interest laymen equally. A business book can be fun throughout and I cannot help compare it with a much better executed ‘In the Plex‘ book we recently reviewed.
And therein lies the tragedy. After starting so well, it reverts to type as in ‘it was a scary decision; we did not know whether we would succeed; we had to make the right decision by the customers and the business; it succeeded beyond all expectations’ kind of gunk one after the other.
It just sinks from then on and goes to a corporate prattle that is hardly interesting. You don’t need the book to tell most of the things and it is painful to read this book descend to these levels.
It is, though, funny to hear Howard whine about the growing opposition to behemoths. One of the complaints is that it kills local coffee shops. Instead of accepting it, the author whines that ‘they are only against giant companies like packaged goods companies and not against coffee shops’. Interesting! Yes, his point about consumer choice is valid but ‘all of us benefit?’. Hardly. A behemoth does crush local stores, as Walmart has proved time and again.
And ironic that he rails against comparison to Walmart itself in a Newsweek article. OK, he is passionate about his company, I will grant him that, but blinded by that passion and conviction to the societal impact of ubiquitous Walmart. Which opens up all sorts of arguments about open competition etc, I know. But here the question is the entire denial that local vendors will be crushed when Starbucks opens yet another store.
More pats on the back ‘for introducing diversity, not as a political stance (mind you) but as a winning strategy for an international company’. And much more in this vein. I would conclude that you can put the book down after the first 100 pages and will not lose much of anything. He is enormously proud of the ‘satisfaction surveys’ conducted by a third party.
I know my skepticism shows but when Howard says that all barristas are extremely satisfied with their job, you wonder. Why are they all happy being ‘coffee flippers’ however nice the environment may be (And that itself is a massive generalization). Call me a skeptic.
Where did they get a 100% agreement? It was for ‘It is important to work in a company that you respect”. It is a ‘motherhood and apple pie” statement and not specifically asked about Starbucks. Call me a skeptic.
But he is absolutely on the ball about how large multinationals are targeted by diverse interest groups and asked to do impossible things about, for instance, foreign suppliers or conduct of some partner in a part of the business where Starbucks is not involved or influential. Absolutely right!
However, the self congratulatory pats are a bit too much for me and so I did not enjoy this book after the first little bit.
The last forty pages or so are excruciating whining from the author. ‘Wah! Why do they call our stores cookie cutter stores? Not true’ or ‘Wah! Why do they say we lost our way? We didn’t!’ or any of the others. He comes across as thin skinned for criticism and bristles at comparisons to other chains.
He bellyaches about the bad numbers in 1995 but says ‘numbers are not important to us; quality is’. So why the bellyache?
Anyway, if you have read the first 75 pages of this book, you can safely close it down and not miss much for the rest of the book.
3/10
— Krishna