The Leadership Style of Howard Schultz

Since Starbucks entered the coffee retail business, the company has made many trade-off business decisions. The first major trade-off was made when Howard Schultz wanted to acquire present day Starbucks from three entrepreneurs Baldwin, Siegel and Bowker. Therefore, Schultz prior to the acquisition made the trade-off to open his own coffee bar in 1986 instead of staying at Starbucks as the manager of retail sales and marketing. A bold feat, Schultz was able to replicate success and was offered to buy Starbucks for $4 million. At the time of the acquisition, many investors, including the former Starbucks owners, would not expect that the American consumer would pay a premium for coffee products. Schultz, after calculating the opportunity cost, was convinced that Starbucks would become a large coffee chain not only in the United States but internationally too. Reflecting this approach, Schultz’s trade-off worked. Starbucks, according to our book has revenue exceeding $13 billion and nearly 200,000 employees. The company has also expanded to 40 countries with 17,000 stores (Hill et al., 2015).

42). Training doesn’t stop there, however. Baristas can expose themselves to additional training if they desire to become Coffee Masters, Shift Supervisors, or Store Managers. In fact, Michelli (2007) reports, “Starbucks consistently spends more on training than it does on advertising” (p. 282). The Starbucks corporation feels that the Starbucks Experience starts with their employees. If their employees are happy, their employees create better experiences for their customers. This creative approach to the management of people shows. Michelli (2007) highlights that the turnover rate at Starbucks is much lower than at other similar establishments, “120 percent less than the industry average” (p. 282). He further goes on to mention that “employees have an 82% job-satisfaction rate” (p. 282). This deep desire to treat employees fairly stems from Schultz’s ideals. He himself mentions, “As a business leader, my quest has never been just about winning or making money; it has also been about building a great, enduring company, which has always meant trying to strike a balance between profit and social conscience” (Schultz, p. 107). Many believe his deep sense of empathy stems from his early childhood where his father was ill and could not hold a job. This is reflected today in his treatment of his employees. All

The CEO, Howard Schultz, has developed a mission and guiding principles of how the corporation should handle their day

Mr Schultz purchased Starbucks in 1987 and has transformed it to the successful business we know today. His vision was to create a place that people could enjoy a cup of coffee on the way to work or the way home. He wanted to build an atmosphere and community within the workplace where people could grow (Hedges, 2012). During his time away as CEO, the brand had lost its “community feel” and as a leader who's philosophy revolves around community decided to temporarily close down some of the branches in order to train the employees in the companies core principles, values and the importance of community (Webb, 2011). At the time this was considered to be somewhat controversial, yet he was very transparent and honest in his opinion as to why it had to be done and within a couple of years, the companies much valued philosophy of community had been restored. I believe his actions are of a leader who is true to his position, true to his beliefs and philosophy and his honesty and articulates this to followers

These two exceptional leaders also shared the leadership task related traits of emotional intelligence, passion for the work and the people and courage. An internal locus of control and flexibility was also evident in both leaders. In BuBrin 2013 page 46-50, where ‘flexibility and adaptability is necessary for a leader to be able to cope with change, especially because a leader is someone who facilitates change’. Howard Schultz embodied the very essence of flexibility and adaptability as when Starbucks needed to alter virtually everything about how it operated in order to survive, Howard chose to cut costs by $500 million, shut down 800 stores and lay off more than 4,000 employees

The extraordinary success Starbucks experienced during the early 1990s resulted from Howard Schultz’s passion and vision to create a coffee culture in the United States similar to the coffee culture he experienced while traveling to Italy. Schultz’s vision of the Starbucks brand evolved around providing a quality product while delivering exceptional customer service in an inviting atmosphere. Starbucks’ success can be attributable to the following factors:

First of all, Howard Schultz had a clear vision about his company. It is important for a great leader to have a clear vision about what to achieve. The emphasis on importance of employees is the outstanding point in his vision. This is why Starbucks has been investing in their

It left a lifelong impression on Schultz (Gallo, Forbes).” From his father’s struggles, Schultz realized he wanted to work hard to pursue a career he loved and was passionate about. Since Schultz did not have endless opportunities due to his families financial struggles, he needed to strive to be the best he could be, hoping that one day he would be able to provide for his family in ways that his parents could not. Schultz’s childhood and young adulthood struggles before his success qualify him as a twice-born leader, which is characterized by Warren Bennis as someone who has re-invented him or herself and become a leader due to their hard work and success while overcoming many obstacles. Bennis highlights in his book that often times it is much harder for people to become leaders when they need to overcome struggles such as financial setbacks or rough upbringings. While Schultz attended Northern Michigan University pursuing a degree in Communications, he probably never envisioned that one day he would be leading such a successful and prominent business. As he strived to work his way out of Brooklyn, he probably never imagined the endless opportunities that would be presented to him once he joined the Starbucks Corporation in 1982 when it was a very small company with just four stores (Mullin, 1).

Starbucks Coffee opened the doors to its first location in Seattle in 1971 and moved to its permanent home at Pikes Peak Market in 1976. The humble enterprise was the creation of three college friends; Jerry Baldwin, Zev Siegl, and Gordon Bowker. The original business model was to sell high-quality coffee beans and equipment. Between 1971 and 1986, the company expanded to 6 locations around Seattle. In the beginning, Starbucks did not sell one cup of coffee (Starbucks). The way that Starbucks evolved from its modest roots into the world’s leading coffeehouse company must be credited to the leadership and vision of Howard Schultz.

They generally chose exceedingly obvious areas and opened stores as groups. As interest developed, these store bunches made them ready to deal with the expanded movement and to keep their focused position. In the same way, they took think about the administrations gave in the stores. Howard Schultz expected to open the sentiment and secret of coffee in coffee bars, and he knew how vital the part of baristas in attaining

In the workplace, there are many leadership styles on display but how do I handle working with a manager whom I feel I cannot trust. On the other hand how do I respond differently to a manager whom I believe is trustworthy? And, last we will discuss which do I prefer and why.

It is pretty safe to say that Schultz exhibits numerous leadership traits and skills that Gary Yukl believes are associated with effective leaders. Schultz has been adaptable throughout the years that he has been with Starbucks, you can see this in the way he has changed Starbucks’ food items to create better quality items, his ability to keep up with technology with the Starbucks application for smart phone users, and his expansion with taking Starbucks locations globally. Schultz also has self-confidence which helped him come from the housing projects in Brooklyn, graduate from college and gain the courage to start his own espresso bar in the U.S. which has been a great success. He has been very persistent during the recession, still able to generate revenue during a time when people had very little money to spend. He also had to adapt to the hard times of the recession by closing some Starbucks locations and cut costs. With his self-confidence also came a great deal of intelligence, he not only has a college degree as previously mentioned, but he also has an understanding of people and how to manage a successful business. He possesses the social skills which have assisted him in being able to open locations in other countries and be as successful there as the locations in the U.S. have been (Plunkett, Allen, & Attner, 2013, p. 441). All of these traits and leadership skills are essential for excellent and effective leaders.

When coffee is called one of the first brands that comes our minds is Starbucks. The reasons for this success are not just coincidence; contrary they are the outcomes of a successful entrepreneur, Howard Schultz. Schultz was born on July 19, 1953 in New York, his family was poor and he was doing sports at the high school so he excelled at sports and won an athletic scholarship for Northern Michigan University. Schultz worked as a salesperson for Xerox Corporation after his graduation. He could start his own business at first but he decide to improve himself at working place. He was knew that with some experience in working area will help him in the future. He was quickly promoted to a full sales representative. Then he became a general manager for a coffee maker

Starbucks CEO Howard Schultz faced a great amount of criticism when an internal memo was leaked to the public. He felt betrayed, humiliated and hurt. However, the company was never the same after that memo. You see, in this memo, Schultz explained that the company had lost its way. No matter how bad the financial crisis got, there were certain components he wasn’t willing to trade in to save a dollar such as healthcare for all employees. In the memo, he was very clear about mistakes the company made in the past and how things needed an entire reset. For a company CEO to admit failure and

In the early 1980s Howard Schultz became interested in the specialized coffee market. He observed that there were only a few small coffee shops around the united states that did not have marketing budgets to expand or that they did not want to expand and were happy with only being a few shops. Howard Schultz noticed that of the coffee shops that were their i.e. Peats coffee house and Starbucks that its customers tended to be loyal and regular and also they would have