Chain restaurants are often portrayed in popular culture as leeches on society, feeding on the lifeblood of local businesses and the very souls of hourly workers. Swept along by greed, they could care less about the greater social good.
To those critics, the industry need cite only one thing: Howard Schultz.
After racial tensions soured to a poisonous state in Ferguson, Mo., New York City and Chicago, Schultz convened gatherings of employees in five locations nationwide to address relations between persons of different colors. If that wasn’t controversial enough, he also spoke with police officials about social strains.
Remember, Schultz heads a public company whose business thrives or fails on the bases of perception and reputation, a reality that almost always leads retail-company CEOs to ply a safe course on controversial issues. And if they lapse, shareholders typically don’t hesitate to yank them back to purely business matters.
But as Starbucks has pointed out, race relations are a business issue; coffee sales declined nationwide after demonstrations and rioting erupted in Ferguson, shaking the public’s confidence. With Schultz, business and social sensibilities are as intermixed as the steamed milk and espresso in one of Starbucks’ lattes.
All of this emerged this week in Time. Schultz is on the cover, and the issue has been big news because it asks the question, Should this man run for the presidency of the United States?
Schultz gives a definitive “no,” and acquaintances are quoted as saying the former resident of public-assistance housing feels he can do more for society as a business leader than he can as a politician.
For restaurant executives, the gold in the story may be the naked indications it provides of Schulz’s management style. Here are some of the points to savor:
Big data isn’t a problem
Schultz receives four store-by-store sales updates every day for Starbuck’s 12,000-branch domestic operation, starting at 4:30 a.m. He’s confident enough of his analysis of the trends to call the White House and alert the executive branch to shifts in consumer confidence or spending behavior that economists might have missed.
Micro-management as a signature
Many CEOs wrestle with the question of how involved they should get in granular details of their business. Schultz is depicted in the article as being one step away from drawing lattes. In one scene, he suggests to a counter employee that the rack of holiday gift cards be slid forward a few inches. Subordinates are quoted as saying he’s involved in minutiae that even CEOs of an upstart would likely leave to people closer to the customer.
No strain between business and conscience
The thrust of the article is that Schultz has a soul as well as a personal worth estimated at $2.4 billion, and doesn’t seem torn between the two realities. He speaks (apparently regularly) with politicians and pundits about the need to keep alive the American dream and foster opportunity for the so-called 99-percenters, yet championed the launch of Starbucks’ new platinum-level Reserve concept and coffee line.
Consensus building
He’s apparently found the skill eluding Washington, D.C., of finding common interests across the political spectrum. Ultra-rightest and tax reformer Grover Norquist speaks favorably in the article of Schultz, who unabashedly voices interest in the politics of Hillary Clinton.
Controversy is not to be avoided—when it’s right
Starbucks stirred some controversy when baristas in the nation’s capital wrote “COME TOGETHER” on cups during the Congressional stalemate that led to a government shutdown. The article reveals that the practice was something that Schultz himself pushed on the associates.
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