As it looks to improve the way its new ideas are brought to market, Starbucks is turning to one of its biggest resources: its coffee shops.
The Seattle-based coffee giant, working through an extensive overhaul process, is giving store managers the ability to test ideas at an early stage of development, everything from operations changes to new menu items.
Called “Starting 5,” the process takes five of its cafes to test an idea and communicate regularly about how well it works.
“In my lifetime, my career, anytime I’ve had a problem, I go find a Mountain Dew and a manager and say, ‘Tell me about this. What do you think?’” Chief Operating Officer Mike Grams said in an interview. “And you could usually get 90% of the solution right there in that moment, one hour. The idea of the Starting 5 was much like that.”
Starting 5 is part of a series of changes designed to improve operations inside Starbucks shops. The changes include a new “Green Apron” service model that Grams said represents the largest single investment in staffing in company history, while giving managers more say in how that staff is deployed.
The company also plans to boost in-store management and it is testing a new AI-powered assistant, called Green Dot Assist, designed to help employees—which Starbucks calls partners—with everything from how to make a Lavender Oatmilk Latte to figuring out what’s wrong with the espresso machine.
Starbucks revealed the changes to some 14,000 store managers from around the world at its Leadership Experience 2025, or LE 25, its first such gathering in six years.
They come as the company is working to turn around a business that has proven to be more troublesome and persistent than expected. Same-store sales have now fallen for five straight quarters, which prompted a management and organizational overhaul. The event served as something of a coming out party for that management team, including CEO Brian Niccol.
In-store operations are considered vital to the company’s comeback effort. Starbucks wants to speed service, so customers get their beverages in four minutes or less. And the company wants to make its stores friendlier for in-store customers.
That’s not an insignificant thing. Starbucks pulled 30,000 seats out of its coffee shops after the pandemic. “We’re going to put the seats back in,” Niccol told a crowd of cheering baristas.
He recalled a visit to one store where a manager asked Niccol to take their store off the renovation list, because they did not want to lose seats—and therefore customers.
“That experience of the coffeehouse defines our brand,” Niccol said. That’s true for mobile orders, too. “When they pick up their mobile order they’re going to pick it up in the world’s best coffeehouse.”
Starbucks CEO Brian Niccol received a standing ovation from 14,000 store managers. | Photo by Jonathan Maze
Hiring from within
One such change the company plans to make is the addition of assistant managers inside each store, a plan that will be rolled out next year. Starbucks believe those assistants will provide greater leadership coverage inside stores while enabling store managers to take days off when needed.
That will also be key for leadership development as the company works to expand. Starbucks believes it can double the number of company stores it has in the U.S., from the 10,000 it currently has. It wants leaders of those stores to come from within. Starbucks’ goal is that 90% of leadership roles will come from internal promotions.
The company will increase staff inside its stores in the short-term. Starbucks plans to deploy its new “Green Apron” service model into all its North American stores by the end of summer, which will add staff into its stores.
The model will enable managers to deploy more baristas into its coffeehouses to improve service, which could improve sales during busy periods as managers add workers to handle the traffic. It could also make operations better during slower times.
Starbucks is deliberately avoiding using a “script” or an “algorithm” to determine how stores should be staffed, putting the decisions into the hands of managers and their district managers.
“You know your coffeehouse,” Grams told the managers. “You’re going to be making the decision with your district manager, your regional manager, on what makes sense to unlock your morning and smooth out afternoons.”
He added that the company should be choosy about who those managers hire. “Only the best people can become partners at Starbucks,” Grams said.
Starbucks baristas in Las Vegas often wrote "LE 25" to mark the Leadership Experience event. | Photo by Jonathan Maze
Starting 5
To test that service model, Starbucks used Grams’ Starting 5 model with five stores in the Chicago area. Those stores increased sales in the morning and had better customer service scores, Grams said. “They finally feel they have the right number of partners,” he said.
Grams vowed to use the “Starting 5” process more often as it tests new menu items and other ideas. The company is currently using the Starting 5 model to test some new menu items for its cafes, including new fresh baked food such as a Butter Croissant, a Raspberry Croissant and a Double Chocolate Cookie. It is also testing protein in coffee, such as an Iced Caffe Latte with Banana Protein Cold Foam.
The product expected to come to market quickest is a Brown Sugar Strato Frappuccino, set for release this summer. The drink features a blend of Frappuccino Roast coffee, milk and ice with a layer of brown sugar cream cold foam and topped with cinnamon.
Starbucks is a massive global chain with well over 40,000 global locations. That immense size can slow down the testing and implementation of new ideas.
It can be difficult for companies this big to pivot and move more quickly, Grams said. Yet speeding the testing process the wrong way can lead to mistakes. So, Starbucks has decided to put these decisions into the hands of its shops at an earlier stage, which can help determine problems.
“Go to five coffeehouses, pick five store leaders that are passionate about what they’re doing, they’re familiar with the problem, and ask them to solve it,” Grams said. “And then support them with the tools, whatever it is, financials, whatever, and we create this little ecosystem.”
“They’re talking about the things that go on behind the bar,” Grams added, “which is not stuff we can get from Seattle.”
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