The Schultz Legacy on Corporate Leadership

 Howard Schultz is stepping down as executive chairman of Starbucks, the coffee company that he made ubiquitous and iconic for what it served customers and how it treated employees. Schultz, who may run for President in 2020, left an enduring legacy of corporate leadership.

Howard Schultz is stepping down as executive chairman of Starbucks, the coffee company that he made ubiquitous and iconic for what it served customers and how it treated employees. Schultz, who may run for President in 2020, left an enduring legacy of corporate leadership.

The decision by Starbucks Executive Chairman Howard Schultz to step down is fueling speculation of a 2020 presidential run. There is no need to speculate on Schultz’ enduring impact on the rules of corporate behavior.

After announcing his decision, Schultz didn’t spare his criticism of President Donald Trump, the “political class” and Democrats. “My concern is for the country,” Schultz said in an interview with CNN Money. “I think we can do much better. I think the political class as a whole has been reckless.”

No one could accuse Schultz of being a timid businessman. He traveled to Italy in 1983, became enamored with Italian espresso bars and launched a US version in Seattle in 1984.

“Starbucks started hosting Facebook promotions in 2009, before most restaurants had even figured out this was a space they needed to be in,” Forbes reported. “While most brands were still experimenting with mobile payments in 2014, Starbucks was generating double-digit transactions from the channel.”

Commercial success put Starbucks on the map, but arguably Schultz earned his iconic status by what he did for his employees and what he viewed as his communities. Schultz often said Starbucks was in the “experience” business, not the “coffee” business.

Under his aegis, Starbucks offered health benefits for employees – and extended those benefits to employee domestic partners 11 years before domestic partnerships were recognized in the United States. Employees can receive reimbursement for earning a college degree online through Arizona State University.

Struck by the challenges facing returning US military veterans, Schultz committed Starbucks to hire them and their spouses. Since making the pledge in 2013, Starbucks says it has hired more than 15,000 veterans and military spouses, exceeding the original commitment of 10,000 hires. Starbucks has renewed the pledge to hire 25,000 veterans and military spouses by 2025. The coffee giant also plans to dedicate more than 100 military/family stores where veterans and military spouses can connect with peers facing similar transitional challenges.

“We strive to bridge the divide between the 1 percent of Americans who have served in the US military and the 99 percent who have not,” says Starbucks on its website.

After a recent incident in Philadelphia when a Starbucks manager called police to remove two black men, Schultz undertook a company-wide effort to provide employees with anti-bias training. The four-hour training affected employees at 8,000 company stores, which were closed for an afternoon. Schultz took a beating on social media and was greeted with skepticism that a single training session could alter deep-seated, often unconscious bias.

Schultz lets criticism roll off his back. When a Starbucks shareholder expressed disappointment at the company’s support for gay marriage, Schultz shot back, "Not every decision is an economic decision."

“As a business leader, my quest has never been just about winning or making money,” Schultz says. “It has also been about building a great, enduring company, which has always meant striking a balance between profit and social conscience." It’s worth noting the value of Starbucks’ shares since the company’s initial public offering in 1992 has risen 21,000 percent.

Schultz seems unlikely to slip out of sight. Americans may see him on the political stump advocating his brand of leadership in a global environment.

Gary Conkling Image.jpg

Gary Conkling is principal and co-founder of CFM Strategic Communications, and he leads the firm's PR practice, specializing in crisis communications. He is a former journalist, who later worked on Capitol Hill and represented a major Oregon company. But most importantly, he’s a die-hard Ducks fan. You can reach Gary at garyc@cfmpdx.com and you can follow him on Twitter at @GaryConkling