Starbucks’ Schultz Hands Over the Reins Once Again

Starbucks’ Schultz Hands Over the Reins Once Again

Starbucks founder and longtime CEO Howard Schultz passes the torch to his president, board member and longtime friend Kevin Johnson today. Noting that Schultz has left Starbucks in the past only to return to the CEO’s office twice, Washington Post columnist Jena McGregor wonders whether this succession will be more successful than the previous attempts:

Now, Schultz and Johnson will again attempt one of the most delicate transitions in all of business: The handoff by an iconic, wildly successful CEO or founder to a successor. It’s a paradigm of its own, fraught with potential for ego clashes and muddled lines of authority, and one of corporate America’s most precarious high-wire acts. For founders and CEOs closely associated with a brand’s success, their identities “are often hyphenated with the enterprise,” says Jeff Sonnenfeld, a professor at the Yale School of Management. …

That division of specific roles and responsibilities is also what observers say could help the succession stick this time around. Schultz has carefully outlined what he plans to spend his time doing in his post-CEO role: Running the company’s premium Reserve brand and shepherding its Roastery locations, the company’s new sprawling tasting-room style temples to coffee. In addition, he’ll continue to lead the company’s social impact initiatives, such as hiring refugees across its global locations and offering college benefits to baristas. “He’s got meaningful projects to work on, something he’s really impassioned about,” said Sonnenfeld, who described Schultz’s role in the first CEO handoff as less well-defined.

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HR as PR in the Age of Trump

HR as PR in the Age of Trump

Over the past few years, companies have increasingly been pursuing “HR as PR,” which entails using HR strategies to differentiate their organization not only from their talent competitors, but also for customers. The message these companies are sending to customers is: “because we treat our employees well (and therefore have good quality employees), you should buy our product.”

Until now, most HR-as-PR strategies have focused on topics that were not controversial from a consumer perspective: Who would be upset that a company increased the amount of parental leave they offer their employees, or raised entry-level wages?

But when it comes to responding to the policy decisions of the new Trump administration, CEOs and heads of HR are being challenged on what their HR as PR strategy should be and how they should respond to changes in immigration, visas, trade, and other White House initiatives. Many more corporate leaders than usual are choosing to take public stances on contentious political questions, and that has consequences for their organizations and their heads of HR, as Steve Boese remarks:

[O]nce the CEO of the organization takes a public stand on issues as divisive as these, it sets down a kind of organizational culture marker that will be just about impossible to ignore or alter in the future. When the CEO comes down hard in opposition (or support) of these kinds of flash point debates, and if he/she commits organizational resources (time, money, products, services), on one side or another, the message gets pretty clear, pretty fast.

And no matter what side of this (or the next big issue) that the CEO does come down on, (and one last reminder, I am not telling you what I think about this, or what you or your CEO should think), there is almost certainly going to be a cohort of stakeholders, (employees, customers, candidates), that are not going to see eye to eye with your CEO, and by extension, your organization. …

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Starbucks’ CEO Succession Hits the Right Notes

Starbucks’ CEO Succession Hits the Right Notes

Starbucks CEO Howard Schultz, whom the New York Times describes as “the Steve Jobs of coffee,” announced on Thursday that he would step down as chief executive next spring, handing the reins to Kevin Johnson, currently the company’s president and a member of its board, as well as a good friend of Schultz’s:

Mr. Schultz, one of the most visible chief executives in the country, has made Starbucks a vocal part of the national conversation on issues like gun violence, gay rights, race relations, veterans rights and student debt. The succession will take place on April 3, and he will remain at the company as executive chairman, focusing on the company’s involvement in social causes and on growing Starbucks Reserve, the company’s new superpremium brand and chain of high-end stores.

News of the departure of a successful CEO, especially a visionary like Schultz, can have a significant impact on a company’s market value—indeed, when Schultz left the company for the first time in 2000, shares of Starbucks declined precipitously. The stock price dipped after this announcement, too, but quickly began to rebound, and several analysts told Reuters on Friday that they weren’t too concerned about Schultz’s departure having too many ill effects this time around:

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