Funny Starbucks Video Friday for May 24th, 2008

Howard Schultz Moment of Truth, Part 3

Disorder: Disturb in mind or make uneasy or cause to be worried or alarmed

This apparently is what happens when Howard walks into a room. He has that God like aura that other deities such as Steve Jobs and Jack Welch possess. This doesn?t come as a surprise to most of the people that deal with Mr. Schultz on a daily basis. He defines Starbucks and really is the soul of the organization, which is why he is going to be hard to replace when that day comes.

Why? Because along with the God like aura comes the usual founder control freak disorder, you know, when no decision no matter how small can be made without the afflicted party?s approval. There?s a great quote by former Starbucks executive and ex-board member Howard Behar ?Howard creates passion?.He also creates anxiety.? If that?s true, I commend Howard for getting the company where it is today. Normally, a founder this uptight blows up long before they reach anywhere near the success of Starbucks. The downside to this affliction is the people around you tend to kiss your @$$ and you don?t really get the candidness you need to execute.

One of my favorite books on the subject is Execution: The Discipline of Getting Things Done by Larry Bossidy and Ram Charan, Execution is "the missing link between aspirations and results," and as such, making it happen is the business leader's most important job. While failure in today's business environment is often attributed to other causes, Bossidy and Charan argue that the biggest obstacle to success is the absence of execution. They point out that without execution, breakthrough thinking on managing change breaks down, and they emphasize the fact that execution is a discipline to learn, not merely the tactical side of business.

Howard claims that he doesn?t want people to ?view him in any way that puts him in some status or rarefied air.? I say rarify your but off man, you built 16,000 stores; you know what you are doing. You hit a roadblock, but get the eff out there and get this done! Point is, this guy Schultz is a stud in my book, I can?t think of anyone else that I would want navigating the siren through trouble waters than our guy.

Howard Schultz Moment of Truth, Part 2

In yesterday?s post "Howard Schultz Moment of Truth, Part 1" I ended with the following sentence; ?Howard?s true enemies have yet to reveal themselves?and it?s not Nelson Peltz?. When Mr. Peltz announced his stake in Starbucks, the media went crazy and Starbucks stock shot up 6% just on his name alone, but I think this announcement isn?t all it is cracked up to be.

Why?

Nelson Peltz only purchased just over 842,000 shares, or one tenth of one percent of a company that is trading at a three year low. If you were looking to make waves, why wouldn?t you take a huge chunk and move this turnaround along at a faster pace? The size of the position is what tips Mr. Peltz?s hand. For comparison, he had to outright buy Wendy?s International to make a difference there, and when he announced his position in Cadbury Schweppes, it was for 3% of the company. 5.5% made him a player in Tiffany?s, while 6% was the magic number for Heinz. So the math just doesn?t add up, 1/10th of 1%? Not passing the smell test of someone looking to fill some seats of his own at the next Starbucks board meeting!

Besides, Howard Schultz is as close to a founder as you are going to get, which means he has a lot more skin in the game than your average bear, this guy has bled, sweated, and I imagine cried over the years for Starbucks, and oh by the way, he?s sitting on over 30 million shares or more than 5% of the joint?that?s a big number. All this conspires to make Howard Schultz a much more formidable opponent compared to the patsies Mr. Peltz has been up against in the last few years. I mean, the guy made the real life ?Wendy? cry when it was announced that he took over her Father?s company.

So unless Mr. Peltz is green-mailing this one in, or secretly acquiring more stock, he doesn?t stand a chance at being any type of influence in the current management of Starbucks. He may have some words with Howard, and he may make some suggestions that might even be worth listening to, but I wouldn?t look for any saber rattling coming this summer unless his position changes.

Who knows, maybe Mr. Peltz is taking my advice and longing the stock, or maybe he likes the coffee. Whatever the reason, his end game isn?t that of an agitator at this point, but who knows how long it will be before Mr. Peltz starts asking for a seat at the table?literally! Stay tuned tomorrow all you home gamers for part 3 when I talk about Mr. Schultz?s management disorder.

Howard Schultz Moment of Truth, Part 1

"With profits off and the stock sinking, Mr. Schultz has unleashed an intensity that is rattling the feel-good Starbucks culture.

Starbucks vs. Nelson Peltz Round 1

Starbucks Recipes Sunday for May 18th ,2008

Personally, I have never been a fan of the chains, and found it far better for my sanity, schedule and wallet once I got into the habit of making iced coffee at home.

Through experimentation I have also developed a whole new appreciation for the cold coffee drink. Sure I knew that coffee was a stimulant, but with some added fruit it became the power packed pick-me-up I needed before heading to the gym. And two tablespoons of yogurt made it a healthier liquid breakfast or evening snack than I had grown accustomed to.

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