Starbucks Isn't What It Once Was

Howard Schultz is CEO of Starbucks again, but only on an interim basis while the company continues to work to "reinvent" and/or "reimagine" itself. In a lengthy piece for Fast Company, Clint Rainey looks at why that's needed. Schultz's original vision came to life as "the third place," somewhere between the toils of home and office where comfort, community, and caramel Frappuccinos await. That vision propelled Starbucks to third place among global fast-food chains (behind McD's and Subway). Along the way, it built a reputation for progressive employee benefits, strong diversity and inclusion practices, and good corporate governance. It also became a darling on Wall Street. Now, according to Rainey—and pretty much every customer, employee, and investor who spoke on the record—all of that is in jeopardy.

In 2017, Schultz handed the CEO reins to Kevin Johnson, who brought his IBM and Microsoft experience to bear in Deep Brew, the AI brain behind the popular Starbucks app. The app has been good for Starbucks' financial picture but less so for its third-place vibe, and it has made life harder for baristas because it encourages more complex, customized orders. That’s just one reason why employees are organizing. As one Richmond, Virginia-area barista puts it, "Partners miss that sense of community, and we feel pretty strongly that a union is a community." And while the company was once a progressive standard-bearer, and still excels on some fronts (its workforce is 69% female and 47% minority), it has weakened in other areas, particularly health insurance and its college plan, which is now less robust than what is offered by Walmart and Target. (Read the full piece for much more.)