The man that made Starbucks an industry superpower steps down
Starbucks Corporation Executive Chairman and — until last year — CEO of four decades, Howard Schultz, is stepping down. He leaves a huge trail of successes in his wake, including a 21,000 percent gain in stock value since the brand's IPO in 1992 and a reputation as a company known for doing good in a highly competitive industry.
A news release said Schultz will relinquish his position as executive chairman and member of the board on June 26, when he will the honorary title of chairman emeritus effective.
"Because of your creativity, your hard work, and the love that you have poured into the company, Starbucks today is widely embraced and respected," Schultz told those who work at the company in a letter addressed to them late Monday. "As I prepare to step away, I'd like to humbly remind you not to lose sight of what matters most — your fellow partners and our customers."
The company said that under Schultz's leadership the brand's global growth was accelerated by his decisions to provide uncommon benefits for those who work for Starbucks, including comprehensive healthcare, stock ownership and free college tuition, even for those working part-time.
"I set out to build a company that my father, a blue-collar worker and World War II veteran, never had a chance to work for," Schultz wrote in the letter to team members. "Together we've done that, and so much more, by balancing profitability and social conscience, compassion and rigor, and love and responsibility."
Creating 'a third place' between home and work
Schultz's journey began as director of operations at Starbucks in 1981, where he pushed for the brand to use the highest quality coffee after a business trip to Italy, where he was captivated by the sense of community, romance and even theater found in Italian coffee bars. In the ensuing years, he purchased the company with local investor support and pledged to make a career out of bringing his vision of a modern coffee house to life in America and around the world.
During his leadership, he sought to make the brand's locations a "third place between home and work," where customers would encounter a comfortable, welcoming environment where they could have positive experiences, built on community and human connection.
Schultz has been named as one of The World's Most Influential People by Time magazine as well as Business Person of the Year by Fortune. Most recently, Schultz has received the Robert F. Kennedy Ripple of Hope Award and has been presented with the Atlantic Council's Distinguished Business Leadership award and the NAACP LDF (Legal Defense and Education Fund) National Equal Justice award.
This year, Starbucks was named the fifth most admired company in the world by Fortune, marking the sixteenth consecutive year the company has been listed on that global honor roll. Starbucks was also named one of the World's Most Ethical Companies by the Ethisphere Institute for the twelfth straight year and was ranked as one of 2018's Most Innovative Companies by Fast Company, most notably for its social-impact work.
Last April, he transitioned from CEO to executive chairman, shifting his full-time focus to the company's social impact initiatives as well as innovation and global development of the company's premium Reserve brand, including Starbucks Reserve Roasteries, Reserve stores and the company's partnership with renowned artisanal Italian bakery, Princi.
The road forward
Following his transition off the Starbucks board at the end of June, Schultz will oversee the opening of the Starbucks Reserve Roastery in Milan on Sept. 6, marking the company's long-awaited entry into Italy. He will then oversee opening of the New York Roastery in late October this year.
Myron E. "Mike" Ullman steps into the role of the board's new chair, while Mellody Hobson will serve as vice chair effective upon Schultz's retirement
"There are no words to fully express our gratitude to Howard for the extraordinary company he has built," said CEO and Board Member Kevin Johnson, in the release. "He's helped Starbucks earn the respect of millions around the world by always being true to a higher calling, and always being bold in creating a better future. He's taught all of us that it's possible to be a very different kind of public company. That must, and will, continue on my watch."
In Schultz's letter to partners, he thanked them for their collective efforts to build a different kind of company.
"Because of your creativity, your hard work, and the love that you have poured into the company, Starbucks today is widely embraced and respected," he wrote. "As I prepare to step away, I'd like to humbly remind you not to lose sight of what matters most: your fellow partners and our customers."
He also expressed deep confidence in the team that will continue to lead the company.
"Kevin Johnson is a true servant leader, and he will lead Starbucks as this great company enters its next journey," Schultz said in the letter. "It's our duty as leaders to constantly re-imagine Starbucks. I am honored to call Kevin my friend and partner. And Starbucks is fortunate to have him. This leadership team is extraordinarily capable. They, too, believe that Starbucks has a responsibility to use our scale for good."
Schultz is is also writing a book about Starbucks social impact work and the efforts to redefine the role and responsibility of a public company in an ever-changing society.