Org changes and Leadership

1. O R G A N I Z A T I O N A L C H A N G E
&
L E A D E R S H I P
Starbucks Coffee

2. Complexity of Change
 Planned change and organizational life cycles
 Start-up
 Holiday season beginning in October
 Growth / harvest
 October through early January
 Decay
 Holiday season ends in early to mid January and Spring begins
 Every year Starbucks plans a new holiday cup design

3. Typical Problems Associated with Change
 Lack of management support
 Managers don’t want to make the changes
 Top managers forcing change
 Managers are not consulting other team members
 Inconsistent action by key managers
 Confusion in the workplace
 Unrealistic expectations
 Sales goals are to much to achieve in a short amount of time

4. Typical Problems Associated with Change
 Lack of meaningful participation
 People don’t want to change with the program
 Starbucks customers were not happy with rewards program changes
 Poor communication
 Unclear goals
 Purpose of program was not clear
 Why is the change taking place
 Starbucks explained the rewards program change to baristas to
explain to customers
 Responsibility for change not properly identified
 Who is supposed to make changes

5. Strategies for Communicating Change
 Tell and sell
 Management selects a limited set of messages regarding core
organizational issues. Management “tells” employees about
these issues and then “sells” employees on the wisdom of the
chosen approach
 To the Partners:
 Emails from top management, COO Kevin Johnson
 Partner hub (website partners use to access store information and
resources)
 Team meetings

6. Strategies for Communicating Change
 Underscore and explore
 Management focuses on fundamental issues related to change
success and allows employees the creative freedom to explore
various possibilities
 To the partners:
 Partners get to change the displays and advertising with some
variation from the plan sent from corporate

7. Strategies for Communicating Change
 Identify and reply
 Management listens to and identifies key concerns for
employees and then responds to those issues as they are
brought up
 To the partners:
 What are the best ways to sell our products
 How can we improve our sales with techniques and relationships

8. Strategies for Communicating Change
 To rewards members
 Emails
 Special offers
 Free rewards
 To the world
 New drinks are sporadically announced to Starbucks fans
 Social media such as Twitter
 Advertisements on Snapchat

9. Unplanned Crisis
 The War on Christmas (CNBC)
 The 2015 holiday season red cup did not feature any holiday
designs such as snowflakes or reindeer
 Customers furious at the lack of holiday designs.
 “blowing off Christmas” and “reeks of political correctness”

10. Unplanned Crisis
 Precrisis
 Signal detection, prevention, and crisis preparation
 Starbucks: no warning signs and did not anticipate backlash from
their new cup design
 Crisis
 Trigger that threatens and organization must make sense of what is
happening
 Starbucks: acknowledged angry customers and why they were mad
 Postcrisis
 Responsibility and maybe apologizing
 Starbucks: said the cup was a blank canvas for people to create their
own stories. (King)

11. Starbucks Company Hierarchy

12. Starbucks Transformational Leadership
 Intellectual Stimulation; challenge the status quo; they
also encourage creativity among followers. The leader
encourages followers to explore new ways of doing things
and new opportunities to learn.
 Baristas are encouraged by their superiors to create themselves as an
individual and create their own style
 Individualized Consideration; offer support and
encouragement to individual followers. Foster supportive
relationships by keeping lines of communication open so
that followers feel free to share ideas.
 Managers constantly are asking their coworkers for feedback with
how the store is doing and asking for suggestions

13. Starbucks Transformational Leadership
 Inspirational Motivation; have a clear vision that
they are able to articulate to followers. Able to help
followers experience the same passion and
motivation to fulfill these goals.
 Starbucks mission statement
 Help customers find their favorite drink
 Encouraging partners to want to create the best experience
possible for both them and the customer
 Baristas are encouraged to become
shift leaders and managers

14. Starbucks Transformational Leadership
 Idealized Influence; serve as a role model for
followers. Because followers trust and respect them,
they emulate this individual and internalize his or
her ideals
 Managers set a good example
 Continuous education from coworkers
 Helping customers understanding drinks and answering their
questions

15. Starbucks Framing
 Metaphors
 Partners constantly have to use metaphors to help customers
understand drinks. They have to describe the taste or
consistency of a food or drink to someone who has never had
it, but say it is similar to another food or drink.
 Contrast
 Partners have to help customers decide between drinks
 Ex. Hot or cold, sweet or savory
 Stories
 Feel, felt, found stories
 Ex. Partner have difficult time catching on when they are first
hired

16. Why It All Works For Starbucks
 The channel of communication allows partners to
receive information quickly and clearly
 The transformational leadership from Howard
Schultz allows partners to be involved and promote
productivity
 Leadership in turn creates partner and customer
loyalty
 Communication is formulated to create better
relationships between top leaders, baristas, and
customers

17. Questions
 What are some ways that Starbucks shows signs of
being a transactional or contingent leader?
 Are there ways that Starbucks could improve their
communication to both their employees and
members?

18. Suggestions
 Starbucks could change the way that members earn
rewards, such as having them come into the store to
interact with the baristas
 Reform positions to allow more baristas to become
shift leaders and mangers

19. Works Cited
 King, C. (2015, November 13). Social Media Today:
Starbucks’ Response to Red Cup Controversy? Let
Social Sort It Out. Retrieved March 30, 2016, from
http://www.socialmediatoday.com/social-
business/starbucks-response-red-cup-controversy-
let-social-sort-it-out
 No author (2015, June 22). Starbucks Melody:
Starbucks Leadership Changes: Organizational
Moves. Retrieved March 30, 2016, from
http://starbucksmelody.com/2015/06/22/starb
ucks-leadership-changes-organizational-moves/

20. Works Cited
 Whitten, S. (2015, Friday 13). CNBC: Starbucks
Holiday Red Cup Brews Controversy On Social
Media. Retrieved March 30, 2016, from
http://www.cnbc.com/2015/11/09/starbucks-
holiday-red-cup-brews-controversy-on-social-
media.html