In this third and final piece of our Starbucks coaching and co-learning series, we reflect back on the challenges faced and the lessons learned as we tried to apply lean concepts across the chain starting around 2004-05.
When Scott, then the VP of Strategy at Starbucks, observed and then sought to fix problems in the coffee shops of having too much (wasted coffee each day, amounting to $50 million annually) and not enough (15% of the time a store would be out of a brewed coffee type), he was not in charge of operations. He had been assigned the task of improving store performance, but, as John noted, Scott was like a Toyota chief engineer: he didn’t have authority over the coffee value stream or any step within it.
Unlike previous efforts at the chain to improve the coffee shops, however, Scott did not swoop in and dish out corporate directives. He instead patiently but rigorously developed an “ecosystem of change” that engaged managers and frontline teams in trialing new approaches to improve both the technical and social dimensions of the work. In addition to store teams, a highly capable, cross-functional team at Starbucks HQ was engaged to build understanding and leverage organizational perspectives (lean, product, supply chain, store facilities).
“I came to appreciate the ecosystem that Scott and the company set up for us enabling rapid testing, rapid PDCA,” said Josh, who was a store manager and then joined the Starbucks lean team. Using a lab store within the company, baristas from nearby stores would be brought in to experiment, and up to 20 stores near headquarters also were designated testing stores, allowing for comparisons of different approaches in different stores and outcomes achieved (“parallel set-based experimentation and learning”).
Josh recalled the thoroughness of the experiments and testing and how they were explicit in terms of the dimension teams were focused on. Given the unique culture of each store and the barista/customer relationships within them, it was important that this was not just technical learning (e.g., details of the work, interacting with the equipment) but also social learning (e.g., roles, language, methods to build skills).
John said that Scott understood the social factors, especially the language used to describe how to improve within a Starbucks, and found the right words and phrases for the coffee shop environment and the lives of baristas. For example, Scott talked about “better ways and repeatable routines,” which fit the store culture better than “standardized work.” John added that Scott “found tangible ways to make it real, and embraced the work and the people who do it, building trust and capability. And when people feel invested in, in terms of building capability, they respond to that.”
During this time Scott also was challenged by a corporate executive environment that, as John observed, did not have what is now known as “psychological safety.” As a stock-market-driven company, executives were under pressure to perform in order to keep their jobs. Occasionally John would work with an executive excited about lean ideas on one visit and that person would be gone the next, of which other executives were sure to take note. “There were people walking on eggshells a lot,” said John. “I felt that anyway. So when you would interact with them, they were being cautious, careful, sometimes wanting to keep their head down. But in a situation like that, you kind of don’t want to keep your head down, you want to show off the things that you’re doing. Many of them were in a tough situation most of the time.”
Josh recalled, “The feeling of walking on eggshells around leadership was one that I certainly felt, and I think many people felt. It was sort of keeping your head down, spending as much time as you can with the kind of peers that know you, that you trust, that are familiar with your work.”
Despite this less than favorable executive culture, Scott did not wait for the Starbucks leadership to be totally “bought into lean” before trying anything. Instead, he gained modest alignment to ever-enlarging experiments to learn an determine the effectiveness of lean principles in the Starbucks environment. Ultimately, with the recession of 2008 the Starbucks lean learnings were introduced across the United States (at first) to great effect.
Scott also avoided the No. 1 addressable failure mode of many organizations, said John. Rather than “pursuing lean for lean’s sake” because an executive thinks it is expected and putting in practices they’d merely read about, Scott understood the principles and practices and created a system that was highly situational to Starbucks and was focused on addressing real business problems (quality, waste, barista struggles).
“The experience was all of those things,” said Scott, who acknowledged that many of the lean changes made no longer exist within Starbucks stores; he left the chain in 2011. Interestingly, some of the changes that still persist today involved physical changes such as single-batch drink production with smaller milk pitchers vs. batch production with larger milk pitchers and a batch mindset that had been in place. He notes, however, that many individual baristas developed capabilities that they still value today. He regularly encounters individuals who were baristas during that period and describe it as a “magical time.”
As Scott and John reflected back on this time of co-learning together, they offered insights that other coaching relationships can practically apply.
“Every situation is different,” said Scott. “The coach is different, the coachee is different, the organizational environment, the situation the organization faces, all those things are different. So being mindful of that and intentional about your interactions given those differences.” This perspective was practiced and beneficial, and far different than John walking in and telling Scott what to do as is common in many consulting relationships.
“I think we both recognized, as this podcast illustrated, that there were a lot of things we did not know, individually and collectively,” added Scott. “We needed to figure them out together and that relationship, the coaching relationship specifically, I feel like was more respectful because it recognized that there were unknowns on both parts and the approach was intentionally specific to all of those unknowns in the environment. And that enabled us to do a bunch of things.”
“It’s always instructive to think back on what you’ve learned and how you’ve learned it,” said John. The Starbucks coaching experience confirmed for John some basic principles around how you want to work with someone, which is to never assume that you’ve walked in their shoes until you have — and realizing you never really will — and to respect what they’re going through. “Maybe you’ve seen this technical situation before, but they haven’t.” And recognizing that at one time even the coach had to learn it, too.
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