April 2, 2008

I have to admit I’ve been a longtime fan of Starbucks. Not so much of their coffee, but of their founder, Howard Schultz. As a man who is driven by something far greater than financial success, he returned to his role as CEO at the beginning of this year amidst concern that the world’s largest purveyor of gourmet coffee had lost some of its focus. You may recall hearing the news that Starbucks locations in the US, all 11,100 of them, closed one afternoon in February for a 3-hour training session involving 150,000 workers. Some might view this as a big hit to revenue, but I’m betting that Schultz didn’t. He sensed the need to take action and counter the first-ever drop in customer transactions they saw in the most recent fiscal quarter.

Schultz made some major commitments, declaring in a recent USA Today interview that “there will be a fundamental change in the taste and experience of going to Starbucks.” These changes include a return to grinding coffee in each store and a much-improved loyalty rewards program with social networking. He’s promising innovation that will bring back his core customers that have left for other coffee grounds, no pun intended.

What I admire foremost about this leader is the fact that he’s taking responsibility for the problems at hand rather than conveniently blaming the economy or some other factor. With all the current bad news around housing, energy prices, stock market volatility, and so on, it’s easy for anyone running a business to get down in their outlook. But instead of pointing the finger, Schultz is taking the bull by the horns, forcing his company to look in the mirror to solve problems that are “self-induced.” I find this incredibly refreshing.

Consider your business: If your revenues are down, are you pointing the finger or are you looking in the mirror? In this turbulent economy, there’s probably never been a better time to get back to basics. Revisit the critical question, “what business am I in?” Schultz believes that he’s in the “people business” rather than the coffee business.

Consider your core customers: Why do they choose to come to you? Have you explored, like Schultz, what it will take to enhance their experience?
Finally, consider your level of innovation: The tendency is to view this in terms of new products or services, which comprise the “what” and “how” of your business. Perhaps it’s time to think about innovating the “when”, “where”, and “why” of your business. I suspect that a good bit of the employee training going on at Starbucks is focused on reviving the dramatic structure (“coffee theater”) that helped create the Starbucks experience in the first place.

Chicago and ASCRS

A heads-up for Chicago: For those of you going to ASCRS in Chicago and in need of some “back to basics” inspiration, here are three events you may want to check out:

AMAZEMENT – Legendary inspirational speaker (and world-class magician) Giovanni Livera will be keynoting the AMO University session on Friday morning (4/4) at the Hilton at 8 am. He will talk about how to astonish your customers in a lecture called Anything is Possible.

PASSION – The ASOA breakfast on Saturday morning will feature Gary Zelesky, who will talk about bringing passion to your practice and your patients. Co-sponsored by AMO and Care Credit, this event takes place at 7 am at McCormick Convention Center in room W-375C.

HUMOR – The Pretty Late Show with host Mike Carbone comes to the Art Institute of Chicago on Sunday evening at 5:30 pm. In this live studio event, presented by EyeWorld magazine, talk show host Mike Carbone will interview leading surgeons on what they’re currently doing to create a premium patient experience in their practices. Should be a hoot!

 

Shareef Mahdavi
President, SM2 Consulting

 
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