By January 11, 2008 1 Comments Read More →

A Peek, Of Sorts, Into Starbucks’ Operations

Starbucks Gossip Blog – Open Thread

Starbucks Replaces CEO with Chairman

I’ve posted about Starbucks before – I believe they have people at headquarters learning about and starting with Lean, but I don’t know any details (any Starbucks employees reading this, feel free to chime in). This WSJ article from 2005 is still pretty fascinating, on their attempts at operational improvement that seemed very expert driven (not the Lean approach that would rely more on the associates).

I’m a pretty frequent Starbucks (SBUX) customer (grande drip) and I’m always sort of curious about the opportunities for Standardized Work and kaizen (continuous improvement) for a company with 15,000 points of customer contact. The traditional McDonald’s approach to standard processes has been consistency and “dumbing it down.” I’ve read about Starbucks complaining about their operations being similarly “dumbed down” (such as the automated espresso machines that were put in a few years back).

It always seemed that Starbucks had an opportunity to engage its associates in real kaizen… if one associate in one store has a great idea, are there mechanisms for sharing that idea across the other 14,999 stores? Does all communication go up through Seattle and then back out? It’s an interesting process to think about.

One of the non-Lean blogs I follow is Starbucks Gossip (main page). I saved this post’s first link back in November and hadn’t gotten around to posting about it. But, Starbucks was in the news, as their CEO was fired, the founder/Chairman took that job back, and McDonald’s is creeping into SBUX territory with espresso cafes. That’s not what I’m here to write about.

The thing that struck me in the linked post is the operational details that employees, talk and (sometimes) bitch about. You can see Lean-type issues, management issues, quality discussions, and opportunities for improvement. I can’t link to particular comments, but I’ll list them by time and you can search if you want:

  • 8:57:04 AM: Discussion of layout differences in stores and how that impacts productivity, how managers help during busy times (labor/volume flexibility)
  • 9:41:56 AM: Comment about managers forcing them to push certain drinks making “veiled threats on our jobs if we don’t meet our goals” (not very lean)
  • 8:02:52 PM: Comment on running out of peppermint syrup (a supply chain issue) and managers “had us buy another brand’s syrup and put it in the Starbucks labeled bottles” (a workaround)
  • 11:19:15 AM: Complaint about a manager “micromanaging obsessively and making veiled threats about my job…”
  • 12:14:44 PM: Discussion of planned upgrades / maintenance to espresso machines, how long that should take (standardized work)
  • 8:26:30 PM: Incorrect drinks being made (quality problems and defects)
  • 8:34:17 PM: A few posts about customer requirements vs. safety (people ask for drinks hotter than the allowed temperatures) — different associates react differently (std work)
  • 10:44:08 AM: Questions and discussion (many posts) about the proper standards for “remaking” a drink (std work, quality, and cost)
  • 11:50:26 AM: Lots of stockouts (inventory)
  • 2:19:27 PM: Mention of a “Business Resource Manual” (sounds like SOPs), they also have a “portal” (assuming a website for info)
  • 8:03:23 AM: Stores with “emergency peppermint storage for your district” (safety stock, inventory)

Anyway, I think it’s always interesting to hear directly from employees. In a company that big, it’s natural there will be problems and complainers, so I know to take some of this with a grain of salt. But, if you get past the whining, there’s a real treasure-trove of operational, quality, management, and customer service issues to work on. I wonder if the founder/CEO will be able to help?

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Mark Graban's passion is creating a better, safer, more cost effective healthcare system for patients and better workplaces for all. Mark is a consultant, author, and speaker in the "Lean healthcare" methodology. He is author of the Shingo Award-winning books Lean Hospitals and Healthcare Kaizen, as well as The Executive Guide to Healthcare Kaizen. His most recent project is an eBook titled Practicing Lean that benefits the Louise H. Batz Patient Safety Foundation, where Mark is a board member. Mark is also the VP of Improvement & Innovation Services for the technology company KaiNexus.

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1 Comment on "A Peek, Of Sorts, Into Starbucks’ Operations"

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  1. passthebuck says:

    I applied for a Lean position at the Seattle HQ and they pulled it prior to interviews back around October of last year. I wonder if they are ramping up to get Lean now.

    I used to work at a retail location for them for a year and a half. I agrewe there are a lot of opportiunities for Lean to make them succeed.

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