Thursday, January 29, 2009

Starbucks Economic Leadership

I am have written a little about my coffee habits in the past.

Now, let me note that in the world of coffee, Starbucks is cutting 6,700 jobs and closing 300 stores after reporting first-quarter profits that fell more than expected.

What? A serious economic recession has had a negative impact on a place that sells $4.00 coffees?

Yes, it is true.

But Starbucks being Starbucks, they are teaching by doing.

If crashing economic troubles means fewer jobs for Starbucks employees at their 16,8145 stores in the U.S. and 61 in Australia, then it will not be a burden only shared at the bottom.

And so Starbucks CEO Howard Schultz has asked the board to cut his annual base pay from $1.2 million (last year) to less than $10,000, or the minimum required to maintain benefits for him and his family.


Imagine if the top managers of Ford, Chevrolet, Toyota, Honda and Chrysler did that? Or if the tops managers at Citibank, Wells -Fargo, and Bank of America followed suit?



kathleen said...

I'd certainly like to imagine that. Did you see Maureen Dowd's recent article in NYTimes?

PBurns said...

A nice one.

She writes (see link previously noted to read the whole thing):

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"In an interview with Maria Bartiromo on CNBC, Thain used the specious, contemptible reasoning that other executives use to rationalize why they’re keeping their bonuses as profits are plunging.

“If you don’t pay your best people, you will destroy your franchise” and they’ll go elsewhere, he said.

Hello? They destroyed the franchise. Let’s call their bluff. Let’s see what a great job market it is for the geniuses of capitalism who lost $15 billion in three months and helped usher in socialism.
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