Where’s the magic in burnt cheese?

According to the UK Government’s department of Business Innovation and Skills (BIS) there are almost 1m private sector enterprises in Britain which employ between 1 and 9 people, so called micro businesses. The founders of these businesses are entrepreneurs, are they not? They have established a business, attracted paying customers, employ people and are dedicated to the cause.

In 1983 a projects boy from Brooklyn, New York visited a small espresso bar in Milan and became hooked on the world of coffee. So much so that he gave up his marketing job and started his own coffee bar, Il Giornale, back home. He had two employees, little money and a personal guarantee for the store lease around his neck. Just another micro business entrepreneur?

Maybe not. This one writes a memo to the small team describing his passion and conviction, the opening line of which reads: “Il Giornale will strive to be the best coffee bar company on earth.” 28 years later this particular coffee company is made up of thousands of stores in 54 countries serving 60m customers every week with,what they believe to be, the best cup of coffee anywhere. The company, as you’ve probably guessed is Starbucks and the Brooklyn boy is Howard Schultz, its current CEO. The question that interests me is what is it about Howard Schultz that sets him apart from thousands of other micro business entrepreneurs who, on the whole, remain in the micro climate?

In his recent book, Onward, Howard tells the story of the survival of Starbucks during the financial crisis of the last decade. It’s a compelling read. He sees Starbucks differently from you and me, who no doubt are customers from time to time. The lens he looks through, even now, despite the fact this is a $10bn corporation, is multi sensory. It’s about crafting one outstanding cup of coffee a million times not producing a million cups of coffee. It’s about aromas, ambiance, community, emotion, craftsmanship, precision, flavours and passion. In one word, theatre.

If you are reading this as a micro business entrepreneur you may be thinking it’s fine for Howard Schultz, he’s fantastically wealthy and can do whatever he wants. That may be true, but for part of his Starbucks career he was just like you. The boss of his own store with a passion to build something bigger than that, the zeal of the evangelist. His employee memo continued: “our coffee bars will change the way people perceive the beverage.”

At a retreat in 2007 Howard and the senior management team were grappling with the problems of growth and declining financial performance. Howard’s plea to get back to basics was going unheard amidst the organisational noise of opening 6 stores a day. The different perspectives of the entrepreneur and the corporate team were brought into focus when he complained that all he could smell when he went into a store were badly grilled breakfast sandwiches; not the rich, seductive aroma of coffee. “Where’s the magic in burnt cheese. Get the sandwiches out!”

Here’s my take on the what might distinguish a “Howard” from the typical micro business entrepreneur.

1. Ambition. Howards want to build something significant and substantial. They have ambition and vision, a desire to grow. You have to really want this to go through the pain of growing from a single outlet to almost 20,000 stores worldwide.

2. Opportunistic. In 1983 there was no such thing as a national coffee chain but the UK is now a £5bn coffee shop market with Starbucks, Costa Coffee (Whitbread plc) and Caffè Nero dominating the market. Howards see these opportunities and are prepared to take them. Bound up in both these characteristics is a willingness to take a risk.

3. Energy. Howards are driven to succeed, to pick themselves up when they fall at obstacles. They can be restless, difficult to work with or manage and you often have to run to keep up with them.

4. Self-belief. Howards keep going when everyone else says it’s not possible. They are intuitive and often rely on gut instinct rather than analysis.

5. Inquisitive. Howards are always looking for ideas and ways to improve the product or service offering. Once they have got hold of an idea they often find it difficult to shake off.

You can probably add a few more characteristics from your own observations and experience. Why not share your thoughts in the comments?

Let’s leave the last word with Howard Schultz who, when asked what motivated him to return as CEO when he didn’t really need to, said quite simply, “I love this company”

Reading the book I can feel that love. More importantly, can your customers and colleagues feel the love you have for your company?


About This Week in Business

I'm CEO @YesGrowth a leading AltFin company which provides syndicated, short term working capital to UK businesses in any sector. Connect with me on LinkedIn or Google+ and follow me on Twitter.
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One Response to Where’s the magic in burnt cheese?

  1. Vennie Vetri says:

    Everyone loves to read other peoples success stories. It provides us with evidence that amazing things do happen to normal people. By learning what they did to succeed we come one step closer to success ourselves. Such is the case with the ten stories told in Net Entrepreneurs Only – 10 Entrepreneurs Tell the Stories of their Success by Gregory K. Ericksen and Ernst & Young.:

    Very latest posting from our new blog site

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