Alan's corner: How to adopt a long-term perspective when building your legacy
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Alan’s corner: How to adopt a long-term perspective when building your legacy

Alan’s corner: How to adopt a long-term perspective when building your legacy

Markets evolve, as do customers, creating the need for an organisation to continuously adapt

With a brand recognition probably as strong as McDonald’s, Starbucks is the largest coffee chain in the world. With 32,000 locations and around 350,000 employees, it has a very unique brand that is consistent in all jurisdictions.

It has had its ups and downs in recent times, with the company recovering from an alleged racism issue in a Philadelphia store in 2018, that got worldwide attention. Its response was swift and effective, with mandatory training for all staff around the world.

The chain was founded in 1971 in the Pike Place Market in Seattle, which is also known for its famous fish market. Howard Schultz joined the company in 1982 and introduced coffee culture to the American market to great success for the brand. He stepped down as CEO in 2000, but then returned to the same role in 2008.

He had to rescue its reputation for declining customer experience and poor treatment of employees. His aim was to ‘reignite the emotional attachment with customers’ and return to the mantra of Starbucks being the “3rd Place” for customers. He eventually stepped down again in 2016.

Kevin Johnson the CEO since 2017 let abruptly on April 4 this year and Howard has once again returned to the role. The reason is that the ship needed steadying after much employee unrest and their engagement with unions for the first time. It must have felt like déjà vu for him and the entire organisation.

Clearly Schultz is a great leader, at least that’s what Wall Street and Main Street think. But I wonder has he missed a trick in ensuring continuity beyond his own tenure? The brand imagery is strong and the service proposition is consistent across the globe. But why did employee/employer relations deteriorate on at least two occasions? And how did it happen that Schultz had to announce at a recent staff meeting that he wasn’t ‘anti-union’ but ‘pro-Starbucks’?

How to build your legacy 
This for me, raises the issue of what it takes for great leaders to shape a great legacy. For most founders of SMEs that I meet, their ambition for their company is often altruistic. Yes of course they want to build value and optimise return on investment. But many of them are so concerned about the future of the company that they find it difficult to hand over the reins.

Nevertheless, they do eventually, tending to concentrate mostly on the business strategy, the system and of course the financials. Only some really consider leadership succession and fewer still, consider culture.

But what about culture? After all, culture is the golden thread that binds an organisation together. It’s the foundation that underlies all decisions, strategies, investment, and more. Leaders won’t be around forever. Markets will evolve, as will customers and the need therefore for an organisation to continuously adapt. As the world continues to change at an alarming pace and complexity, the one element of a business that enables it to cope, is culture.

Here are some tips for refreshing your culture:

In preparing your legacy, conduct an audit of your current culture. Do that with a carefully structured survey and series of focus groups. Make sure the audit is objective and authentic. Decide which bits are good and will take the business forward.

Design a new culture built on a set of values. After all, culture is all about behaviours, rituals and beliefs. Values are that framework on which a defined and lasting culture is built. Be careful though, as organisations often get this wrong. They list a set of commonly used words or phrases that nobody really believes in, never mind being able to articulate.

Google is not a good resource for this important exercise. They need to be your values, carefully tailored in line with your heritage and your ability to utilise them. They should be authentic and measurable.

Ensure you have a robust plan to embed them for the long term. They must be embraced by all and everyone should be made accountable for their own role in living them

The last word 
On his return, Schultz said: “Although I did not plan to return to Starbucks, I know the company must transform once again to meet a new
and exciting future where all of our stakeholders mutually flourish.” I’m pleased to hear that he has also acknowledged that stakeholders are different in 2022.

Schultz obviously cares about the employees and it seems that they trust him too. But if I was fortunate enough to have a chat with him over a coffee, I’d encourage him to carve out a clearly defined culture, making all leaders accountable for it. But as you know, culture change is not easy.

Even Wall Street is so far underwhelmed and not giving Schultz any ‘prodigal son’ accolades yet. But that doesn’t mean culture shouldn’t be worked on. It’s quite the opposite in fact. A well-designed and embedded culture will not and should not change frequently. Excuse me now, while I go and make a long-distance call.

Alan O’Neill is an author, keynote speaker and owner of Kara, specialists in culture and strategy

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