Starbucks once grew fast. Now I want to grow with discipline--in emerging and developed markets. Emerging markets have a big role to play in powering future growth. So does our transition into a company that excels as a retailer and a purveyor--in supermarkets and other channels--of consumer packaged goods. 
When I returned to Starbucks as CEO in 2008, after eight years, I saw that growth had become a carcinogen. We needed to transform our culture to create healthier growth. In 1987, Starbucks had 11 stores and 100 employees, and a dream to create a national brand around coffee and a unique experience in our stores. That dream become a reality, and had a life of its own. For 15 years, almost everything we did worked. 
Growth becomes seductive and addictive. But growth is not a strategy --it’s a tactic. I’ve learned that growth and success can cover up a lot of mistakes. So now, we seek disciplined, profitable growth for the right reasons. 
In 2008, when I reviewed underperforming stores, I was horrified to learn that the stores that we had to close had been open less than 18 months. Decisions were made without discipline. At times, we made decisions that were complicit with the stock price. There’s a fine line between trying to manage the company in the best fiduciary way--and providing analysts with 100 percent transparency. You don’t want to start making decisions based on a P/E or stock price. 
Most retailers and restaurants report comp-store sales monthly, which produces fluctuation in stock prices monthly. I felt that we had started making decisions that drove incremental revenue but were inconsistent with the equity of the brand. Wanting to remove that albatross, I announced that we would stop reporting monthly comps. I was accused of not being transparent, but I ensured that our people were managing the business for the customer. 
I once walked into a Starbucks, and saw a table of teddy bears in the store. The manager said that it added to her comps, but it made no sense to me. So,  I set a seven-point transformation agenda. We didn’t abandon growth, in fact, one point is to create innovative growth platforms worthy of our coffee. You can’t attract and retain great people when the company isn’t growing. It’s vital to give people hope, to provide aspirations and a vision. 
for the future. My return wasn’t about restoring the company to its original form: we had to instill commitment to grow the company--the right way.
We’ve identified a big opportunity: no company has ever built complementary channels of distribution by integrating the retail footprint and the ubiquitous channels of distribution--such as grocery stores and drug stores. Starbucks can seed and introduce new products and new brands inside our stores. We introduced VIA instant coffee--a $24 billion global market that hasn’t seen any growth in 50 years. If we took VIA and put it into grocery stores and it sat on a shelf, it would have died. But we can integrate VIA into the emotional connection we have with our customers in our stores. We did that for six months and succeeded well beyond expectations. We can draft off of our stores into ubiquitous channels of distribution and then integrate that into the capability and discipline we have around social and digital media. This is now happening. One out of every five transactions in our stores happens off the Starbucks card. Soon, not only will you be rewarded for buying something at a Starbucks store, but buying Starbucks branded products in a grocery store will also give you a reward off your Starbucks card. We’ll integrate the reward system, in a way that hasn’t been done before. 
We see great potential in emerging markets. In India, we’ll soon open stores. In Brazil, we’ve got 50 stores--and a very big upside. We’ll likely be in Vietnam next year. But clearly our number-one growth opportunity is China. In 12 years, we opened 800 stores in greater China, 400 in the mainland. We’ll have thousands. We’re highly profitable there. We started in Shanghai and Beijing, but in the last two years, we’ve opened in cities with five to ten million people. In Fuzhou, people lined up in a rainstorm, waiting for the Starbucks door to open. There are 140 cities in China with over one million people. We don’t have a rollout plan for all of those cities, hut we have the discipline and process to execute a big growth plan in China. 
Every consumer brand imaginable is rushing to China--it’s like the gold rush. We want to be thoughtful and disciplined--not go to too many cities too fast. For us, success in China is first going deep in these markets before we spread to so many cities. It can be seductive; we’ve got to be disciplined. A Chinese real-estate team is working with our people in Seattle. We’ve refined our model for deciding where our stores should be located. And with our recent success in China, we can now map those statistics and metrics in a way that gives us a very good understanding, with greater predictability. 
All of the learning is now being layered onto every international market in terms of how we operate the stores and enhance the customer experience. We’re providing the China team with great resources--our management team and myself go to China to ensure that they have the benefit of all the things that we’ve learned, as well as the benefit of the mistakes that we’ve made. 
We want to put our feet in the shoes of our customers. Not everything from Starbucks in China should be invented in Starbucks in Seattle. The Chinese customer does not want a watered-down Starbucks, but we want to be respectful of the cultural differences and appeal to the Chinese customer. So, the food for the Chinese stores is predominantly designed for the Chinese palate. 
We did not do these things in the past. We were fighting a war here between the people in Seattle who want a blueberry muffin and the people in China who say, “We’d rather have a sesame muffin.” In the past, we thought, “Well change behavior” NOW we think, “We’ll appeal with great respect to local tastes.” So we have a list of core products that appeals to local consumers. We’re trying to create a Starbucks store with deep sensitivity to local relevancy. That’s hard to do when you’re in 55 countries. The reason it’s working is that we’re decentralizing and trusting that the people in the local marketplace know better than the people in Seattle. 
Our biggest growth constraint is attracting world-class people who have values that are aligned with our culture. 
My leadership team hasn’t celebrated much in the last two years, even though we’ve had a lot to celebrate: We’ve more than quadrupled the market value. We had record revenue, record profit. But we look at things that we don’t get right and ensure that the culture is preserved as we grow the company. It’s a discipline of being self-critical, having metrics to study the ROI in stores, in advertising, in new-product introductions--looking at the entry cost of new markets in a different light; looking at the supply chain in a different way. We took $700 million of costs out of operations in the last two years--and we’re still looking for more. 
I take pride in the fact that Starbucks chases the unexpected. Part of my role as CEO is to instill excitement and courage for developing new products. I push people further than they think they can go, yet not further than they can go. 
As I try to reorient our people to think boldly, I also reorient myself to innovate the right way. Big, bold, original ideas can’t be fueled by instinct alone. They need to be relevant to our business, scalable, tested, integrated across channels, and embraced by our partners in Seattle and in our stores. 
The execution of a new idea has to be as good as the idea itself. Taking a more cautious, calculated approach to innovation goes against my just-do-it entrepreneurial nature, which plays off my gut and pushes for speed. But I recognize that the company and I need to shift the way we bring products to market, bringing the same degree of mastery that we apply to roasting coffee. As we explore options for disciplined growth, we ask many questions: How can we improve the store experience? How might we expand our value proposition--emotional and human connection? How can we strengthen our voice to better tell our story? And how can we extend our coffee authority beyond the stores?
I do not like or want to fail, but I’m willing to take risks. As we grow, I want our stores to feel small, balancing efficiency with romance. At the heart of being a merchant is a desire to tell a story by making sensory, emotional connections. LE 
Howard Schultz is CEO of Starbucks (about 17,000 stores) and co-author with Joanne Gordon of Onward: How Starbucks Fought for its Life without Losing Its Soul (Rodale). 

《Leadership Excellence》2012.12
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