From the Ground Up
Insider account: later memoir on social responsibility and politics.
Summary
Schultz's second memoir covers his return as Starbucks chief executive in 2008, the company's recovery, and the social and political initiatives he pursued, written as he was considering a presidential run.
The business content covers the 2008 crisis: Starbucks had over-expanded, same-store sales were falling, the customer experience had deteriorated, and the share price had collapsed. His response included closing hundreds of stores, closing every American store simultaneously for a training session on espresso preparation, cancelling growth targets, changing the store equipment back to machines that required staff to make drinks manually, and telling investors the recovery would take years.
The larger part of the book concerns initiatives Schultz pursued as chief executive: the health insurance for part-time workers he had introduced earlier and defended; the college tuition programme with Arizona State University; hiring commitments for veterans and for young people not in work or education; store openings in underinvested neighbourhoods; and the Race Together campaign, which asked baristas to discuss race with customers and which was withdrawn after a week following widespread criticism.
Schultz's argument throughout is that a company should take positions on social questions because its employees and customers expect it. The book is written for a political audience as much as a business one, and the self-presentation reflects that. It is thinner on operations than his first book and does not seriously examine the failures, including Race Together, or the unionisation campaigns that followed his tenure.
Key takeaways 7
- Starbucks' 2008 decline was caused by over-expansion and a degraded customer experience rather than by the recession alone.
- Closing every American store simultaneously for a training session imposed a visible cost that signalled the seriousness of the reset internally and externally.
- Reversing an efficiency decision, in this case returning to equipment requiring manual preparation, can be necessary when the efficiency removed what customers were buying.
- Telling investors a recovery would take years, rather than promising quarterly improvement, is what allowed the decisions the recovery required.
- Growth targets should be withdrawn during a turnaround, because they force store openings that worsen the problem being fixed.
- Employee benefits including health insurance and tuition were defended as commercial decisions about retention rather than as generosity.
- The Race Together campaign was withdrawn within a week, which demonstrates the limits of corporate participation in social questions the company has no standing in.
Who should read it
Operators interested in a retail turnaround that reversed prior efficiency decisions, read with awareness of the book's political framing.
About Howard Schultz
Former chief executive and chairman of Starbucks, which he grew from a small Seattle retailer into a global chain.
Pour Your Heart Into It and From the Ground Up describe how a service format was standardised across thousands of locations while the company paid for health coverage and equity for hourly staff, and what that cost. Onward records the 2008 turnaround - closing stores, retraining baristas, cutting a growth plan the founder had approved - and is the more useful account for anyone operating under pressure.
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