Comments on: Can the Starbucks experience scale? http://www.adaptivepath.com/blog/2007/02/28/can-the-starbucks-experience-scale/ Adaptive Path Blog Fri, 21 Nov 2008 02:16:36 +0000 http://wordpress.org/?v=2.6.3 By: adaptive path » blog » blog archive » More on scaling the Starbucks experience… http://www.adaptivepath.com/blog/2007/02/28/can-the-starbucks-experience-scale/#comment-52903 adaptive path » blog » blog archive » More on scaling the Starbucks experience… Mon, 05 Mar 2007 00:43:55 +0000 http://www.adaptivepath.com/blog/2007/02/28/can-the-starbucks-experience-scale/#comment-52903 [...] We wrote about it last week, and today the Los Angeles Times offers a thoughtful opinion on “Starbucks’ ‘venti’ problem”. [...] [...] We wrote about it last week, and today the Los Angeles Times offers a thoughtful opinion on “Starbucks’ ‘venti’ problem”. [...]

]]> By: The Anti-Marketer http://www.adaptivepath.com/blog/2007/02/28/can-the-starbucks-experience-scale/#comment-52724 The Anti-Marketer Sun, 04 Mar 2007 13:45:58 +0000 http://www.adaptivepath.com/blog/2007/02/28/can-the-starbucks-experience-scale/#comment-52724 <strong>Starbucks: Ripe for disruption, or already disrupted?</strong> I suspect most people have heard by now of the kerfuffle about an internal memo, leaked through a popular Starbucks fan blogsite and ultimately covered by BusinessWeek, The Wall Street Journal, Forbes, CNN, etc., which was penned by the founder Starbucks: Ripe for disruption, or already disrupted?

I suspect most people have heard by now of the kerfuffle about an internal memo, leaked through a popular Starbucks fan blogsite and ultimately covered by BusinessWeek, The Wall Street Journal, Forbes, CNN, etc., which was penned by the founder

]]> By: Brandon Schauer http://www.adaptivepath.com/blog/2007/02/28/can-the-starbucks-experience-scale/#comment-51772 Brandon Schauer Thu, 01 Mar 2007 21:50:16 +0000 http://www.adaptivepath.com/blog/2007/02/28/can-the-starbucks-experience-scale/#comment-51772 @Travis: You bring up some great points. I think the problems cited in the memo are more surface issues that are impacted by the underlying scaling issues, such as the shortage of coffee-fanatic workers that you mention. But while automatic espresso machines and new-construction stores aren't immediate tied to the scaling issue, they are very much the result of sacrifices made due to other decisions made in scaling the business. I think one lesson is to be clear about what the scarcity/point-of-tension is when scaling. It's not manual espresso machines, it's coffee-fanatic workers. It's not a lack of old-construction buildings, its the capability to quickly source, purchase/lease, and customize existing structures. @Travis: You bring up some great points. I think the problems cited in the memo are more surface issues that are impacted by the underlying scaling issues, such as the shortage of coffee-fanatic workers that you mention.

But while automatic espresso machines and new-construction stores aren’t immediate tied to the scaling issue, they are very much the result of sacrifices made due to other decisions made in scaling the business. I think one lesson is to be clear about what the scarcity/point-of-tension is when scaling. It’s not manual espresso machines, it’s coffee-fanatic workers. It’s not a lack of old-construction buildings, its the capability to quickly source, purchase/lease, and customize existing structures.

]]> By: Travis http://www.adaptivepath.com/blog/2007/02/28/can-the-starbucks-experience-scale/#comment-51385 Travis Wed, 28 Feb 2007 22:19:41 +0000 http://www.adaptivepath.com/blog/2007/02/28/can-the-starbucks-experience-scale/#comment-51385 As I mentioned to Peter, who first showed me the memo, it blames growth for quality decline, but then only cites reasons that have nothing to do with growth. All those optimizations and changes Howard Schultz mentioned could just have easily been done by a single local store. They're all factors the store has control over. They could switch back to their old short slow espresso machines, and they could start grinding coffee in the store again. That's not a scaling problem and they ought to know it. An example of a scaling problem is that the people running each store don't know enough about making coffee, and aren't fanatic enough to learn -- because there aren't enough people like that to staff 13,000 stores. The comments on starbucksgossip.com were pretty quick to hit on that problem, but the memo wasn't. My vote is that the memo is authentic. Starbucks at least confirmed it to Reuters (on MSN, AOL, WSJ) but more importantly, have you ever heard a CEO talk? CEOs talk like that. A couple of grammatical errors, a lot of cheerleading around solvable problems, and some good old fashioned misdirection. As I mentioned to Peter, who first showed me the memo, it blames growth for quality decline, but then only cites reasons that have nothing to do with growth. All those optimizations and changes Howard Schultz mentioned could just have easily been done by a single local store. They’re all factors the store has control over. They could switch back to their old short slow espresso machines, and they could start grinding coffee in the store again. That’s not a scaling problem and they ought to know it.

An example of a scaling problem is that the people running each store don’t know enough about making coffee, and aren’t fanatic enough to learn — because there aren’t enough people like that to staff 13,000 stores. The comments on starbucksgossip.com were pretty quick to hit on that problem, but the memo wasn’t.

My vote is that the memo is authentic. Starbucks at least confirmed it to Reuters (on MSN, AOL, WSJ) but more importantly, have you ever heard a CEO talk? CEOs talk like that. A couple of grammatical errors, a lot of cheerleading around solvable problems, and some good old fashioned misdirection.

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