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Starbucks’ new boss plans to don the green apron and work with employees at the company’s coffee shops once a month.
In a letter to staff Thursday, Laxman Narasimhan, who officially took the helm of the coffee giant this week, said his “immersive experience” training at dozens of Starbucks stores, manufacturing facilities and support centers over the past six months has helped his understanding of the employee and customer experience to succeed Howard Schultz as CEO. Narasimhan said he plans to continue working at the company’s coffee shops for monthly half-day shifts while he embarks on a mission to “re-found” Starbucks.
It is unusual for CEOs of large companies to regularly work side-by-side with humble employees. A 2018 study by Harvard Business School professors found that CEOs spend an average of 6 percent of their time with front-line employees, compared to 72 percent in meetings.
“CEOs run the risk of operating in a bubble and never seeing the actual world their employees face,” the authors write. “Spending time with the grassroots and with savvy external stakeholders is also an essential way to get reliable information about what’s really going on at the company and in the industry.”
Neil Saunders, chief executive of analytics firm GlobalData, said all retail CEOs should consider spending some time on the “charcoal side of their business.”
“Some are doing this now, many aren’t,” Saunders said. “Interacting with customers, talking to team members and seeing how things work promotes understanding and improves decision-making. It basically helps to ensure that politics is not made from the ivory tower.”
Fighting for the first union contract at Starbucks
Narasimhan will be doing his front-line shifts as Starbucks faces unrest among its workforce as workers unionize at 288 of the company’s 9,000 company-owned stores. On Wednesday, workers at 100 Starbucks cafes staged a walkout, and scores of union baristas rallied in Seattle to make demands that include a statewide starting wage of $20 an hour.
Starbucks declined to respond to a Washington Post question about how much Narasimhan would be paid during his monthly shifts at the store.
The company is fighting allegations of unfair labor practices in Buffalo, where Starbucks’ union efforts first took root. Starbucks demonstrated “a general disregard for the fundamental rights of workers,” National Labor Relations Board Judge Michael A. Rosas wrote in a 220-page order released this month, blaming the company for “egregious and widespread” violations of the law federal labor law accused.
“The most meaningful gesture that incoming CEO Laxman Narasimhan could make to workers is to come to the bargaining table and negotiate with us in good faith,” said Michelle Eisen, a Buffalo Starbucks barista and organizer at the first unionized store the chain in a statement to The Post. “We don’t need leaders to make drinks, we need them to respect our legal right to form a union and have a real voice in this company.”
In Thursday’s letter, Narasimhan said the company must work to improve the experience for employees, “including long-term hiring and retention and continuing our investments in partner wages and business operations.”
Starbucks Workers United, which represents more than 7,500 employees in hundreds of stores, said the group hopes Narasimhan’s commitment to regularly spending time with front-line workers is “a sign that he’s ready to start the relationship of Changing Starbucks to workers and charting a new path forward with our union.”
According to Anthony Nyberg, a professor of management at the University of South Carolina and a researcher at the Academy of Management, what employees expect from their managers has changed over the past few decades.
While it was typical for leaders in the 1980s and 1990s to remain distant and adopt a more “despotic” approach to leadership, “there’s pretty good evidence now that we want our leaders to be more authentic and approachable,” Nyberg said.
It’s probably no coincidence that Narasimhan committed to working with employees at a time when there’s been “turmoil and strife” in the front lines of the Starbucks workforce, Nyberg said. It’s especially important for leaders new to organizations to show a willingness to listen and understand how a company works before making any changes, he said.
“That sends a pretty strong signal to everyone that he cares enough to engage with the people who are actually doing all the hard work,” Nyberg said.