Wednesday, July 2, 2008

Starbucks, Corporate Growth Gone Bad

I had a good conversation this morning with a CEO of an emerging software company about managed growth. We agreed that while growth is critical for the health of any company, many executives become too enamored with it.

Starbucks is a good example of growth gone badly. They announced yesterday plans to close 600 underperforming stores across the US at a cost of nearly $350M. More surprising is the fact that nearly 70 percent of these stores have been open for less than two years.

According to Starbucks CEO Howard Schultz this decision will allow the company to focus on “enhancing operational efficiency” and “improving customer satisfaction.” OK…does that mean they are an inefficient company that has lost sight of its most important audience – customers?

At Strategic Communications Group (Strategic), our corporate philosophy is “great work for great clients.” We keep our focus on this principle with the belief that our own growth as a business will result from the ability to deliver on that promise.

At times, we have made decisions that tempered our ability to grow. We’re willing to accept that fate as we strive to always keep the interests of our clients and employees top of mind.

Starbucks to Shutter 600 Stores

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