June 23, 2008

By Roey Gilberg

UCLA Anderson presented the first inaugural John Wooden Global Leadership Award to Howard Schultz, chairman, president and CEO of Starbucks, on Wednesday, May 28. Although he formally received the award at a dinner ceremony, Schultz treated Anderson students to an hour-long afternoon lecture followed by a question-and-answer session.

He was introduced by UCLA Anderson Dean Judy D. Olian. “There is no better honoree than Howard Schultz,” she said of the award’s first recipient.

After becoming the first member of his family to graduate college, Schultz eventually joined Starbucks as director of marketing in 1982.  During a trip to Italy, he observed that coffee was an experience in itself, and cafe’s were an integral part of society.  Schultz envisioned bringing that same European cafe atmosphere back to America, where coffee was nothing more than a beverage. Years later, he was at Anderson relating this tale and many more to an eager audience.
“Starbucks brought people together,” he said.  “There was a sense of gathering ... this human interaction built the brand.”
Throughout the talk he stressed the importance of maintaining the core values of the company, and what the brand has meant to everyone involved.  “There was an emotional attachment that we were building, both with our customers and our people,” he said.
However, he noted the difficulties inherent in trying to preserve company values against rapid growth.  “How do you get this big, and stay small?” he asked. He went on to emphasize the need for companies to have a social conscience, when it comes to both treatment of its own people as well as the community in general. “Corporate social responsibility has to be an integrative part of the company,” he said.
As example, he pointed out that shareholders were initially very concerned when Starbucks began offering comprehensive health care coverage to its employees, but the company went ahead anyway.
He also discussed the state of the economy today, and what it means for Starbucks.  He noted various negative markers, such as the decrease in mall traffic and the rise in home foreclosures.  “This is a humbling time, and a real character test,” he said.  “The real challenge today for us is believing and having faith in the guiding principles of the company.”
Schultz underscored the importance of not letting success lead to passivity.  Pointing to his own company as an illustration, he explained why he returned to Starbucks in January after having resigned in 2000.
“I feel that we were drifting a little bit toward mediocrity,” he said.  “Success is not an entitlement -- you have to earn it.”
At the conclusion of his remarks, the floor was opened to both Olian and the audience for questions.  Schultz, now wearing an Anderson sweatshirt given to him on stage by Olian, responded to various inquiries about his own journey and that of his company, and made sure to leave listeners with some personal advice as well.
“Follow your dreams,” he urged.  “Then dream bigger.”

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