Those companies that are not bold in the face of the global economic crisis and don’t have the courage to take risks, may be left behind, according to Starbucks chairman, president and chief executive Howard Schultz.
Speaking at the 12th European Foodservice Summit in Zurich, Schultz said that, more than ever, companies “must have the curiosity to see around corners and have the courage to take risks”.
Talking about operating in the current unstable financial environment, he said: “The status quo of how we operate in the past is on a collision course with time and how we operate in the future. I believe those who understand their environment and take the road less travelled will win and endure.
Schultz, who returned as chief executive of Starbucks in 2008, said that every company would need to be more creative and more entrepreneurial to cope with the major challenges facing economies. “Great companies pick up market share in downturns, great entrepreneurs come forward and new businesses are born.”
Schultz said that with trust in traditional institutions, such as governments, at its lowest ever level, people were hungry for leadership, which has got to be “consistently honest”.
He recently launch a campaign to urge chief executives to boycott donating to US political campaigns to encourage leaders to solve the nation’s growing budget deficit. Over 60 business leaders have already signed up to the pledge.
He said: “I am asking that we forego political contributions until the country’s leaders deliver a fiscally disciplined long-term debt and deficit plan to the American people. Our leaders need to lead, business leaders shouldn’t be quiet, politicians work for us, people need to be represented.”
And he added that communicating a company’s strategy with its staff/people was crucial. “There should be transparent, honest and frequent communication with your people, there needs to be a common vision and your people need to see themselves as part of that vision, you need to bring them along.
“Our competitive advantage is our relationship with our people. Long-term value for your shareholders is directly linked to creating long-term value for your people.”
Schultz said that companies cannot escape what is going on in the world.
He said: “We should recognise that we have a collective responsibility to invest in communities we serve. Companies need to demonstrate a positive signal to their communities that we can work together. Workers need respect for their company and they need to see that it is investing in the local community. Manage our organisations and brands, think about our responsibilities to the communities we serve.”
• This article first appeared on M&C Report, a WRBM publication that offers business and intelligence in the eating and drinking out markets. For more information visit www.wr-bi.co.uk.