Brian Niccol was the CEO of Chipotle. What will Brian Niccol DO at Starbucks now that he is CEO?
I read the following in Chartr a few minutes ago and was intrigued. He seems like a great manager. So I posted up the following comments into my LinkedIn thread:
The following seems amazing to me, that adding ONE GUY at the top will impact the actual interactions of the people at the bottom. I guess the actual outcomes remain to be seen but here’s the dope from Chartr:
“The $20 billion boss
After its best ever day as a public company, Starbucks added the equivalent value of one of America’s most read newspapers (NYT $9B), the biggest name in jeans (Levi’s $7B), the nation’s largest cinema chain (AMC $2B), with about $3B left in change… all because it announced a burrito chain expert as its new CEO.
Investors seem delighted with the news that Brian Niccol, current CEO at Chipotle and a former exec at Taco Bell and Pizza Hut, will take the reins in September, replacing Laxman Narasimhan who served as CEO for ~16 months.
The 24.5% rise in SBUX’s share price equated to the coffee chain’s market cap. soaring to just shy of $109 billion at the end of yesterday, as people wait to see if “Chipotle’s redeemer” has the Schultzian credentials. But, after such a positive coronation, the new SBUX boss has their work cut out, with the company facing pressure from activist investors, a consumer base that’s getting fed up with price hikes, and a China business that has to run just to stay still.”
I remember the day that Frank Lorenzo resigned as Chair of Continental and there was a huge stock price jump. I looked but I could not find the actual numbers, but he was renowned globally as a highly toxic boss along the lines of Samuel Goldwyn of MGM.
I love that Goldwyn quote, “When I want your opinion, I will give it to you.”
Perfect. What a great guy. NOT, actually from so many reports back in the old days…
I asked Perplexity to dig into this and it is interesting to see how much the engine predicts him to go back to basics in his leadership of that diverse organization. Based on his track record at Chipotle and the many challenges facing Starbucks, he appears likely to implement several key operational improvements:
Focus on Operational Basics – Niccol will likely prioritize getting back to simple operational fundamentals at Starbucks:
- Improve order accuracy and wait times, especially during peak hours
- Enhance labor throughout and efficiency, particularly at high-volume stores
- Simplify work processes for baristas to improve the overall customer experience
Digital and Mobile Enhancements – Given his success with digital initiatives at Chipotle, Niccol may:
- Overhaul and optimize the Starbucks mobile order and pay platform
- Refine the company’s digital growth strategy
- Enhance the Starbucks Rewards loyalty program with more personalization and gamification elements
Menu Innovation and Marketing – Niccol has a history of successful product launches and marketing campaigns:
- Introduce new menu items to drive customer interest and visits
- Develop engaging marketing campaigns to boost brand awareness and traffic
Operational Efficiency
To improve profitability, Niccol may focus on:
- Streamlining operations and reducing complexity
- Implementing cost management strategies
- Optimizing store-level throughput and resource allocation
Brand Positioning – Niccol may aim to:
- Refocus on Starbucks’ premium brand positioning, potentially moving away from discounting strategies
- Emphasize the customer experience and brand differentiation
By implementing these operational kinds of improvements, Niccol should aim to reverse Starbucks’ recent sales declines, improve profitability, and position the company for sustainable long-term growth.
But what about People and Performance, which I see as a long-term fix to many of the problems faced by Starbucks over the past decade?
I asked Perplexity to project some new practices based on his past situation: This output from the engine was enlightening and, if true, maybe a model for some other organizations seriously in need of improvement:
Brian Niccol is known for his people-centric approach to leadership and performance improvement. Here’s how he typically addresses issues around people and performance, employee development and engagement:
Niccol has a strong track record of investing in employee growth and satisfaction: He implemented a program at Chipotle that pays for employees’ college tuition costs at certain schools, demonstrating a commitment to personal development.
At Chipotle, he focused on improving store operations and empowering employees, which likely contributed to better performance and customer experience.
Performance-Driven Culture
Niccol tends to create a culture of high performance and accountability: He’s known for streamlining operations and improving efficiency, which often involves setting clear performance expectations for teams.
His approach typically includes implementing measurable metrics to track and improve performance across the organization.
Teambuilding and Collaboration
While not explicitly known for “team building” initiatives, Niccol’s leadership style often fosters collaboration: At Chipotle, he encouraged cross-functional teamwork to drive innovation in areas like digital ordering and menu development.
His success in launching new products and marketing campaigns suggests an ability to bring teams together effectively.
Employee Benefits and Compensation
Niccol has shown a willingness to invest in employee benefits: The college tuition program at Chipotle is a prime example of his approach to attracting and retaining talent.
He’s likely to review and potentially enhance Starbucks’ existing benefits package to remain competitive in the labor market.
Salary Comparisons
Regarding basic salaries at Chipotle compared to Starbucks: Specific salary data for all positions isn’t readily available in the search results. However, both companies are known to offer competitive wages in the fast-food industry.
Starbucks has historically been recognized for offering better benefits, including health insurance for part-time workers and stock options.
Niccol may look to align Starbucks’ compensation structure more closely with performance metrics, as he did at Chipotle.
In tackling Starbucks’ challenges, Niccol is likely to apply a similar people-focused approach, emphasizing employee development, operational efficiency, and a performance-driven culture to improve overall company results and customer satisfaction.
I found all the above very interesting. And I have hope that he will act in a way to improve the lives of the many Starbucks workers who have been dissatisfied with the way things are.
And, wouldn’t it be nice if these business basics became more common in the organizations of today?
Other Stuff:
Here is a solid article on “old school” leadership about some practical insights into how to align culture with strategy and energize employees today. https://www.strategy-business.com/blog/Leaders-should-revisit-the-works-of-three-corporate-culture-pioneers
Here are the other articles in my What Would… series:
#1 – What would Tom Peters Do –https://performancemanagementcompany.com/2024/07/02/what-would-tom-peters-do/
#2 – What would Peter Drucker Do –https://performancemanagementcompany.com/2024/07/08/what-would-peter-drucker-do/
#3 – What would Frederick Taylor Do –https://performancemanagementcompany.com/2024/07/13/what-would-frederick-taylor-do/
#4 – What would Bob Mager Do –https://performancemanagementcompany.com/2024/07/17/what-would-bob-mager-do-to-improve-organizational-performance/
The Truth is Out There! (so read about it!)
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For the FUN of It!
Dr. Scott Simmerman is a designer of team building games and organization improvement tools.
Managing Partner of Performance Management Company since 1984, he is an experienced presenter and consultant who is trying to retire!! He now lives in Cuenca, Ecuador.
You can reach Scott at scott@squarewheels.com
Learn more about Scott at his LinkedIn site.
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