Starbucks has announced that former CEO Kevin Johnson will retire and founder Schutz will take over as interim CEO. This is Schutz’s third time running the company.

From 1986 to the present 36 years, Starbucks has served as CEO for 23 years, and the other three have a combined term of only 13 years. This time Starbucks brought Schultz back, and Fortune quipped: “Is there anyone else who can run this company?”

In fact, Johnson stated as early as a year ago that he would retire. This year, Starbucks did not seek anyone else, and found the old face Schutz. Jeffrey Sonnenfeld, senior associate dean of the Yale School of Management, told Forbes that if Johnson had announced a year ago that he was retiring, “why is there nothing on the Starbucks board this year?” Do, but just invite a retiree to come out of the arena?”

The board might justify this: Judging by his past track record, Schutz has good reasons for taking the blame. Schutz is a major contributor to the introduction of cafe culture into the United States and abroad. Under his leadership, Starbucks expanded from just 11 stores to more than 28,000 stores in nearly 80 markets. If someone invested $10,000 in Starbucks stock when it first went public in 1992, it would be worth more than $3 million today, according to Fast Company data in March. It’s all thanks to the foundation that Schutz laid.

Lost three generals in a row, trade unions rise
He has become the safest choice for internal and external troubles
With such a record, when the company was in turmoil, the first firefighter the board thought of was naturally him. In the 2008 financial tsunami, Starbucks brought back Schultz, who had been in office for 8 years, as CEO. In January this year, the chief operating officer and chief financial officer of Starbucks resigned one after another. In April, the CEO changed again, losing 3 generals in a short period of time. In addition, the epidemic has hit the Chinese market and the cost has risen. Since this year, Starbucks’ stock price has lagged behind its competitors. This has become a safe choice for internal and external troubles.

“When you love something, you have a strong sense of responsibility to help when called upon,” Starbucks said in a statement. ”

At present, the most urgent problem for Starbucks is the union, and many employees of its American stores have expressed their desire to establish a union. The unionization movement has spread to more than 100 stores in 27 states. “Fortune” believes that the current labor union movement is surging, the new generation of consumers are demanding that companies respect labor rights, and investors are beginning to not only care about financial performance, but also pay attention to the company’s position on other social issues, “The (Starbucks) board of directors must decide whether the company is It’s not that you can afford to anger laborers.”

From this perspective, it may explain why Schutz is the right person at this time. In the past under his management, Starbucks has been hailed as one of the best companies for people to work for. An employee of a Starbucks store in New York, USA told The Wall Street Journal: “Schultz is more concerned with what Starbucks calls ‘people-to-people connections.'” As for other managers other than him, they showed “too much focus on performance metrics.” and operational efficiency.”

Schutz’s “people-oriented” style is deeply imprinted on Starbucks. According to Harvard Business Review, the company has cultivated a relationship-driven, employee-first approach over the years, “Starbucks calls employees ‘partners’, not ’employees’, and even part-timers (in the U.S.) Stock options and health care,” said Credit Suisse analyst Lauren Silberman. “Schutz is a ‘do-it-yourselfer’ guy — as soon as he walks into the store, people can feel the enthusiasm.” Bo News said he was “fascinated by details”.

This kind of charm and enthusiasm may be helping to ease the pressure of public opinion. On March 15 this year, U.S. Labor Commission prosecutors accused Starbucks of spying on and retaliating against union supporters, which Starbucks denies. Part of the reason the board invited Schutz to come forward was to rely on his prestige to quell the controversy. Melody Hobson, chairman of the company’s independent board, called Schultz “MVP (Most Valuable Player)” and “the perfect carrier of company culture” after he appointed him.

Although Schutz is currently taking the blame in the name of interim CEO, many people believe that the word interim will be removed sooner or later. Analyst Peter Saleh doesn’t see Schutz’s tenure as a temporary one. “I think it’s going to be more of a permanent job.” While Starbucks said it would name a new CEO this fall, Peng said Bonews.com said he took the helm this time and “may last beyond 2022.”

But the key to deciding whether Schutz is interim or permanent chief executive is still realistic performance. According to a study by the University of North Carolina School of Business, the stock price performance after the CEO returned to the pot was about 10% worse than when he first took office. Charles Elson, director of the Center for Corporate Governance at the University of Delaware, dismissed Schutz’s response: “Two returns are unusual,” he said. “Cats have nine lives, but CEOs don’t. ”

Starbucks has been operating for nearly 36 years, and Schultz has been in charge for 23 years!
(Time: CEO)
1986-2000: Schutz
2000-2005: Orin Smith
2005-2008: Jim Donald
2008-2017: Schutz
2017-April 2022: Kevin Johnson
April 2022～: Schutz

On the surface, the founder’s record is outstanding, and asking him to come out can solve the urgent need. But looking for the same person for rescue over and over again will also develop a company’s dependence on the company, which can easily cause moral hazard to the management team: even if it is not done well, the founder will still collect the mess.

Jason Schloetzer, a professor at Georgetown University’s business school who studies CEO succession, told Forbes that a second or third recall of a former CEO will affect future CEO hiring. “When you build a culture in the management team where the founders are always around and still actively involved, it’s very difficult for the company to recruit people who ‘want to go their own way’.”

At the same time, CEOs who return to the pot—especially the type of executive who was so successful in Schutz’s second tenure—may continue to do the things that made him successful in the past, while ignoring important issues such as employee mentality, public expectations, and so on. The environment may not be what it used to be.

Compared with Schutz’s “retirement”, another well-known company, FedEx, its founder, Fred Smith, announced his retirement in March this year and handed over the CEO to Raj Subramaniam, an internal employee of the company. . “I am very pleased that a leader like Subrani can lead FedEx into a very successful future,” Smith said in a retirement statement.

There is no absolute right or wrong between Smith’s handover and Schutz’s return, but the implications are thought-provoking: When should entrepreneurs let go?

No matter how powerful an entrepreneur is, one day they will have to pass the baton. The next generation has the unfamiliarity and naivety of the next generation, but only by letting them face the crisis can they learn to grow, and finally take care of themselves, just like parents should let their children face the problems themselves. If the child has a problem, the parents will come forward to solve it. This kind of “helicopter parent” is good for the child on the surface, but the price is that the child loses the opportunity to grow up.

Five years ago, at an exciting annual shareholders meeting, Schutz handed over the keys to the earliest Starbucks store to the then incoming CEO Johnson, symbolizing the second time Schutz handed over the keys to the management company. . Five years later, the key is back in Schutz’s hands.

When can Starbucks “quit Schulz” and become a restaurant group that can solve problems without a founder? Maybe this is the more worthwhile question to ponder.