In a move that may prove to be more "jerk" than "knee-jerk," investors sent shares of Starbucks
I think Schultz is a genius. It's hard not to like him. I just think the market is underestimating the daunting task that lies ahead for Schultz in reviving shares that fell by a staggering 42% last year.
It won't be easy, even if shareholders appear giddy at the moment. Even his immediate plan to scale back expansion from the 900 company-owned units that were supposed to open this year is being misinterpreted as a return to focus rather than a sign of brand failure.
Shares of Jamba Juice parent Jamba
Don't get me wrong. I think Starbucks was naive to underestimate just how saturated the domestic market has become in its effort to please the market with acceptable unit growth numbers. Scaling back on stacking Starbucks on top of Starbucks and shuttering underperforming stores is the right call. I just think investors who are applauding a retreat don't fully understand the implications behind losing this particular battle.
The flawed romanticism of the helmed founder
Shares opened 5% higher when Michael Dell announced he would be donning the CEO hat again at Dell
Over at Yahoo!
The root of the misplaced romanticism is obviously Steve Jobs at Apple
Brews and bruises
Schultz gets brownie points for seeing the company's demise when he wondered if Starbucks had lost its soul last winter. Somewhere between the automated espresso machines and the homogenization of the Starbucks format, the heart of the company stopped beating. However, Schultz was never too far away from ousted CEO Jim Donald's ear through all this.
Schultz's missive -- like the Brad Garlinghouse's Peanut Butter Manifesto at Yahoo! -- are spot on, but recognizing the problem doesn't mean it can be fixed.
Keep in mind that it's been seven years since Schultz handed over the CEO reins to spend time nurturing other Starbucks side projects like its Hear music initiative. Back then, virgin soil was everywhere, and there really wasn't a major Euro-themed premium coffeehouse concept nipping at the chain's heels.
These days, you can get premium coffee -- good premium coffee -- at fast-food chains, convenience stores, and at home through advanced brewing systems. Once Consumer Reports ran a story last year indicating that consumers in a blind taste test preferred McDonald's
Starbucks has broadened its reach into serving up breakfast items, installing the same speedy TurboChef
You know Schultz will do everything in his power to stop that from happening, but it doesn't stop McDonald's from attempting to mimic its every move.
Schultz has plenty to lose. Since they've been proven mortal in their rebuffed revival efforts, the names of Michael Dell and Jerry Yang no longer convey a dreamy storybook luster. As this week's reretirement of Washington Redskins coach Joe Gibbs shows, it's never easy to reclaim your former glory.
The game didn't pass Gibbs by. It simply caught up to him. The same can be said of Schultz. I'll root him on like everyone else, hoping that he has the vision to step down on his own terms if the task proves too daunting, before his sterling reputation slips through the cracks of his foolhardy spine.