The Next Starbucks CEO Will Be Critical -- Here's Why

Over the past few years, Starbucks (SBUX 1.55%) has seen a lot of shuffling at the leadership level. Notably, in March 2021, Chief Operating Officer and President Rosalind "Roz" Brewer left to become CEO of Walgreens Boots Alliance. This month, CEO Kevin Johnson announced he was retiring, with Howard Schultz once again returning to lead the coffee chain as chief executive -- but only on an interim basis. In this episode of "Ask Us Anything" on Motley Fool Live, recorded on March 18, Fool.com contributors Jason Hall and Jamie Louko discuss whether Starbucks has a management talent problem.

Jason Hall: The more I think about the cadence of how this has played out and changes in the company's executive suite over the past number of years, I'm not so sure. Scott Maw was the chief financial officer, he retired. The company's had two replacements since he's retired. There are three CFOs over the past four-ish years or so. Roz Brewer wasn't just the president and chief operating officer, she was a board member in Starbucks. As a board member, it seems that she would've been purview to the things that were going on with Kevin Johnson retiring, or having plans there. Again, we don't know her motivations for deciding to take the opportunity at Walgreens a year ago, it was a year ago this month, versus staying for some like you said, Dan, some indeterminate period of time. But there are things you could do, right? Co-CEO. There are things you can do to compensate somebody as talented as Roz Brewer. Then thinking about a company like Starbucks has always focused on things like equity and inclusion, and to have woman who is also a minority as CEO and also happens to be a very, very talented leader. It seems like just a missed opportunity. Again, they've had those other changes, and I'm less convinced about the corporate health of Starbucks as its ability to recruit and develop young executive talents. How am I wrong here?

Jamie Louko: I don't think you're wrong at all, Jason. There have been some hiccups in the past, and whoever the board appoints is going to be very critical, more so than normal, I think, in my opinion. Solely because that the board knew that this was going to happen and nothing really was done about it. They talked about not necessarily wanting to hire over Zoom or dealing with the pandemic, and I fully understand that. But now that it is here, we're going to need to see some execution, follow-through, where this is a very smart hire. And if three months go by, and we see an inside hire or something like that, it just brings up, why are you doing this? You didn't prepare whatsoever for this, really. Then, after three or four months, you're going to hire somebody from the inside. That just poses some questions about the attractiveness of this job to outsiders. I'm not saying that an inside hire is a bad thing. The fact that they made some excuses on why they couldn't hire wider, just getting into this now, why they haven't started the process until just now, they're really going to have to follow through in the next few months to really execute and get a star-studded CEO.