Saturday, October 18, 2008

The Coffee King: Howard Schultz is Born.

“I wanted to be in charge of my own destiny,” says Howard Schultz. “It may be a weakness in me: I'm always wondering what I'll do next. Enough is never enough.” Schultz used this weakness to his advantage, taking the U.S. by storm with his vision of a coffee shop the likes of which the country had never seen before. Today, as a so-called ‘third home’, Starbucks has revolutionized not only the coffee industry but also society at large. 

Howard Schultz was born on July 19, 1953, in Brooklyn, New York as the oldest of three children. He grew up in Bayview Project, a government-subsidized housing unit. His family had little money and both parents worked long hours to try and support the family. Growing up, Schultz spent most of his time playing sports, taking a particular liking to football, baseball and basketball. He found that he quickly excelled in each of these in high school and used it to his advantage, receiving a football scholarship to Northern Michigan University. 

Schultz was determined to escape poverty and become the first member of his family to graduate from college. In 1975, he realized his dream and earned his bachelor’s degree in business and marketing. But, while Schultz’s academic career was soaring, his family life was taking a turn for the worse. His father was starting to suffer from the never-ending stream of low-paying, dead-end jobs he was forced to work. “I watched my dad’s self-esteem fracture,” Schultz would later recall.

Nevertheless, Schultz was determined to make more of his own life. After graduating, Schultz moved back to New York and got a job working for Xerox Corporation. He then switched to working as a salesman for Hammerplast, a Swedish housewares company. When he noticed that he was selling many coffee percolators to a little Seattle-based company, Schultz flew out to see why.

In 1981, Schultz met with Gerry Baldwin, one of the owners of Starbucks, and he immediately fell in love with the company and the concept. In less than one year, Schultz had left Hammerplast and had become Director of Retail Sales for Starbucks. But, Schultz’s vision for the company soon took a different turn from its original owners. 

When Schultz first joined Starbucks, it had 12 retail outlets and was dedicated to selling coffee beans and coffee-related products. In 1983, Schultz went on vacation to Milan, Italy, and became infatuated with the idea of coffee bars, places where gourmet coffee was served not in beans, but by the cup, and where people could come to meet and relax. “I believed the relationship I saw between people and coffee in Italy was transferable to America in a big way,” he said. 

“Great companies recognize who they are and who they are not,” said Schultz. “But they must have the courage to examine transformational opportunities”. The owners of Starbucks disagreed with Schultz’s vision. They had little desire to expand their company in the way Schultz was proposing. But, confident in his idea and the untapped possibilities, Schultz left Starbucks and started out on his own.

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