Starbucks: Respect for Workers and Health Care

Starbucks Corp. CEO Howard Schultz interview on Marketplace

I grew up in Brooklyn, New York. I guess it’s been well documented, many times, in federally subsidized housing known as the projects. My dad never made more than $20,000 a year and I saw first-hand what it was like to kind of live on the other side of the tracks

the company is deeply-rooted in a sensibility and trying to build the company with a conscience primarily, I think, defined by the fact that we did something in 1989 and 1990 that had never been done before, which was creating a program in which we had comprehensive health insurance for all employees including part-timers and created a mechanism for equity in the form of stock options

What about those that believe you should cut spending on employees, since health care, for example, is so expensive?

We’ve created more productive people and created an environment where Starbucks in many places domestically and around the world is the employer of choice and we are able to attract and retain fantastic people because of the culture of the company, which is defined by these benefits. So my argument is simple, it’s which investment do you want to make? An investment in your people or do you want to make an investment in the hidden costs of turnover and retraining your people?

So many companies talk about how people are the companies most important asset, so few act that way.

the only reason we are in business is because of the quality of people that we’re able to attract and retain, coupled with the quality of coffee that we can buy and roast. If we don’t do those two things well, we are finished. We have no secret sauce, we have no patent, we have no technology, those are the only two pieces of the puzzle that can differentiate Starbucks.

In the interview, Mr. Schultz he talks a good deal about the health care problem in the USA – declared a deadly disease by Dr. Deming in the 1980’s.

So but I think what we’re talking about now is a U.S. crisis in which the country is on a collision course with time with regard to the health care issue and what we’re facing. Beginning with the fact that between 46 and 50 million Americans do not have health insurance and that in and of itself probably for me personally is in a sense the fracturing of the humanity of America when you think about it. And so this is a, as you mentioned an American problem, it’s a business problem, and it’s a problem that will not be solved until you get the three constituencies at a minimum, which is government, business, and citizens to come together in a way in which we take the political issues aside and create a bipartisan cooperation in which we solve this once and for all.

Well, to put it in perspective, for three consecutive years now, we have faced double-digit increases from the year before. And when I talked to my peers or other people running significant businesses in America if it’s not the top two or top three issue it’s in the top five of the most significant challenges on a go forward basis. So I think you’re seeing an outcry of businesses across the country, large and small, not to mention the up to 50 million people who don’t have health insurance, and we have to solve this problem. And this is not something that’s going to go away, it’s something that’s only going to get worse, and it’s also making America a . . . putting us in a deeply competitive subordinate position globally because we’re dealing with countries whose citizens do have health insurance.

He is exactly right. It is a difficult issue to address but after 30 years of excuses it is time for people to get past declaring it difficult and get to work instituting workable improvements. It won’t be easy but the harm caused by refusing to deal with the issue is to large for us to bear. The risk to the economy of continuing to fail to address this issue are huge.

Related: Saving Lives: US Health Care ImprovementUSA Health Care Costs reach 15.3% of GDPVA Medical CareHealth Insurance Premiums Soar Again

2 thoughts on “Starbucks: Respect for Workers and Health Care

  1. So many companies talk about how people are the companies most important asset, so few act that way.
    the only reason we are in business is because of the quality of people that we’re able to attract and retain, coupled with the quality of coffee that we can buy and roast. If we don’t do those two things well, we are finished. We have no secret sauce, we have no patent, we have no technology, those are the only two pieces of the puzzle that can differentiate Starbucks.

    In the interview, Mr. Schultz he talks a good deal about the health care problem in the USA – declared a deadly disease by Dr. Deming in the 1980’s.

    This is correct i think

    Reply
  2. Pingback: Curious Cat Management Improvement Blog » CEOs Want Health-Care Reform

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