Transformational leadership and Starbucks

Over the next few weeks, I am going to be writing a series on transformational leadership. In my next post, I will define the concept as well as an alternate style called transactional leadership. To kick off the series, I wanted to illustrate the hallmarks of transformational leadership through the story of one of my favorite transformational leaders: Howard Schultz, the founder of Starbucks.

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Howard Schultz is a transformational leader because of the way he developed a vision and then made it into a reality in partnership with Starbucks’ other employees. His vision was for Starbucks to be a “third place” between home and work and that Americans would pay $3-5 for a cup of coffee. Schultz used his charismatic personality and values to develop a transformational work environment at Starbucks that built a coffee empire. He uses motivation, influence and referent power to overcome business obstacles and achieve shared success.

Evidence of Howard Schultz transformational leadership qualities are a key component of the Starbucks operation. In the most obvious example, Starbucks refers to all its employees as, “partners” and offers them stock options and health care benefits (for both full and part-time employees) . He writes, “From the beginning of my management of Starbucks, I wanted it to be the employer of choice, the company everybody wanted to work for.” Schultz realized that leadership was about the people at the front lines doing the work to bring his vision to reality. He focused on the employees and used his strong motivation and influence skills to achieve his vision.

Schultz has also demonstrated the ability to motivate his employees both in terms of direction and emotional intelligence. On the first day Starbucks was in business, Schultz went to address the other Starbucks partners. He had three points written down on a 5-by-7 note card that read, “1. Speak from my heart. 2. Put myself in their shoes and 3. Share the Big Dream with them.”

When the response to Schultz’s first speech was a combination of skepticism and guarded optimism, he recognized what he needed to do. Schultz knew he had to develop referent, expert and position power in addition to his legitimate power role as the CEO of Starbucks. He used the tactics of shared benefits, consultation and collaboration, emotional calibration and consistency to motivate his new employees. He writes, “The only way to win the confidence of Starbucks’ employees was to be honest with them, to share my plans and excitement with them and then follow through and keep my word, delivering exactly what I promised – if not more.”

Schultz focused on outcomes, satisfaction and trust to build employee commitment to Starbucks, which minimized turnover and retained employees who were aligned to the vision and brand for Starbucks. He writes, “A business plan is only a piece of paper, and even implemented properly [is not complete] unless the people are committed to it with the same heartfelt urgency as their leader.” When Starbucks lost its way, in Schultz’s eyes, he closed all Starbucks locations temporarily for mandatory training, including lessons on how to make the perfect espresso shots.

Schultz has impacted not only the Starbucks partners who have grown and thrived with the company, but also the patrons of Starbucks. In his book Onward: How Starbucks Fought for Its Life without Losing its Soul, Schultz describes the reactions of patrons when they learn that their neighborhood Starbucks was closing due to the suffering performance of the company, when, at one point, it was nearly at the brink of bankruptcy. They felt the loss on a deep emotional level because of what the store meant to the community. Schultz describes stories where people reacted emotionally to the announcement that the store they frequent was closing. One woman in Minnesota wrote, “I can’t believe that ‘my’ Starbucks is closing. You never know how important a place is until you are about to lose it.”

The impact of the Starbucks that Schultz created has also impacted me personally. In fact, I have written portions of this post from a Starbucks. It is incredible to me to witness what Schultz visioned coming to life in front of me. I was recently in one of the first Starbucks locations on the East Coast in Friendship Heights. The layout, the service, and the atmosphere was exactly how Schultz would have described it to a potential investor, partner or customer. There was a romance to the coffee service, and sitting there doing work at a table and drinking from my own personalized cup of coffee was surely a small but meaningful luxury. Knowing how much work it took Schultz to achieve that vision, including overcoming many skeptics and frequent trips to Italy, made the taste of my peppermint mocha even sweeter.

KEY TAKEAWAY: Transformational leaders pursue an important vision by empowering people to be a part of something larger than themselves. Leaders like Howard Schultz lead through respect and empowerment.

The Power of Visualization

Last week in Baltimore, I participated in two continued-learning opportunities through the American College of HealthCare Executives (ACHE). I always look forward to learning opportunities like these—being in a classroom type setting, learning about what is new and what is coming in the field brings back fond memories of learning as a grad student.

In the first session, we used a tool that was familiar to me, called the Business Model Canvas. This canvas is one of a series of tools from Strategyzer. It is used to visually map out a business model, using a tool that focuses on delivering value to the customer (called the “Value Proposition”). This tool is useful for both new and existing businesses and can be utilized in strategic planning for any organization.

In addition to the Business Model Canvas, the seminar introduced a variety of other canvases, such as the Context Map Canvas, the SWOT (Strengths, Weaknesses, Opportunities, and Threats) visualization tool, and the Innovation matrix to name a few. Teams of people who had just met a few hours before were then tasked and able to work on the same page using the canvas frameworks.

It made me think about the power of visualization tools and how leaders can better utilize them. To be clear, I am not talking about PowerPoint presentations or those poster slides that Members of Congress use. I am referring to a tool that gives participants an opportunity to be an active part of crafting a narrative and creating something new.

I have noticed throughout my career that many executives under-utilize visualization tools, which is an opportunity lost. Visualization, done right, can build out a better framework for solving a problem, while simultaneously building understanding and trust. Without visualization, it is incredibly difficult to get multiple voices to properly understand and participate together in an activity.

For a while, I was hesitant to go up to the whiteboard and facilitate a discussion at work. I thought sometimes it was cliché to do so. But I was wrong. If you ever get the urge to go up and write something out, or draw something new, it will help the group as a whole facilitate their understanding. A leader’s ability to use visualization and facilitation to achieve team synergies is a must have.

I encourage you to never hesitate to use visual tools when leading a group. Check out the resources at Strategyzer to help you to determine how best to apply visualization beyond the Business Model Canvas. All it usually requires is a marker or two, a white board, sharpies and post-its. Happy visualizing!

KEY TAKEAWAY: Developing visuals help facilitate teamwork and team trust. Visualization and facilitation are must have skills for leaders looking to solve complex problems in a team environment.

Book Review: Prescription for Excellence

You may have noticed that health care has been in the news a lot recently. Whether it is the Democratic Party presidential candidates talking about their plans, price transparency, or access to prescription drugs, it is fairly safe to say that the current system is not working for a group of people in our country.

There is so much to fix, including the experience of receiving care. Many patients experience customer service outside of health care and they expect that same level of care, treatment, ease, and convenience.

RxforExcellenceSeveral years ago, the University of California, Los Angeles (UCLA) health system decided to work on fixing the experience of care. Their results were astounding, going from the 30th percentile of U.S. hospitals to the 99th percentile. Dr. David Feinberg, the then CEO of the UCLA hospital system (he has since run the Geisinger Health System and now is the VP of Google Health), was committed to doing better as the UCLA system grew in Southern California.

Using the lessons from other retail leaders who are known for their customer experience, UCLA did some progressive things to enhance and enrich the hospital’s patient experience. The progress is summarized in Joseph Michelli’s book Prescription for Excellence: Leadership Lessons for Creating a World-Class Customer Experience From UCLA Health System.

I appreciate that Dr. Michelli, who has written on companies like Starbucks and the Ritz Carlton, used part of his introduction to the book to acknowledge why it was important for him to write about a health care organization. The demands are high, regulations abound, safety is paramount, and politics are rampant. Delivering excellence in that environment is a unique feat and one that keeps those of us who are part of the business aspect of health care both fired up and very busy.

What I enjoyed about Prescription for Excellence was learning about the leaders from the organization who invested in the patient experience system, called “CICARE” (pronounced See-I-Care). Leaders modeled the behaviors that they asked the staff to model as well, and they were constantly present, speaking to patients to learn more about their care.

What UCLA figured out is that, just like in another industry, the three main elements of hard-wiring a consistently excellent and customized patient experience are: alignment, empowerment, and engagement. CICARE was their system of alignment, they empowered the team to act on it by training them, and engaged them in the work, partly by emphasizing the importance of it.

The following quote in the book sums this idea up nicely, “Relationships-based caste is often about empowerment. Empowerment starts with leaders giving staff members the tools and the trust they need to provide extraordinary service. Those tools include structure service behaviors…When well-selected employees are given resources, trained, and empowered effectively, extraordinary service relationships developing, and customers are empowered to build skills that meet their needs.” (Michelli 64).

Developing systems and allowing people to innovate within those systems are keys to delivering service excellence whether in health care or any other industry.

KEY TAKEAWAY: Excellent service systems are created from aligned, empowered, and engaged team members.


Prescription for Excellence is available for purchase on Amazon for $30 (does not include Prime discount)

Empathy in action

Several months ago, I ran across this emotional video about the power of empathy and leadership in health care:

I often share this video and Jap’s story for several reasons. His positive attitude, coupled with his thoughts of wanting to do more with his life are inspiring. While his injury took away the use of his legs, it gave him a fresh perspective and new motivation in his life.

From a health care delivery standpoint, Jap’s story teaches us that we must do more for our caregivers and that anyone in the hospital can lead to make a patient’s experience better.

As you watched the video, did you notice what happened when Jap woke up from his accident? The first thing he did was scream out. But, nobody came to his aid. He was on the “diving accident floor” in the hospital, and according to the nurses, everyone on that floor screams after they regain consciousness. To the nurses, every scream was, “just another day at the office.” To Jap though, it was one of the scariest and worst moments of his life, and he was alone.

In my current role, one of my main responsibilities is to work on this very issue. Clinicians can become used to or numb to other people’s suffering. It is not because our bedside caregivers are bad people or doing something wrong, it is simply because of the nature of the work. Part of the role of patient experience is to create systems to remind caregivers that, for the patient, this is not just, “another day at the office.” Part of this work is done by creating mechanisms to constantly remind caregivers that our patients do not come to work in a hospital and the days they are here are unique to them. We must help caregivers connect to the fundamental emotions of most patients: That they are scared, stressed and confused.

The other lesson Jap teaches us is that anyone can lead. Carlos, Jap’s nurse in the ICU, not only goes to him when he screams, but instructs the other nurses how to comfort Jap. Carlos was behaving in a way that creates positive, peer-to-peer accountability. Carlos authorized himself to help the entire team care for Jap in his hour of need. Carlos took it upon himself to provide the reminder that this was a unique day in Jap’s life and he will need help to get through it. Carlos embodied how, in hospitals especially, patients expect more than just us treating a disease or an injury; they expect to be treated like people.

This powerful video shares these lessons elegantly and they apply to any work that we do interfacing with other people.

Thank you for sharing your story, Jap.

KEY TAKEAWAY: Patient experience is about reminding people to see care through the eyes of the patient and to treat their emotions, not just their physical condition. Anyone can lead in patient experience, it is up to leaders to create mechanisms for peer-to-peer coaching and accountability. 

Customer Service or Customer Experience?

One of the recurring topics of this blog relates to, “How we treat each other.” I am passionate about improving the patient experience at hospitals because I believe it has powerful implications for how we treat each other. If clinicians can demonstrate compassion, courtesy, and kindness during a difficult moment in a patients’ life, imagine how that level of care could impact how that patient will treat others in the future. Like other social epidemics, I believe that kindness can catch on as well.

A colleague of mine at Adventist HealthCare shared this 17 minute video with me. In the video, Fred Lee, the author of If Disney Ran Your Hospital, gives a TED talk about the difference between customer service and customer experience.

Lee defines a service as, “Labor done for me that I would otherwise do for myself”. He goes on to share and explain how an experience is far more emotional, difficult to measure, and impossible to fully control through mechanisms like scripting. Defining the journey of a patient as an experience allows us to embrace the fact that it doesn’t mean our patients have to be happy all the time when they are under the care of a hospital.

Lee uses a helpful analogy in the talk to explain this idea. When we go to the theater, sometimes we go to see plays and musicals that make us happy, while other times we see dramas or tragedies that touch our emotions in a different way. Both instances are experiences that speak to the human condition, not necessarily only positive emotions.  Lee describes this as, “We in the hospital business have the job of meeting the emotional needs of a family going through fear, pain and even tragedy together.”

Further, he says that “A hospital without compassion is like a trip to Disney without fun.”

When hospitals and other companies deliver an experience, it resonates with the consumer emotionally. In a hospital setting, emotion is already present. How clinicians understand the emotions of the patient and anticipate the patient’s needs shows how much they care and that they are attentive to the situation.

Lee tells a story of a caregiver who comes to take blood from a patient. In the first scenario, the caregiver follows a script. In the second, the care giver provides an experience. He quotes a Gallup organization study that found that just using the word “gentle” reduced a patient’s pain when receiving an injection. Small touches can radically change a patient’s care experience but it has to be individualized – not every interaction will be the same or have the same effect for every patient.

Lee posts this quote during his talk: “Experiences occur with any individual who has been engaged in a personal and memorable way…on an emotional, physical, intellectual, or even spiritual level. The result? No two people can have the same experience – period.” B. Joseph Pine III, The Experience Economy

Since experience is so individualized, it involves developing active listening skills, focus, compassion and empathy. Conveniently, these are the same skills that we can all demonstrate on a daily basis to each other to make the world a better place, not just in the work setting. While health care is a powerful setting to deliver an incredible experience, we can all be human experience ambassadors with our friends, family, colleagues, neighbors, and even strangers.

The first step is to want to make a difference in this way. Will you join me in being a human experience ambassador?