February 28, 2007

Mirror, mirror

Starbucks chairman Howard Schultz has caused a minor earthquake for arguing in a recent memo to company executives that the ubiquitous coffee merchant has lost its way. Asking that the company look in the mirror and reflect on the decision it made to grow from 1000 stores to 13,000 over the last decade, Schultz contends that Starbucks has been watered down and commoditized.
I say "Bravo, Mr Schultz!" If only more companies took stock at the concept of unbridled growth.
This reminds me of a conversation I had with 1-800-GOT-JUNK founder & CEO Brian Scudamore last year here at Queen's. He said he wanted to take his rubbish and debris removal company from a $120-million to a $1-billion company over the next decade. I asked him what consideration he had given to the environmental footprint a $1-billion company would have and whether he felt the service & experience that now defines his company could be sustained at that level of sales. Sadly, he had no real answers to these questions.
Contrast this with Patagonia founder Yvon Chouinard, whose company by the late 1980s was on track to be a $1-billion company within a decade. This was no cause for celebration. He recognized that Patagonia "had exceeded its resources and limitations; we had become dependent, like the world's economy, on growth we could not sustain." In typical Chouinard fashion he considered every and all options, including even dismantling the company.
In the end, he chose to advance an "ecology" of values and focus on a path for Patagonia for the next 100 years. As he writes in an excerpt from his outstanding book, Let My People Go Surfing: The Education of a Reluctant Businessman, "When you get away from the idea that a company is disposable, all future decisions in the company are affected. The owners and the officers see that, since the company will outlive them, they have responsibilities beyond the bottom line. Perhaps they will even see themselves as stewards of the earth." [Illustration: "The Mirror of Galadriel" by Alan Lee]




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