The Wall Street Journal this morning reports that Starbucks CEO Kevin Johnson, whose tenure lately has been battered by a declining stock price and a nascent unionization effort, is stepping down, effective April 4. He will be replaced - the company says on an interim basis - by the company's longtime CEO, Howard Schultz, who built the company into the nation's preeminent and ubiquitous coffee brand.
The Journal writes that the decision to leave was Johnson's, and that he was not pushed out; Starbucks says that the 61-year-old Johnson, who took over from Schultz about seven years ago, " first signaled to company directors around a year ago that he was thinking about retiring, and hoped to do so when the pandemic wound down." The story says that "Starbucks’s board hired executive search firm Russell Reynolds Associates last year to help plan for Mr. Johnson’s possible departure, the company said. Starbucks said it hopes to choose a new CEO by the fall."
The story goes on: "Now Mr. Schultz, 68 years old, is returning for his third stint heading Starbucks. He stepped down as Starbucks CEO in 2000, and returned in 2008 as the company sought to improve its performance. Mr. Schultz, who flirted with a run for U.S. president as an independent in 2019, currently heads his family’s foundation and is involved in philanthropy."
- KC's View:
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Do I get to take a victory lap on this one?
Because I've been saying for months - pretty much from the beginning of the unionization efforts at Starbucks - that this would play into Schultz's messiah complex, and that somewhere in Seattle he was rehearsing his "I have returned" speech.
I'm not saying that this is a bad move. Schultz is a force and an estimable business personality. I'd expect the stock price to get at least a temporary bump, and Schultz will be all over the media talking about getting back to the fundamentals of Starbucks' vision and mission.
But … seven years is a long time, and Schultz is returning to a company that is different from the one he left, and to a business and labor climate that has changed significantly. I would also expect that he may be frustrated by what he finds when he returns to the c-suite atop Starbucks' Seattle headquarters.
I wouldn't be surprised, though, if Schultz stays longer than is currently being projected. If he's enjoying himself and moves the stock price and labor needles in positive directions, it might make sense to stay in the CEO job for a little longer just to stabilize the place.
Think of Howard Schultz as the Tom Brady of business executives.
