2 Leadership Traits Howard Schultz Used To Grow His Brand

June 21, 2018

  By Justin Biel, trends editor at Grow Wire

In short:

  • Howard Schultz(opens in new tab) was able to develop a culture of employee respect through his transformational leadership style(opens in new tab), leaving behind an example for other business owners.
  • Schultz has a belief in intellectual stimulation, which led him to create a brand that broke the norms of coffee culture.
  • Secondly, he has a clear vision, which resulted in a company culture with a strong employee focus. 

Howard Schultz(opens in new tab) is a transformational leader who kicked off the U.S.’s second coffee revolution(opens in new tab). His employee-focused leadership style left a template for other business owners to follow as they grow their own enterprises, and Schultz grew a global brand in the process.

Spurred by his brand vision, Schultz reinvigorated the coffee industry while building one of the world’s largest coffee chains(opens in new tab) with an employee-centric team. He used two classic transformational leadership practices(opens in new tab) to do this.

1. Intellectual stimulation

Transformational leaders like Schultz are marked by a belief in intellectual stimulation(opens in new tab). They aren’t afraid to rock the boat, prefer a flow of new ideas and challenge status quo.

Schultz certainly challenged the status quo with his plan to create Americans’ “third place(opens in new tab),” the most-visited site after home and work. This was unheard of in corporate coffee culture at the time. The "third place" concept involved  retail locations with inviting decor, calming music and famously speedy Wi-Fi so patrons would feel at home. Whereas other grab-and-go food stops are less inviting, Shultz was bold enough to imagine a place that felt more like home. This helped him become a category king(opens in new tab) of coffee chains.

2. Clear vision

Transformational leaders also have high motivation and a clear vision(opens in new tab), which they share openly with their teams.

Schultz had motivation to develop a massive company and, more prominently, a vision of supporting his employees. He instituted new programs to support workers(opens in new tab), including health benefits for part-time workers, tuition assistance, veterans hiring and an employee stock purchase program.

Schultz’s focus on employees came largely from memories of his father(opens in new tab), who worked as a truck driver. When Schultz was seven years old, his father broke his ankle and lost his job. The family suddenly had no income. The experience stuck with Shultz, and later, when building his own brand, employee fulfillment and dignity became a top priority.

Schultz explained his dual focus -- profits and, more importantly, people -- on a Marketplace podcast(opens in new tab) in 2014.

"I feel strongly that we have demonstrated that we are a performance-driven company(opens in new tab)… At the same time, we have done all this through the lens of humanity, and that's what I'm most proud of,” Schultz told Marketplace.

Strong leadership qualities propelled Schultz forward, allowing his company to differentiate itself and usher in the second wave of the coffee revolution. We can't wait to see what the "third wave" of his career holds.

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