A couple of weeks ago in the UK, Starbucks was all over the newspapers and even the TV news. It was one of those tabloid-y stories. In fact, the ultimate UK tabloid, The Sun, started it and the rest of the media picked it up.
The story attacked Starbucks for one of its operating practices, depicting the company as, well, an irresponsible company. The story wasn't about the quality of Starbucks' coffee. It was about how it cleans its cups and spoons. The UK stores (and I presume it's part of Starbucks' operating procedures globally) leave a tap / faucet running all day in the washing-up area - from the moment the store opens to when it closes. Apparently it's a well-proven hygiene measure: flowing water prevents the build-up of bacteria.
Now the company has had to issue a statement saying it is reviewing this procedure, after the UK media painted a picture of the company as environmentally irresponsible, as a 'bad' company. Put aside for a moment the sensational practices of the UK press andthe fact that there are arguments for and against Starbuck's hygiene practices. And you are left with the inescapable result: a tarnished reputation.
How many customers, walking along the high street or mall, to get their daily fix of caffeine, will now walk past their local Starbucks and into a rival coffe bar? Since The Sun's circulation was four million last time I looked, and the story was picked up by BBC TV news, the law of big numbers says quite a few thousand of those will be moved to avoid Starbucks if they can, at least until they've forgotten the story, and as long as there is a convenient alternative a few doors along the street. And, in these days of coffee bar over-supply, of course there are.
'Being good' used to be seen as non-core to business. Now, particularly in highly competitive times, it is core. For corporate leaders at all levels - from the Board room to the manager of your local Starbucks, and also to the baristas at your local Starbucks - need to realize now that environmental impact, and, more hazily, perceived environmental impact, is just as big a factor in customers deciding to do business with you versus the competition as your actual product.
I mention the baristas, because if they had perhaps picked up negative messages from one or two customers asking "Why do you keep the water running like that: surely you're wasting millions of gallons"? and fed them up the decision-making chain, in the way that Amazon lets its customer-facing employees point out potential problems, this particular issue might have gone away before it damaged their business, as it undoubtedly has.
As you lead through tough times, have you left your company exposed on any corporate responsibility issues? It's worth taking a minute to re-think your idea of core and non-core if so.
by Jim Taggart
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