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A friend from my Starbucks days passed away recently from a heart attack. He was a long-time Starbucks partner (employee) who helped shaped the way baristas gained coffee knowledge. This is a massive loss for his family, friends and for thousands of Starbucks partners he touched.

Tim touched me. I will always remember how he served as a bridge between old school Starbucks partners and new school Starbucks hires.

No doubt Tim was on my mind many years ago when I wrote in my love story to Starbucks about the importance of building bridges between old employees and new employees.

The following is an excerpt from TRIBAL KNOWLEDGE: Business Wisdom Brewed from the Grounds of Starbucks Corporate Culture (Kaplan, 2006).


TRIBAL TRUTH #39

Build Bridges Between Old Employees and New Employees

TribalKnowledge_150As businesses grow, so does the need to hire more people to handle the increasing workload. Eventually all growing companies face the situation of needing to combine the talents and perspectives of long-time (old-school) employees with those of recently hired (new-school) employees. Integrating this influx of new hires with long-timers has been one of the greatest challenges Starbucks has faced in growing its business.

A company will not realize its future if it doesn’t understand its past. Old-school employees are able to maintain the company’s connection to its roots as well as serve the valuable role of helping indoctrinate new school employees to the cause.

At the same time, it’s very easy, as an old school employee, to discredit the ideas of someone who hasn’t matured in the company. This is especially true for a company like Starbucks, where people who started in the late 1980s or early 1990s helped the company grow up and grow global. Even today, with the fast pace of Starbucks’ growth, it’s easy to feel that a mere few years rendered the experience of decades. That’s great to foster a sense of ownership, but it’s also an easy way for folks to get set in their ways.

Through trial and error, Starbucks has learned how to bridge old school thought with new school thinking. The following bridge-building lessons learned are simple but important for growing companies to follow.

1. Offer Solutions, Not Obstacles

When batting around ideas in meetings, old school employees need to be careful not to say, “Yeah, but that’ll never work. We tried it a few years ago.” Instead, old school employees need to learn to say “Yes…and.” As in, “Yes, and we will need to solve for this issue because last time we did something similar and things didn’t work as expected.” This does two things, it lets the new employees know what the current concerns are and it gives a glimpse of company history—in this case, why the idea might be met with some resistance by someone else.

2. Be a Teacher

While new employees have the chance to share the experiences they gained at other companies, old School employees need to take the time to teach new school employees nuances about the culture of the business. For example, every Starbucks meeting used to begin with a coffee tasting. During these tastings, partners would celebrate and discuss coffee much like wine enthusiasts discuss wine. Admittedly, it’s impractical to start to every meeting with a coffee tasting, but old school partners would find ways to make it happen. And now, many new school partners are keeping the company tradition alive by ensuring coffee tastings happen before meetings.

3. Listen First, React Second

We’ve all seen this scenario before where a new hire comes in with guns a’blazing and shoots himself in the mouth by saying too much too soon. New school employees should spend more time listening and less time reacting during their initial stages of employment. An unwritten rule at Starbucks was to wait at least six weeks before speaking up with strong opinions during meetings. A whole lot can happen in six weeks, mostly the opportunity to learn about the corporate culture and enough about the company’s past to anticipate likely reactions to new ideas.

Of course, new school employees are hired for a reason—they have valuable experience gleaned from other fields and businesses. Their ideas and their approach to thinking often is what got them hired in the first place. Following the six-week rule goes the extra step into solidifying the credibility of any new hire because it shows that the new school employee values the existing culture and wants to learn about it before offering powerful changes.

4. Befriend an Old-School Employee

Starbucks establishes mentor/mentee relationships for many executives coming from the outside. So many times, when new managers come into a company, they believe the best way to gain respect is by spouting tough opinions and issuing strong solutions. They feel they have to prove themselves to justify their new positions. Starbucks avoids this by assigning new managers to mentors, other executives with eight to ten years of experience, often having worked their way up the Starbucks ranks. Being teamed with those who are used to working in a people-focused culture markedly helps the transition from outsider to company-, community-, and employee-focused partner.

Through these relationships, outside executives are able to better learn the cultural do’s and don’ts of the company. As a result, fewer e-level partners flameout, and instead go on to make significant contributions to the company for years on end. Befriending a long-time employee is an easy step that the savviest new-school Starbucks people make happen.

Leading Questions…

  • What does your company do to integrate new employees into the company culture?
  • How well was the most recent new thought employee welcomed into the company? Would you like this person’s experience duplicated with the next new hire?
  • It was October of 1994, twenty years ago, when the trajectory of my life changed.

    I was living with my parents and back in school getting a second degree, this time in marketing. College loans helped to cover tuition but I needed a part-time job to cover other expenses like food (and my bar tab at the Barley House).

    Enter Starbucks Coffee.

    As a marketing student, I had heard of this upstart coffee chain but never stepped foot in one.

    Starbucks was holding a hiring fair at their meager Dallas training office tucked deep inside an office building. When I entered the windowless office I was handed a cup of House Blend. (I still remember how amazingly flavorful that cup of coffee tasted.) I filled out the job application and was immediately put into an interview.

    For most people a job interview is not a big deal, it’s just talking. But for someone who stutters, it’s a HUGE deal because… it is just talking. Some how I managed to minimize my stutter enough that it was a total non-issue.

    I was offered a barista job at Starbucks store #677 (Preston Center). That was October of 1994.

    A year later I was out of school and working as a Media Planner at an advertising agency in Dallas but I still kept working at Starbucks with a Saturday morning shift behind the bar slinging lattes.

    Frustrated with my job at the advertising agency, I abruptly quit. I became a vagabond barista picking up odd shifts at Starbucks locations all over Dallas.

    Then fate interrupted.

    Starbucks was growing so fast they couldn’t manage all of the local store marketing activities happening in the field by the small marketing team at corporate in Seattle. They created a field marketing department and Dallas was one of the first markets to get a zone marketing director.

    This marketing director, Lisa, needed help and I saw an internal job posting for a field marketing specialist. I sent my resume in and a few days later I had my job interview at the Creekwalk Village Starbucks in Plano.

    I vividly recall that interview. I dressed in a snazzy Banana Republic suit and carried a Coach leather bag with examples of my work as a Media Planner. When Lisa walked in, she saw me at the merchandise wall talking shop with Scott, the Creekwalk Village Starbucks store manager.

    Part of me believes when Lisa saw me talking shop with the store manager, she was able to envision me as a Starbucks field marketer. Much of that position was serving the needs of store managers by designing and implementing new store opening plans and creating local store marketing programs. Seeing me interact with a store manager gave Lisa confidence that I could represent her department well.

    A few days I was hired on as a Starbucks field marketing specialist.

    From there, I followed Lisa to working in the marketing department at Starbucks corporate. That experience led me to becoming the director of national marketing at Whole Foods. And that experience paved the way for me to publish TRIBAL KNOWLEDGE, which has led to a nice career as a marketing consultant.

    It’s only fitting that my Halloween costume this year honored how my life changed twenty years ago…

    Barista_2014_400

    Plato. Purpose. Profits.

    Play-To_200The ancient philosopher Plato made significant contributions to humankind. His philosophical fingerprints can still be felt today in how we think about mathematics, science/nature, morals, politics and the arts.

    Perhaps it’s time we add “brand strategy” to the long list of contributions Plato has made to civilization.

    To explain “how great companies have great purposes,” the authors of CONSCIOUS CAPITALISM draw connections between Plato’s take on transcendental philosophy and modern-day brand strategy.

    In its most simplistic form, transcendental philosophy provides a framework for understanding how we, as humankind, can live a worthwhile life.

    Plato outlined three transcendental ideals to follow in order for people to make a meaningful contribution. These same ideals can be viewed from the perspective of a how a business can live the brand in a purposeful way to become profitable.

    These transcendental brand strategy ideals, as outlined in CONSCIOUS CAPITALISM, are: The Good, The Truth and The Beautiful.


    brand ideal # 1 | The Good

    Plato believed the power of The Good happens when people are in service to others by expressing love, compassion, and empathy. Flipped to the view of business and branding, The Good is all about helping people live a better life.

    The brand purpose of improving a person’s life through products and services is an everlasting ideal.

    Starbucks is an example of a business that follows The Good ideal. Starbucks success is built upon its desire to inspire and nurture the human spirit through the connectedness that comes with enjoying a simple cup of coffee.

    The Sleep Number brand also taps into the power of The Good by improving people’s lives through a better night’s sleep. (More importantly, there is no telling how many marriages the Sleep Number bed has saved.)

    The authors specifically mention The Container Store as an enduring brand that follows The Good strategy to success because the company helps people become happier by being more organized.


    brand ideal #2 | The Truth

    The unrelenting pursuit of understanding and fighting for justice and truth is a noble way to for a person to live. It’s also a noble pursuit for a brand to follow to find long-lasting success.

    Brands living for The Truth focus their efforts on correcting marketplace injustices.

    Southwest Airlines was founded upon the principle of righting the wrongs in airline travel from making it less expensive to fly to making the in-flight experience more humane and to eliminating add-on fees.

    Whole Foods Market has found long-lasting success by bringing The Truth in the form of only selling foods that are free from artificial ingredients, growth hormones, and anything else that’s fake.


    brand ideal #3 | The Beauty

    Lives are enriched when people pursue greatness to change the world for the better. Beauty is the by-product of such a pursuit.

    When brands follow The Beauty strategy path, they embark on a never-ending journey of continuous improvement to achieve excellence. A simple way for a business to follow this pathway is to take something people perceive as good and make it better.

    The authors highlight Apple as a quintessential Beauty brand because the company is focused on making “insanely great” products. Apple succeeds by taking what is already good and making it better. It made the PC computer better through its Macintosh (Mac) product platform. It made the mp3 player with its iPod lineup. Tablets existed before the iPad but the iPad greatly improved the tablet.


    It’s amazing to think how brilliantly the ancient transcendental philosophy from Plato works to help focus a business on its higher purpose.

    By focusing supremely on its true purpose, businesses can connect more emotionally (and rationally) with consumers, leading to being a profitable and quite possibly… a transcendent brand.

    uncontainable_150
    We conclude our series sharing summaries of principles The Container Store follows to achieve its long-lasting success with a manifesto.

    While not written as a manifesto, these words from page 25 of UNCONTAINABLE are inspirational, aspirational and actionable. Enjoy…



    The Container Store MANIFESTO

    ContainerStoreMANIFESTO_520


    The Container Store posting series:

  • Hiring (Oct. 13)
  • Training (Oct. 14)
  • Selling (Oct. 15)
  • Leadership (Oct. 20)
  • Vendor Relations (Oct. 21)
  • Retailing (Oct. 22)
  • Manifesto (Oct. 23)
  • We continue our series sharing summaries of principles The Container Store follows to achieve its long-lasting success. These principles are detailed in the book, UNCONTAINABLE, written by Kip Tindell (co-founder, ceo and chairman, The Container Store).


    The Container Store Retailing Philosophy

    uncontainable_150Kip Tindell shares a great story in the book about a conversation he had with retailing pioneer Stanley Marcus of Neiman-Marcus fame. They were discussing the importance of a retail business having the right mix of products, service and price.

    Kip recalls the conversation…

    I loved to talk with Stanley Marcus about selection, service, and price. Stanley always said that if you do one of these things really well, you’ll be very successful. He said if you do any two of them well, you’ll have the number one business in your niche. Then he said you can’t do all three because price is absolutely mutually exclusive to both selection and service.”

    The best products with the best service at the best possible price is nearly impossible to do.

    Zappos can lay claim to selling the best products with the best customer service but not at the lowest price.

    Costco competes brilliantly on selling products at a very low price but that comes at a cost. They do not have the best selection nor do they have the best customer service.

    The Container Store would love to, in Kip’s words, “… hit the triple crown every day—offering a well-edited, carefully curated collection of 10,000 products, free expert advice and service that customers delight in, and prices competitive with the mass merchants.” But they can’t.

    The Container Store can deliver the best products with the best customer service, but not at the best price.

    As a former retail marketer for Whole Foods and Starbucks, I know firsthand the struggles dealing with price perception issues. Whole Foods especially struggles with the perception its prices are too high. It’s true that one can buy cheaper natural/organic food elsewhere and one can buy a cheaper latte from someplace other than Starbucks. However, Whole Foods and Starbucks have found retail success by not competing on lowest prices.

    I really like Kip’s perspective on a retailer competing with higher prices. Kip writes…

    We’re not the only retailer that gets an unfair reputation when it comes to price. But it’s the retailers that focus solely on price that get the credit for great pricing. And it’s surprising to me how overcredited discounters are for pricing and how unfairly retailers who focus on service and quality are marked as overpriced.”

    The Container Store, Starbucks and Whole Foods all suffer from being known as too pricey. However, these higher prices result in better products with better customer service. If I’m starting a retail business, I’d focus on delivering better products and service. Yes, prices will be higher but the overall experience will be richer.


    The Container Store posting series:

  • Hiring (Oct. 13)
  • Training (Oct. 14)
  • Selling (Oct. 15)
  • Leadership (Oct. 20)
  • Vendor Relations (Oct. 21)
  • Retailing (Oct. 22)
  • Manifesto (Oct. 23)
  • We continue our series sharing summaries of principles The Container Store follows to achieve its long-lasting success. These principles are detailed in the book, UNCONTAINABLE, written by Kip Tindell (co-founder, ceo and chairman, The Container Store).


    The Container Store Vendor Relations Philosophy

    uncontainable_150

    Kip Tindell gives credit to the strong vendor relationships The Container Store has developed as a major reason the company has thrived for three decades.

    In the early days of the company, The Container Store worked with other mom and pop shops. These small vendors were accustomed to big box retailers making demands and dictating how the vendor/retailer relationship would work. Kip recalls how these small vendors were astonished when The Container Store took a genuine interest in their success.

    The Container Store takes the time to understand the needs of it vendors and works directly with them to form a mutually beneficial relationship.

    The Elfa closet shelving system is the best-selling product at The Container Store. It’s a product Kip recalls as being very challenging to sell because it’s difficult to understand how to use it. However, once you learn how to use it, it becomes a simply elegant way to organize a closet. Other retailers refused to sell the Elfa product because it would require too much employee training. The Container Store didn’t shy away from the employee training needed and embraced the Elfa product to the degree that it is by far its most popular product.

    The Elfa brand and business would never have been realized if The Container Store didn’t develop a strong vendor/retailer relationship. This strong relationship resulted in Elfa being purchased by The Container Store in 1999.

    Most of the products sold in The Container Store are either proprietary or exclusive. This truly requires a strong vendor/retailer relationship where The Container Store needs to understand how these vendors define success so that everyone wins.

    With its runaway success, The Container Store saw lots of competitors trying to mimic it business. Local, regional and national chains have all tried to replicate The Container Store business model. None have been able to find the same success and most of these competitors have ceased to exist.

    Why didn’t these competitors successfully knockoff The Container Store?

    Kip Tindell rightfully believes, “You can copy a company two-dimensionally, but you can’t copy its heart and soul. That, to me, is the key. No one wants to build a business that’s so hiring- and training- and people-intensive. That’s usually the last thing people want to deal with in business.


    The Container Store posting series:

  • Hiring (Oct. 13)
  • Training (Oct. 14)
  • Selling (Oct. 15)
  • Leadership (Oct. 20)
  • Vendor Relations (Oct. 21)
  • Retailing (Oct. 22)
  • Manifesto (Oct. 23)
  • We continue our series sharing summaries of principles The Container Store follows to achieve its long-lasting success. These principles are detailed in the book, UNCONTAINABLE, written by Kip Tindell (co-founder, ceo and chairman, The Container Store).


    The Container Store Leadership Philosophy

    uncontainable_150The company culture at The Container Store is based upon communicating everything with everyone. Employees, according to Kip Tindell, feel included when everything is communicated with them. Kip delivers the same updates to the company’s board of directors as he does to employees. The only topic that’s off limits are salaries, everything else is discussable.

    Kip compares a business to a football team. Players on the football team need to know the score and need to know what the other players are doing, why they are doing it and where they are doing it. If one player doesn’t know what the other players are doing, a football team is sure to lose.

    Same goes for a business and at The Container Store, the leadership mindset is one of sharing as much information as possible to all levels of employees. Sales numbers and goals are shared every day with all employees for their store and for other stores in the region.

    Melissa Reiff (president, The Container Store) sums up the importance of communication to employees this way, “We must practice consistent, reliable, predictable, effective, thoughtful, compassionate, and even, yes, courteous communication every single day to successfully sustain, develop, and grow our business.”

    Instead of operating on a “need to know” basis, The Container Store follows a “must know” communication philosophy with employees. The company knows its employees will benefit from having more information because it will help them to do a better job, become a better employee and lead The Container Store to future success.


    The Container Store posting series:

  • Hiring (Oct. 13)
  • Training (Oct. 14)
  • Selling (Oct. 15)
  • Leadership (Oct. 20)
  • Vendor Relations (Oct. 21)
  • Retailing (Oct. 22)
  • Manifesto (Oct. 23)
  • We continue our series sharing summaries of principles The Container Store follows to achieve its long-lasting success. These principles are detailed in the book, UNCONTAINABLE, written by Kip Tindell (co-founder, ceo and chairman, The Container Store).


    The Container Store Selling Philosophy

    At The Container Store, we don’t immediately try to sell something to a customer; we can’t, because we don’t know enough about her yet. We simply start a conversation first, to open the door a bit, and earn her trust so we can begin exploring how to help her.” – Kip Tindell, The Container Store

    uncontainable_150The selling philosophy at The Container Store is known inside the company as “Man in the Desert Selling.” This sales approach involves uncovering customer needs and they use an analogy of a man in the desert to explain it.

    A “Man in the Desert” obviously needs water. But that’s not all he needs. Most retailers stop with solving the obvious customer need. Just like a Man in the Desert needs things beyond water like, shade, shoes, sunglasses, clothing, etc., customers have other needs than their obvious need. The Container Store trains its employees to uncover unmet and unknown customer needs.

    The Container Store employees are trained to (a) make an Approach, (b) establish a Connection and (c) close the Sale.

    As the earlier quote from Kip Tindell says, employees at The Container Store open the door to a potential sale by initiating a conversation with a customer. Instead of using throwaway lines like, “Can I help you?” employees are taught to use an Approach that is more conversational. Such as, “That’s a nice coat you have on.” Or, employees will see a customer holding a product and react by saying, “Let’s take this out of the box and I’ll show you how it works.”

    After the Approach, employees make a Connection by asking helpful questions, such as: What space needs organizing in your house? How big is the space? Who in the family uses the space?

    According to Kip Tindell, “… the Sale comes when we devise a solution that makes the customer excited about conquering a problem in a way she probably never would have imagined on her own (after all, she’s not the storage and organization expert—we are).”


    The Container Store posting series:

  • Hiring (Oct. 13)
  • Training (Oct. 14)
  • Selling (Oct. 15)
  • Leadership (Oct. 20)
  • Vendor Relations (Oct. 21)
  • Retailing (Oct. 22)
  • Manifesto (Oct. 23)
  • We continue our series sharing summaries of principles The Container Store follows to achieve its long-lasting success. These principles are detailed in the book, UNCONTAINABLE, written by Kip Tindell (co-founder, ceo and chairman, The Container Store).


    The Container Store Employee Training Philosophy

    uncontainable_150The Container Store trusts its employees to make meaningful connections with customers and to share their organizational expertise at every opportunity with customers. This trust comes from knowing they’ve hired great employees and trained them well.

    Astonishingly, full-time employees at The Container Store receive close to 300 hours of paid training in their first year. Read that again… nearly 300 hours of paid training. Not 30 hours, but 300 hours. Part-time employees get almost 200 hours of training and no employee gets put on the sales floor without first receiving 40 hours of training.

    That’s a major commitment to training. A commitment very few retailers have the courage to do.

    The Container Store training philosophy is about building an employee’s intuition muscles.

    Kip Tindell explains it this way, “We want our employees to use their intuition—their wonderful life experience—to anticipate the needs of our customers and to recommend the appropriate solutions.

    All the training employees receive prepares their mind to handle most any situation at the store level. It also prepares employees with product knowledge and organization expertise that helps them to explain to customers some of the complicated products The Container Store sells.

    As it relates to training employees, Kip Tindell stresses its importance by saying…

    One reason training is more important at The Container Store than at other retailers is because our motto is ‘We sell the hard stuff.’ We actually tell our buyers to look for products that are hard to sell. Why? Because we know other retailers won’t touch those products, giving us an exclusive and yet another reason for customers to shop with us.

    Let’s revisit the nearly 300 hours of training full-time employees receive at The Container Store. How can a retailer justify such an outrageous expense?

    For The Container Store, training employees so well results in a turnover rate of less than 10%, which saves the company millions of dollars in recruiting, interviewing, hiring and training people. And since they sell complicated products, vendors can trust employees at The Container Store to tell the story and purpose behind each of the products sold in the store.


    The Container Store posting series:

  • Hiring (Oct. 13)
  • Training (Oct. 14)
  • Selling (Oct. 15)
  • Leadership (Oct. 20)
  • Vendor Relations (Oct. 21)
  • Retailing (Oct. 22)
  • Manifesto (Oct. 23)
  • uncontainable_150One of the most successful retail businesses that grew from a single shop into a much loved and highly profitable multi-unit concept is The Container Store.

    The business began in 1978 by selling all sorts of boxes, bins and doodads to help people organize all their stuff. Today, they have grown to 60 locations all over the United States with revenues around $750 million.

    The Container Store is a classic category killer concept that has carved a niche in the retail world by following seven foundation principles. Kip Tindell, co-founder and ceo of The Container Store, has finally published a book detailing the principles behind the success of The Container Store.

    Over the next two weeks, the Brand Autopsy blog will be sharing summaries of each principle The Container Store follows to achieve its long-lasting success. We’ll address important retail business matters from hiring to training to leadership to vendor relations.

    Let’s start with The Container Store hiring philosophy…

    1 Great Person equals 3 Good People

    Finding great employees isn’t easy for any business. It helps to have the reputation The Container Store has to attract great employees. Many people want to work there, but less than 3.0% of the people who apply to become front-line employees at The Container Store get hired. Once hired, people rarely leave. The Container Store enjoys an unheard of store-level employee turnover rate of less than 10%.

    One of the long-standing hiring principles practiced by The Container Store is 1=3. As in, one great employee will do the work of three good people.

    The company is very selective in whom they choose to hire. They strive to hire only GREAT employees and they pay them well. The typical full-time frontline salesperson at the Container Store makes nearly $50,000 a year, that’s about double the industry average. Payroll as a percentage of sales at the store level is 11.5%. That’s high, much higher than most retailers would dare to do.

    Kip Tindell explains why paying employees more works…

    Our approach to payroll is easy to justify because we are convinced that our 1=3 approach really works. Our employee wins, because she is making far more than anyone else than another company is likely to pay her for that position. The Container Store wins, because it gets three times the productivity at only 50 to 100 percent more the cost. And the customer wins because they have this superb salesperson who actually cares about working in the store.”

    The Container Store believes it can pay its employees twice as much and still come out ahead because one great employee is as productive as three good employees.

    It’s not easy to get hired by The Container Store. The interview process is time-consuming. It begins with an online application. A phone interview is next for those that make the initial cut. From there, candidates are given a homework assignment and brought in for a group interview. Then, a variety of one-on-one personal interviews take place. This entire process takes time but The Container Stores takes this time in order to find GREAT employees.

    Hiring the right employees and paying them well is at the center of The Container Store’s success. Kip Tindell believes, “When you surround yourself with hugely talented, passionate, dedicated, and genuinely kind people, you will succeed in whatever you do—there’s no doubt in my mind about that.


    The Container Store posting series:

  • Hiring (Oct. 13)
  • Training (Oct. 14)
  • Selling (Oct. 15)
  • Leadership (Oct. 20)
  • Vendor Relations (Oct. 21)
  • Retailing (Oct. 22)
  • Manifesto (Oct. 23)