The Hot Iron

Tuesday, February 27, 2007

Seattle Turnarounds

There has been much talk about Starbucks’ founder Howard Schultz’s Valentine’s Day memo entitled “The Commoditization of the Starbucks Experience.” In short, he says that decisions made by the coffee chain in order to scale to its massive size, such as automatic espresso machines and putting beans in flavor-lock bags, have had a detrimental effect on the overall Starbucks experience.  Or as I take that, Starbucks stores are losing their mojo.

Will Starbucks be able to turn it around and return some of the magic to the experience of paying several dollars for a cup of coffee?  They can look to their neighbor in Redmond, Microsoft, for how to make a dramatic turnaround… from over a decade ago.  In the early 90’s Microsoft did not have an Internet strategy.  Within a year, they were able to turn it around, introducing the Internet Explorer browser and the Active Server Pages language, and take a lead in delivering Internet solutions.  Granted they licensed the Spyglass browser and remade it into IE, but they were able to go from nothing to something relatively quickly.  Not bad for the early 90’s.

Then again, maybe Microsoft should look to its past for some help itself.