The Wall Street Journal has a long story about how Laxman Narasimhan, CEO of Reckitt Benckiser Group PLC, will start off his tenure as CEO of Starbucks next month by serving as "incoming CEO" until April 2023, essentially shadowing current "interim CEO" Howard Schultz until then as he learns the ropes.
An excerpt from the story:
"Mr. Narasimhan is inheriting the position with the road map largely set by Mr. Schultz and other Starbucks executives through a strategic plan under way, and Mr. Schultz will retain a significant role at the company as a shareholder, board member and culture keeper … Over the coming months, Messrs. Narasimhan and Schultz said, the two are expected to travel across Starbucks’s markets, visiting stores and roasting plants to learn about the company’s operations and culture. By next April, Mr. Narasimhan is slated to take the reins from Mr. Schultz, who will remain on Starbucks’s board of directors."
This is Schultz's third go-round as CEO, as he how has returned twice to fix problems that he perceived as only being addressable by him.
In other Starbucks news, FYI, Bloomberg reports that the coffee retailer "is introducing benefits related to financial savings and student-loan debt for its US baristas, but only in non-union stores.
"The company says it isn’t allowed to give these new perks to staff at the roughly 300 stores where there’s been union activity." However, "Workers United, the group attempting to organize Starbucks cafes, has argued that the union waived its right to negotiate over extending benefits being provided to other stores, so there’s no legal obstacle to doing so."
Bloomberg writes that "the new benefits begin Sept. 19 … The savings program lets staff contribute a part of their after-tax pay to a personal savings account, with the company contributing $25 and $50 credits at milestones up to $250 per person. Starbucks workers will also have access to a new student-loan benefit with coaching on debt about repayment options and refinancing."
- KC's View:
To be honest, I am gobsmacked that Narasimhan essentially is going to spend six months before Starbucks and Schultz allow him to take control. He's basically going into the business equivalent of the Tour de France, and they're not ready to take off the training wheels.
Narasimhan, best I can tell, has precious little retailing experience. He may be really, really smart, and he may have lots of leadership/management experience in which he's excelled at innovation. But retailing, properly done, is a unique alchemy of art and science. It helps to be smart, but you also have to be able to emotionally connect to employees and customers. If you can't do both, you're screwed.
(Question: Despite his denials, could Schultz - who I think has an enormous messiah complex - already be engineering yet a third return to Starbucks's CEO job if Narasimhan doesn't work out? Scoff if you will, but I was predicting his second return before anyone else was.)
However, maybe Narasimhan's Reckitt experience can come in handy. After all, among Reckitt's brands are Lysol and Air Wick, both of which might come in handy in some of the Starbucks bathrooms I've been in lately. Perhaps he can get a deal.