The Wall Street Journal reports that the US House of Representatives Committee on Education and the Workforce has issued a subpoena to the National Labor Relations Board (NLRB) as it looks into whether the labor body improperly influenced at least one Starbucks election.
According to the story, "Rep. Virginia Foxx (R-North Carolina), who chairs the committee, wrote that she believes the NLRB has communications and documents outlining alleged misconduct in Starbucks elections, and is seeking documents on the matter. Ms. Foxx requested that the NLRB official provide the documents to the committee on March 29, according to the subpoena … Ms. Foxx wrote that she believes that an NLRB report last month confirmed certain allegations brought forward by Starbucks last year, particularly regarding an election in the Kansas City area. Ms. Foxx wrote in the letter that NLRB employees shared more information about the election with Workers United than with Starbucks, thereby helping the union."
The Journal says that the NLRB and Starbucks Workers United have not yet commented on the subpoena. Starbucks management said it welcomed the move.
The Journal writes that "as Starbucks has pushed back against a unionization drive in its U.S. cafes over the past 18 months, Starbucks Workers United has filed hundreds of unfair labor practice charges against Starbucks, and the NLRB has issued more than 80 complaints against the company covering roughly 260 of those allegations. Starbucks is contesting those charges."
There were two other Starbucks stories that were posted this morning:
• Bloomberg reports that as Laxman Narasimhan takes the CEO reins from Howard Schultz this week, "unionized Starbucks baristas plan to welcome their new chief executive officer with strikes at about 100 cafes Wednesday, demanding that the company drop its alleged antiunion coercion.
"The work stoppage, which organizers said will involve stores in more than 40 US cities, is the union Starbucks Workers United’s latest effort to force a pivot by the coffee giant. Since scoring an initial landmark victory 15 months ago in Buffalo, New York, the union has prevailed in elections at around 290 of the company’s roughly 9,000 corporate-owned US cafes. But the pace of new unionization petitions has slowed down, as workers allege the company has been retaliating in stores and stonewalling them at the bargaining table."
• And, in a profile of Narasimhan, the Journal makes several points about his planned approach to leadership of the company.
First, he says that he is the CEO. Not Schultz. While he will turn to Schultz for guidance, "The world, though, needs boxes and lines. There’s one CEO, and that’s me."
Second, he plans to put a lot of focus on supply chain issues. For example, after spending six months immersing himself in the system, he found that Starbucks has too many different cup and lid pairings. “It was startling to me, how many we had,” he said. “We’ve got things to do to become more disciplined.”
And third, "Narasimhan said he plans to regularly work alongside baristas in cafes to understand why it sometimes is so aggravating to get a customer a simple cup of coffee. He intends to work four hours in a different Starbucks store each month, and expects his senior leaders to do the same."
- KC's View:
It is fair, I think, to say that many of Starbucks' problems are related to a disconnect between management and the front lines. Forget the blame game, and which CEO is responsible. Management forgot that the company's brand equity entirely rests in its stores, and that had negative repercussions. (Schultz may have an unusually high profile for a CEO, but I would suggest that most Starbucks customers are far more familiar with their local barista.)
If Narasimhan can re-establish a culture in which the front lines are elevated in terms of importance and investment, that will be a step forward. And maybe even a lesson for other retailers at risk of disconnection from the front lines.