Excerpt from Fortune Magazine March 19 issue 2007

America's Most Admired Companies

Howard Schultz
Chairman, Starbucks

In the winter of 1961, a seven-year-old Schultz was throwing snowballs with friends outside his family's apartment building in the federally subsidized Bay View Housing Project in Brooklyn.  "Howard, come inside," his mother yelled down from their seventh floor apartment.  "Dad had an accident."  What followed would shape him for the rest of his life.  He found his father in a full leg cast, sprawled on the living room couch.  While working as a delivery driver, Schultz father had fallen on a sheet of ice and broken his ankle.  As a result, he lost his job-and the family health-care benefits.  Schultz's mother could not go to work because she was seven months pregnant.  The family had nothing to fall back on.  Many evenings Schulz listen to his parents argue at the dinner table about how much money they needed to borrow.  If the phone rang, his mother asked Howard to answer it and tell the bill collectors of his parents were at home.  "I was surrounded by people who are working hand to mouth trying to pay the bills, who felt like there was no hope and they just couldn't get a break.  That's something that never leaves you-never."

Both Schulz is mother constantly urged him to make something of a more of his life, his past influences whole approach to shaping-and leading-a company.  "I wanted to build the kind of company my father never had a chance to work for," he says.  After attending Northern Michigan University on a football scholarship-he was the first person in his family to earn a college degree-Schulz landed at Xerox.  But the environment there was too bureaucratic for him.  IIn a new job selling coffee brewers, he discovered a tiny coffee retailer in Seattle's Pike Place market he campaigned to join the retailer, became its director of retail operations and marketing and eventually raise enough money to buy the six chain store.

Under Schultz's leadership, Starbucks extended its benefits to provide access to health care coverage for qualified employees who work as little as 20 hours a week.  "Offering healthcare created unbelievable trust with our people," says Schultz, who spent 13 years as CEO of Starbucks and is now chairman.  Today Starbucks has more than 145,000 people, all of whom earn more than the minimum wage, receive stock options, and get other benefits his father never saw.  "Starbucks is the quintessential people based business," he says.  "Everything we do is about humanity."

 

Economic Vision

Howard Schultz

Howard Schultz