Brian Niccol is all set to step into his new role as Starbucks's CEO on September 9. As he takes over the charge, his top priority will be addressing the ongoing glitches in the company's mobile application. Former CEO Howard Schultz, who remains involved with the coffee giant, has labelled the application as Starbucks' "Achilles heel" on an episode of the 'Acquired' podcast in June. This issue has weakened the brand image of the company and has caused immense operational inefficiencies related to same-store sales.&nbsp;

Mobile orders now represent nearly a third of Starbucks' sales, but this dependence has brought significant challenges. The surge in digital orders often leads to longer wait times, overwhelming baristas and frustrating customers. What was designed to enhance convenience has, in many cases, disrupted the in-store customer experience, driving away patrons who find the process more stressful and demanding than satisfying.&nbsp;

Former CEO Howard Schultz, who was involved in positioning Starbucks as a "third place" between work and home, witnessed these issues first-hand during a random visit to a Chicago store. He observed overcrowded counters, long lines, delays and a chaotic atmosphere that completely contrasted with the welcoming, community-oriented environment that Starbucks was once known for. The convenience of digitally ordering through a mobile, while beneficial for on-the-go customers, has unintentionally compromised the brand's core value of creating a calm and relaxed social space.&nbsp;

This operational strain not only affects the overall customer experience but also places immense pressure on baristas, leading to burnout and dissatisfaction. As Starbucks looks to the future, addressing these significant challenges will be crucial. Incoming CEO Brian Niccol faces the task of refining and rejuvenating the mobile ordering process to bring down wait time and restore the flow between digital convenience and the in-store experience that made Starbucks an adored destination.&nbsp;

Brian Niccol brings talent and experience to the table&nbsp;

Niccol brings invaluable experience from his time at Chipotle, where he successfully dealt with similar challenges by simplifying digital orders and optimizing operations. At Chipotle, a dedicated digital order preparation line and the introduction of drive-through lanes for online pickups termed "Chipotlanes" immensely helped the company impactfully manage its booming digital sales.&nbsp;

Steps taken by Starbucks to deal with the problem&nbsp;

Starbucks has started implementing fundamental changes to tackle these challenges, including new technological equipments and the upgradation of mobile applications. Still, the rollout has been sluggish with only 40 percent of North American stores anticipated to receive the new equipment by 2026.&nbsp;

Brian will have to accelerate these efforts to restore Starbucks' reputation and boost sales to generate higher revenue. Reducing customer wait times and making the process seamless will go a long way in alleviating the strain on baristas. If he can convincingly deal with these pressing issues, he's likely to gain the trust of investors and customers alike, placing Starbucks in for a successful turnaround.

Brian Niccol is all set to step into his new role as Starbucks's CEO on September 9. As he takes over the charge, his top priority will be addressing the ongoing glitches in the company's mobile application.

Brian Niccol is all set to step into his new role as Starbucks's CEO on September 9. As he takes over the charge, his top priority will be addressing the ongoing glitches in the company's mobile application. Former CEO Howard Schultz, who remains involved with the coffee giant, has labelled the application as Starbucks' "Achilles heel" on an episode of the 'Acquired' podcast in June. This issue has weakened the brand image of the company and has caused immense operational inefficiencies related to same-store sales. Mobile orders now represent nearly a third of Starbucks' sales, but this dependence has brought significant challenges. The surge in digital orders often leads to longer wait times, overwhelming baristas and frustrating customers. What was designed to enhance convenience has, in many cases, disrupted the in-store customer experience, driving away patrons who find the process more stressful and demanding than satisfying. Former CEO Howard Schultz, who was involved in positioning Starbucks as a "third place" between work and home, witnessed these issues first-hand during a random visit to a Chicago store. He observed overcrowded counters, long lines, delays and a chaotic atmosphere that completely contrasted with the welcoming, community-oriented environment that Starbucks was once known for. The convenience of digitally ordering through a mobile, while beneficial for on-the-go customers, has unintentionally compromised the brand's core value of creating a calm and relaxed social space. This operational strain not only affects the overall customer experience but also places immense pressure on baristas, leading to burnout and dissatisfaction. As Starbucks looks to the future, addressing these significant challenges will be crucial. Incoming CEO Brian Niccol faces the task of refining and rejuvenating the mobile ordering process to bring down wait time and restore the flow between digital convenience and the in-store experience that made Starbucks an adored destination. Brian Niccol brings talent and experience to the table Niccol brings invaluable experience from his time at Chipotle, where he successfully dealt with similar challenges by simplifying digital orders and optimizing operations. At Chipotle, a dedicated digital order preparation line and the introduction of drive-through lanes for online pickups termed "Chipotlanes" immensely helped the company impactfully manage its booming digital sales. Steps taken by Starbucks to deal with the problem Starbucks has started implementing fundamental changes to tackle these challenges, including new technological equipments and the upgradation of mobile applications. Still, the rollout has been sluggish with only 40 percent of North American stores anticipated to receive the new equipment by 2026. Brian will have to accelerate these efforts to restore Starbucks' reputation and boost sales to generate higher revenue. Reducing customer wait times and making the process seamless will go a long way in alleviating the strain on baristas. If he can convincingly deal with these pressing issues, he's likely to gain the trust of investors and customers alike, placing Starbucks in for a successful turnaround.

New Starbucks CEO Brian Niccol Must Fix the Chain's Mobile App Problem

Former Starbucks CEO Howard Schultz is lining up against a potential settlement between the coffee giant and activist investor Elliott Investment Management, the Financial Times reported. In a $2.03 billion stake at Starbucks, Schultz holds the company's sixth-largest shares. He expressed his misgivings to board members, the report said, citing sources familiar with the matter.

Elliott has built a sizable stake in Starbucks and, in recent days, has been discussing ways of improving the coffee chain's stock performance, sources familiar with the matter told Reuters last week. The coffee chain would not comment on the report, while Schultz and Elliott did not immediately respond to requests from Reuters for comment.

Schultz, who left the board of Starbucks last year, transformed what was essentially a small whole-bean business into an international coffee house chain operating more than 36,000 stores in 86 markets. He stepped down as CEO in 2023 after returning for a third term to steer the company.

Following a disappointing quarterly earnings report in April, Schultz took to LinkedIn to signal that Starbucks must overhaul its US operations. Elliott, which won board seats at Etsy, Phillips 66, and Match, in the first half of 2024, is also currently pressuring Southwest Airlines for changes. The hedge fund, managing $65.5 billion in assets as of December, also launched campaigns at Texas Instruments and Johnson Controls earlier this year.

Shares of Starbucks, down nearly 23 per cent this year, edged higher in extended trading on Friday.

This standoff between Schultz and Elliott epitomises the internal rifts underway inside Starbucks as it faces activist pressure. The resistance that Schultz offers to the settlement underlines his remaining influence and deep apprehension for the future course of the company, a resolution of this dispute being of prime importance from the future strategy and investor confidence point of view.

Former Starbucks CEO Howard Schultz is lining up against a potential settlement between the coffee giant and activist investor Elliott Investment Management, the Financial Times reported.

Former Starbucks CEO Howard Schultz is lining up against a potential settlement between the coffee giant and activist investor Elliott Investment Management, the Financial Times reported. In a $2.03 billion stake at Starbucks, Schultz holds the company's sixth-largest shares. He expressed his misgivings to board members, the report said, citing sources familiar with the matter. Elliott has built a sizable stake in Starbucks and, in recent days, has been discussing ways of improving the coffee chain's stock performance, sources familiar with the matter told Reuters last week. The coffee chain would not comment on the report, while Schultz and Elliott did not immediately respond to requests from Reuters for comment. Schultz, who left the board of Starbucks last year, transformed what was essentially a small whole-bean business into an international coffee house chain operating more than 36,000 stores in 86 markets. He stepped down as CEO in 2023 after returning for a third term to steer the company. Following a disappointing quarterly earnings report in April, Schultz took to LinkedIn to signal that Starbucks must overhaul its US operations. Elliott, which won board seats at Etsy, Phillips 66, and Match, in the first half of 2024, is also currently pressuring Southwest Airlines for changes. The hedge fund, managing $65.5 billion in assets as of December, also launched campaigns at Texas Instruments and Johnson Controls earlier this year. Shares of Starbucks, down nearly 23 per cent this year, edged higher in extended trading on Friday. This standoff between Schultz and Elliott epitomises the internal rifts underway inside Starbucks as it faces activist pressure. The resistance that Schultz offers to the settlement underlines his remaining influence and deep apprehension for the future course of the company, a resolution of this dispute being of prime importance from the future strategy and investor confidence point of view.

Starbucks faces internal conflict as Howard Schultz opposes Elliott settlement

US Senator Bernie Sanders is continuing to push for Starbucks' interim Chief Executive Officer Howard Schultz to testify at a Senate hearing on the company's compliance with labour law.

Schultz is set to step down later this month, but Sanders has refused to back down on calls to have him testify at the hearing scheduled for March 9.

Starbucks has reiterated that it has no plans to send Schultz to the hearing, prompting Sanders to say that he was "shocked and deeply concerned".

He added that the vote on whether to issue a subpoena for Schultz to appear will go ahead on March 8.

In a letter to Starbucks, Sanders argued that Schultz is the founder, CEO, and spokesperson of the company, and has made it clear that he is the driving force of labour policy at Starbucks.

The company, however, has argued that Schultz is not the right witness to address workforce matters raised by the committee, stating that its Chief Communications and Public Affairs Officer AJ Jones is best positioned to do so.

Moreover, Starbucks has offered to send acting executive vice president and general counsel Zabrina Jenkins and vice president for partner and labour relations May Jensen.

The Senate hearing follows Democratic senators' accusations that Starbucks did not conduct fair conversations with workers who were considering joining labour unions.

Since 2021, employees in over 280 of the company's 9,000 company-operated US sites have chosen to join a union.

The union wants greater wages and benefits, better health and safety standards, and safeguards against arbitrary discipline and dismissal.

Starbucks has denied the allegations and stated that it respects the right of its employees to take part in legitimate union-related activities.

The Senate committee will also decide whether to give the panel the power to look into any labour law infractions by several other big businesses.

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US Senator Bernie Sanders is continuing to push for Starbucks' interim Chief Executive Officer Howard Schultz to testify at a Senate hearing on the company's compliance with labour law.

US Senator Bernie Sanders is continuing to push for Starbucks' interim Chief Executive Officer Howard Schultz to testify at a Senate hearing on the company's compliance with labour law. Schultz is set to step down later this month, but Sanders has refused to back down on calls to have him testify at the hearing scheduled for March 9. Starbucks has reiterated that it has no plans to send Schultz to the hearing, prompting Sanders to say that he was "shocked and deeply concerned". He added that the vote on whether to issue a subpoena for Schultz to appear will go ahead on March 8. In a letter to Starbucks, Sanders argued that Schultz is the founder, CEO, and spokesperson of the company, and has made it clear that he is the driving force of labour policy at Starbucks. The company, however, has argued that Schultz is not the right witness to address workforce matters raised by the committee, stating that its Chief Communications and Public Affairs Officer AJ Jones is best positioned to do so. Moreover, Starbucks has offered to send acting executive vice president and general counsel Zabrina Jenkins and vice president for partner and labour relations May Jensen. The Senate hearing follows Democratic senators' accusations that Starbucks did not conduct fair conversations with workers who were considering joining labour unions. Since 2021, employees in over 280 of the company's 9,000 company-operated US sites have chosen to join a union. The union wants greater wages and benefits, better health and safety standards, and safeguards against arbitrary discipline and dismissal. Starbucks has denied the allegations and stated that it respects the right of its employees to take part in legitimate union-related activities. The Senate committee will also decide whether to give the panel the power to look into any labour law infractions by several other big businesses. WATCH WION LIVE HERE

Starbucks CEO may have to testify before the US Senate

Longtime Starbucks chief Howard Schultz will return to the helm of the global coffee shop chain, the company announced Wednesday, serving as interim CEO while the company searches for a new leader amid a growing unionization drive.

Kevin Johnson, who has led the coffee giant since 2017, plans to retire next month, the company said, adding it expects to name a new CEO by the fall.&nbsp;

Schultz, 68, who first joined the company in 1982, grew Starbucks from a small Seattle coffee chain into a global juggernaut in two earlier stints as chief executive.&nbsp;

He also flirted with running for the US presidency in 2020, but ultimately opted against seeking office. His real-time wealth was valued at $4 billion on Wednesday, according to a Forbes list of the richest people in the world.

"When you love something, you have a deep sense of responsibility to help when called," Schultz said. "Although I did not plan to return to Starbucks, I know the company must transform once again to meet a new and exciting future where all of our stakeholders mutually flourish."&nbsp;

Shares of the coffee chain rocketed higher Wednesday, even as union leaders expressed misgivings about Schultz.

'Reputational risk'

With more than 34,000 stores worldwide, Starbucks reported a record $29.1 billion in annual revenues last year but has struggled of late to manage rising costs amid a tight labor market and supply chain problems.

Besides inflation, which is a headwind challenging companies throughout the economy, Starbucks is confronting a growing wave of unionization campaigns that has spread to more than 100 US stores after workers at two upstate New York cafes voted to form a union in December.

Johnson, 61, told the board a year ago that he was considering retiring in the wake of the upheaval of the pandemic, calling the decision "a natural bookend to my 13 years with the company," according to the company press release.

Starbucks said it had enlisted recruitment firm Russell Reynolds Associates in "continuous CEO succession planning" since 2021. Johnson plans to work as a consultant to the company through September.

The union movement poses challenges for the chain, which has been viewed as a worker-friendly company by many political progressives in the United States given its stance on gay marriage, race relations, the environment and other issues.

But Starbucks' tactics to discourage workers from unionization poses "reputational risk," shareholder activists argued in a letter sent to Johnson and Starbucks Chair Mellody Hobson ahead of the company's annual meeting later Wednesday.

Highlighting "alleged retaliatory termination and continued captive audience meetings," the shareholder group urged Starbucks to "publicly commit to a global policy of neutrality," said Trillium Asset Management, Parnassus Investments and other Starbucks shareholders who manage some $3.4 trillion in assets.

Looking externally

News of Schultz' return drew a cool response from Starbucks Workers United, which referred to the executive as a "leader in Starbucks' anti-union campaign," and urged him "to put union-busting behind him."

Ahead of the union vote, Schultz visited Buffalo in November to try to persuade workers against voting for the group.

In a letter to workers titled "From Buffalo with love," Schultz highlighted Starbucks' benefits for workers, including health care and free college tuition, saying he was "saddened and concerned" that workers felt outside representation was needed.

But staff at two Buffalo cafes voted with Starbucks Workers United on December 9. Since then, additional Buffalo-area shops have also voted with the group, along with a cafe in Mesa, Arizona, while employees at dozens more are working to form a union.

Equity analysts at investment firm Cowen said they were "a bit surprised" that Starbucks was searching for external CEO candidates, naming a number of high-ranking executives who could have taken over.

"We note a strong internal bench, but believe unionization publicity could be a factor pushing the company to look externally," Cowen said in a note.

Shares of Starbucks jumped 5.4 percent to $87.61 in afternoon trading.

Longtime Starbucks chief Howard Schultz will return to the helm of the global coffee shop chain, the company announced Wednesday, serving as interim CEO while the company searches for a new leader amid a growing unionization drive.

Longtime Starbucks chief Howard Schultz will return to the helm of the global coffee shop chain, the company announced Wednesday, serving as interim CEO while the company searches for a new leader amid a growing unionization drive. Kevin Johnson, who has led the coffee giant since 2017, plans to retire next month, the company said, adding it expects to name a new CEO by the fall. Schultz, 68, who first joined the company in 1982, grew Starbucks from a small Seattle coffee chain into a global juggernaut in two earlier stints as chief executive. He also flirted with running for the US presidency in 2020, but ultimately opted against seeking office. His real-time wealth was valued at $4 billion on Wednesday, according to a Forbes list of the richest people in the world. "When you love something, you have a deep sense of responsibility to help when called," Schultz said. "Although I did not plan to return to Starbucks, I know the company must transform once again to meet a new and exciting future where all of our stakeholders mutually flourish." Shares of the coffee chain rocketed higher Wednesday, even as union leaders expressed misgivings about Schultz. 'Reputational risk' With more than 34,000 stores worldwide, Starbucks reported a record $29.1 billion in annual revenues last year but has struggled of late to manage rising costs amid a tight labor market and supply chain problems. Besides inflation, which is a headwind challenging companies throughout the economy, Starbucks is confronting a growing wave of unionization campaigns that has spread to more than 100 US stores after workers at two upstate New York cafes voted to form a union in December. Johnson, 61, told the board a year ago that he was considering retiring in the wake of the upheaval of the pandemic, calling the decision "a natural bookend to my 13 years with the company," according to the company press release. Starbucks said it had enlisted recruitment firm Russell Reynolds Associates in "continuous CEO succession planning" since 2021. Johnson plans to work as a consultant to the company through September. The union movement poses challenges for the chain, which has been viewed as a worker-friendly company by many political progressives in the United States given its stance on gay marriage, race relations, the environment and other issues. But Starbucks' tactics to discourage workers from unionization poses "reputational risk," shareholder activists argued in a letter sent to Johnson and Starbucks Chair Mellody Hobson ahead of the company's annual meeting later Wednesday. Highlighting "alleged retaliatory termination and continued captive audience meetings," the shareholder group urged Starbucks to "publicly commit to a global policy of neutrality," said Trillium Asset Management, Parnassus Investments and other Starbucks shareholders who manage some $3.4 trillion in assets. Looking externally News of Schultz' return drew a cool response from Starbucks Workers United, which referred to the executive as a "leader in Starbucks' anti-union campaign," and urged him "to put union-busting behind him." Ahead of the union vote, Schultz visited Buffalo in November to try to persuade workers against voting for the group. In a letter to workers titled "From Buffalo with love," Schultz highlighted Starbucks' benefits for workers, including health care and free college tuition, saying he was "saddened and concerned" that workers felt outside representation was needed. But staff at two Buffalo cafes voted with Starbucks Workers United on December 9. Since then, additional Buffalo-area shops have also voted with the group, along with a cafe in Mesa, Arizona, while employees at dozens more are working to form a union. Equity analysts at investment firm Cowen said they were "a bit surprised" that Starbucks was searching for external CEO candidates, naming a number of high-ranking executives who could have taken over. "We note a strong internal bench, but believe unionization publicity could be a factor pushing the company to look externally," Cowen said in a note. Shares of Starbucks jumped 5.4 percent to $87.61 in afternoon trading.

Howard Schultz returns to Starbucks as interim leader, Johnson exits

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New Starbucks CEO Brian Niccol Must Fix the Chain's Mobile App Problem

Starbucks faces internal conflict as Howard Schultz opposes Elliott settlement

Starbucks CEO may have to testify before the US Senate

Howard Schultz returns to Starbucks as interim leader, Johnson exits