Postcards

How the power players do it - by Fortune senior editor at large Patricia Sellers

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Starbucks' ex-CEO leads a new team

By Patricia Sellers February 28, 2012: 12:31 PM ET

It's a rare case when a Fortune 500 CEO gets ousted, and then the guy wearing the boot divvies out praise. But this is what happened after Howard Schultz fired Jim Donald as CEO of Starbucks (SBUX) and replaced him with himself. "You cannot meet a kinder human being," says Schultz about Donald in his book, Onward, about Starbucks' turnaround. "A natural talent for building relationships at every level of an organization"--plus "heart, conscience, and emotional intelligence," according to Schultz--made Donald a popular chief inside Starbucks, even as sales flagged and investors wanted change.

Turns out, Schultz was wise to reclaim Starbucks' reins in 2008 (Fortune named him 2011 Businessperson of the Year), but Donald, whom I've kept in touch with, seemed destined for another challenge. After four years below the radar--teaching, consulting, heading a Pacific Northwest grocery chain, Haggen--he was just named CEO of Extended Stay Hotels, a $1 billion-a-year, 9,100-employee chain that emerged from bankruptcy in 2010. The company is now owned by private equity firms Centerbridge Partners, Paulson & Co. and Blackstone Group (BX).

Hotels represent new territory for Donald, whose career has been in food retailing. (Hired by Sam Walton, he once spearheaded Wal-Mart's (WMT) early foray into superstores.) Now Donald is in stretch mode. Last month, as he was weighing various job options, he told me that he was testing his creative muscle by writing a story a day. He's written 13,000 words so far in 2012, he reports; most are about leading with love. "People want to know how they're doing," he says, summing up his philosophy. "If you let them know, then they might do more."

Donald believes that 99% of people "try to do the right thing. Recognize them for it." Here's his story about an encounter at Charlotte International Airport one January day when he was interviewing at Extended Stay's headquarters--now his corporate home.

Buy Some Love by Jim Donald, CEO, Extended Stay Hotels

Go ahead. Buy some love and make someone's day. It might even make your own day...

"Try the brownie brittle," Taquana told me as I checked out of Hudson News with the Wall Street Journal and USA Today.

"No thanks," I replied.

"You'll like it," she repeated. Giving in, I mumbled as I crunched, "Not bad. But I need to wash it down with some Bojangles fried chicken." Coincidentally, a Bojangles was across the terminal hallway.

"Take all of us with you," Taquana replied.

"Let's go. Lock this place down," I yelled to all six of the Hudson News employees (knowing it would not/could not happen).

As I walked across the hallway, I looked back at the excitement that I stirred up and got in line to place my order for a two-piece dinner--a wing and a breast.

All of a sudden, my conscience popped up on my right shoulder: "What the ???" she said to me. "All your working life, you tell people to 'celebrate the little things that people do to try and make a difference.' Taquana, probably in her first retail gig, went out of her way to sell you brownie brittle, and you not only stiffed her, you teased her as well."

Brushing Ms. Conscience off my shoulder, I said to myself, 'I don't even work here...leave me alone." As I thought about another reason to tell my conscience off, I was rudely interrupted by the cashier asking me, quite impatiently, "Your order, sir?"

"A two-piece dinner," I said, hesitating. "And a 12-piece box with biscuits, please," I added.

Walking back into Hudson News, I sang out loud (and annoyed a few customers along the way): "Show me some love 'cause I got the Chicken!" What happened next is something I didn't expect--and not only made my day but also reinforced the power of celebrating the little things that people do: Suddenly, I was surrounded by six women giving me my first group hug...15 seconds, 20 seconds 25 seconds...Now the customers were really getting upset.

As I broke free, said goodbye, and headed to Gate B9, airport security asked me if I was the one causing trouble. "Yeah," I replied. "Just ask my girls."

And as I sat down at the gate to eat my chicken, Taquana walked over and introduced her supervisor, who said, "Thanks." I said, "You should be thanking Taquana. She is making some things happen at your store!"

Donald looked for Taquana twice this past week--including today at 5:45 a.m. when he landed on the red-eye from Seattle. "Tell Taquana I'm in town," he told the crew at Hudson News.

Lululemon CEO Day tops Google's Larry Page

Since she arrived from Starbucks (SBUX) in 2008, Christine Day has done a remarkable job building Lululemon (LULU). Once just a retailer for yoga enthusiasts, Lululemon is now a fast-growing lifestyle brand. The stock has more than tripled in three years.

Day has never put herself in the spotlight, but Fortune's online readers clearly recognize how effective she is. The results of our just-released Businessperson of the Year poll show that MORE
Patricia Sellers - Nov 17, 2011 3:59 PM ET
Posted in: CEOs, Christine Day, consumer goods, Howard Schultz, Lululemon, Most Powerful Women, Postcards, Starbucks
Starbucks Via: What's the secret?

Hey, Starbucks lovers--and critics too! Have you taken the Starbucks Via Taste Challenge? The drip vs. instant coffee faceoff began this morning in Starbucks (SBUX) stores across North America.

If you want to know the science (it involves micro-grinding) behind Starbucks' new instant, check out this story today by my Fortune tech-writer colleague Michael Copeland. He talked with Andrew Linnemann, Starbucks' director of green coffee quality and operations, whose mission MORE
Patricia Sellers - Oct 2, 2009 1:23 PM ET
Posted in: Brands, consumer goods, Howard Schultz, Postcards, restaurants, retail, Starbucks
Starbucks CEO stakes out new grounds

Addendum: The Starbucks Via Taste Challenge kicks off Friday and runs through Monday in Starbucks stores across the U.S. and Canada. But I got a head start Tuesday morning, as I noted in the post below: I disagree with CEO Howard Schultz's "guarantee" that you won't be able to tell the difference between Starbucks' drip and its new instant (or "ready brew," as he calls it). Starbucks Bold drip handily MORE
Patricia Sellers - Sep 29, 2009 6:34 PM ET
Posted in: CEOs, consumer goods, Howard Schultz, Jim Donald, management, Postcards, Power Point, Power Shift, Starbucks
Advice for Starbucks, from readers

Tuesday's Guest Post by Starbucks barista Sun Min Kimes jolted Postcards readers like a pot of extra bold Joe. We got over 50 comments--the most comments, as well as the most traffic, of any Guest Post we've run except for "The Great Depression, as I remember" by Walt Stoiber.

She struck a chord. As one reader, Oliver in Chicago, said, "Move this person to the Executive suite ASAP!"

Thank you for the MORE
Patricia Sellers - Aug 6, 2009 3:55 PM ET
Posted in: Brands, CEOs, consumer goods, Howard Schultz, management, Postcards, restaurants, retail, Starbucks
Guest Post: Advice to Starbucks CEO Howard Schultz

Starbucks (SBUX) is one of our favorite topics on Postcards. We're in the stores everyday. We vigilantly watch CEO Howard Schultz's efforts to slash costs, revive the brand, treat employees respectfully, satisfy investors, and fight incursions by very aggressive McDonald's (MCD) and Dunkin' Donuts. Today's Wall Street Journal has an interesting story about Starbucks' latest efficiency efforts--which could compromise the brand "romance," which Schultz has long said distinguishes Starbucks, and MORE
Patricia Sellers - Aug 4, 2009 1:11 PM ET
Posted in: Brands, CEOs, consumer goods, Guest Post, Howard Schultz, management, McDonald's, Postcards, restaurants, retail, Starbucks
Guest Post: Starbucks goes to Rwanda

Last week, Rica Rwigamba attended a meeting with Starbucks (SBUX) CEO Howard Schultz at the U.S. embassy in Rwanda. Rica lives in Kigali, Rwanda's capital, where she is co-owner and director of New Dawn Associates, a "responsible tourism" and event management company. Rica is also a participant in the 2009 Fortune-U.S. State Department Global Women Leaders Mentoring Partnership, an extension of the Fortune Most Powerful Women Summit. Through this mentoring MORE
Jessica Shambora, Writer-Reporter - Jul 8, 2009 1:57 PM ET
Posted in: CEOs, FORTUNE MPWomen, FORTUNE-U.S. State Department Global Women Leaders Ment, Guest Post, Howard Schultz, Mentoring, Most Powerful Women, MPWomen Go Global, Postcards, Rwanda, Starbucks
Betting on Starbucks' lofty prices

My Fortune colleague Geoff Colvin writes in our March 2 issue that a few companies--DuPont (DD) and Colgate-Palmolive (CL) and McDonald's (MCD), to name three--are working overtime to preserve their brand equity in this downturn. Instead of discounting, they are, in some cases, actually raising prices.

Another company loathe to cut prices: Starbucks (SBUX). As I've noted on Postcards, CEO Howard Schultz told me last year that the smartest decision he MORE
Patricia Sellers - Mar 3, 2009 2:31 PM ET
Posted in: Bono, Brands, coffee, colgate-Palmolive, consumer goods, Costco, DuPont, Howard Schultz, Leadership by Geoff Colvin, management, McDonald's, Postcards, restaurants, retail, SBUX, Starbucks
Reinvent your firm, not your values

Reinvent!

Every manager is supposed be doing that these days. You know, there's a lot more risk in reinvention than just the uncertainty of your fancy new business model. In your rush to reinvent, you could well leave your core values behind.

I've been contemplating this lately for several reasons. For one, I'm sold on the wisdom of Jim Collins, the management guru who was part of a recent Fortune cover package MORE
Patricia Sellers - Feb 23, 2009 2:38 PM ET
Posted in: airlines, Brands, CEOs, consumer goods, eBay, Howard Schultz, IBM, Jim Collins, Leadership by Geoff Colvin, management, Meg Whitman, Postcards, Procter & Gamble, restaurants, retail, Roy Spence, Sam Walton, Silicon Valley, Southwest, Starbucks, technology, Wal-Mart
Taste-testing Starbucks instant

By Beth Kowitt

The company that brought premium java into the mainstream is now selling instant coffee. Is this the latest sign of the apocalypse?

At an event in New York today, Starbucks (SBUX) introduced the result of its biggest research investment to date: Starbucks Via Ready Brew, available in individual servings (a three-pack sells for $2.95; a 12-pack for $9.95).

Before you start accusing the iconic retailer of desperate measures, give Via MORE
Jessica Shambora, Writer-Reporter - Feb 17, 2009 6:09 PM ET
Posted in: Brands, CEOs, coffee, consumer goods, Howard Schultz, Postcards, restaurants, retail, SBUX, Starbucks

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