So, what’s up with Starbucks?
Sales are down, so they schedule a training day and whack the U.S. boss? I don’t get it.
Not that this “economy” stuff really keeps me up at night, but I would think that a $5 cup of joe could be at risk if household finances get snug… not sure that training all the servers and replacing the U.S. President (oops, my bad; she “resigned to spend more time with her family”) will change that.
Forced ranking, as a methodology for managing and improving performance, is neither good nor bad… it’s just another method.
Used as part of an integrated process, it can be very powerful. The problems we see with things like this are contextual; we hear about some successful company — GE, Yahoo, Sun, EDS come to mind — using this, and ask, “Can we do that here?”
The answer, of course, is “Yes, provided you bring the entire process that makes it work.” It’s not just a couple of chapters in an airport business book — it’s the whole enchilada.
To implement forced rankings without the process and structure to support it — management development, career pathing, internal coaching & mentoring, multiple opportunities for assignments — is truly a recipe for failure. (more…)
Had a previous client ask about negotiating with a potential high-level employee. Said it seemed like it was “just about the money,” and he was becoming disillusioned with this candidate because of that feeling.
Negotiations are just that — negotiations. They aren’t always a single exchange.
The same argument could be made about companies — if they won’t pay more, is it just about money, then?? Shouldn’t the company’s motivation be something greater than the short-term salary cost?
Most “Cost of Living Increases” are woefully mismanaged.
I get questions frequently on annual payroll increases. This year, 2008, the national average is hovering around 3.9%. You can see my article, same subject, for more detail.
A company, however, simply cannot continue to increase payroll in a vacuum.
All businesses can increase prices. And frankly, all businesses must do so on a regular basis. “Readily” and “successfully?” Depends on how they’ve been managed to that point.
Prices must rise, or companies go out of business. No organization can — successfully — continue to give pay raises each year, and absorb other inflationary costs, without raising prices, or finding a corresponding (or greater) reduction in operating costs.
So, Starbucks, the “evil empire,” is having a training day.
Actually, it’s more like a training half-day, but its the principle that’s so interesting.
Starbucks Coffee is shutting down all 7,100 (yes, that’s seven thousand) of its stores, keeping all 135,000 “baristas” on the clock, to do some necessary, in-house employee training.
I can’t begin to calculate the real costs; it must certainly approach or exceed $10,000,000. Easily.
And you’re agonizing over a few thousand dollars to provide some sorely-needed development to some key managers???
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