Coffee & Khakis – The Strategy-into-Action Readiness Scorecard
Over the last few weeks there have been a few major shake ups across the corporate landscape that involve shifting priorities, opportunities and – not surprisingly – strategies. While every situation is different, it does give us a chance to compare different approaches, introduce you to a tool we use to gauge strategic fitness, and let me ramble about two things that are near and dear to my heart: coffee and khakis.
In August, Starbucks announced that it was bringing in former Chipotle CEO to run the house that Howard built. In his first week on the job, new CEO Brian Niccol (ex-Chipotle, ex-Taco Bell) sent out a letter addressed to three groups: partners, customers and stakeholders. In it, Niccol described the challenges the coffee chain faced as it drifted away from the core. The brand was strong and mattered to people who worked there, who shopped there and who invested in it. The customer experience, however, failed to live up to its promise. Rather than a place to drop in, linger and recharge, the relationship between Starbucks and customers was increasingly transactional. For employees – especially the frontline, “green aprons” – the expansion of the menu was a nightmare. (When I last checked, there were 155 different drinks available at my local Starbucks, and that’s not counting customizations.) So, we have promise-to-experience dissonance, unhappy and unsupported staff, and unchecked complexity.
So what is Brian’s plan? On the surface, it’s quite simple. First, they’ll start with the baristas in the green aprons who deliver Starbucks to each and every customer. In addition to promising to make Starbucks a great place to work and providing better benefits and opportunities, Niccol’s writes, “We’ll make sure our baristas have the tools and time to craft great drinks every time, delivered personally to each customer.” Second, Starbucks will have a focus on quality to “Get the morning right, every morning.” Third, Starbucks – the brand that was once famous for its role as “the third place” – will reestablish itself as “the community coffeehouse”. And fourth and finally, Starbucks is going to start telling its story, which to me means moving away from the CPG-like focus on new product launches, back to giving people a reason to choose Starbucks, not just the Limited Time Iced Rainbow Sprinkle Whip White Mocha Banana Latte. Whether you agree with the plan or not, those are four clear things that the CEO is asking the organization to do. And while the objectives feel familiar – fundamentally it’s a “let’s get back to basics” approach – the required steps and changes are significant.
Next door, we can take our coffees into The Gap and see what’s afoot. CEO Richard Dickson joined Gap, Inc in the summer of 2023, fresh on the heels of his success rebooting Barbie as Mattel’s President and COO. The culmination of his multi-year journey with Barbie was the eponymous blockbuster movie, which seemed to cement the brand’s shift from relic of the past to reflection of the moment. At the Gap, Dickson has laid out a few strategic moves that he believes will take the brand from decline back to growth. What are they? Well, first up, there’s a freshening of how the brand shows up. In the last few years, Gap.com highlighted sales discounts more than it highlighted new products. At times visitors even faced competing offers (50% vs 40%?) side by side. Dickson pushed to have the website lead with product, clean up the interface, and make things easier for consumers to use. Second is a desire to make Gap a pop culture brand again. Tapping into the brand’s origins in San Francisco where it sold blue jeans, records and cassette tapes (#bringbackthemixtape), Dickson has expressed a desire to make The Gap culturally relevant again. And, finally, Dickson argues that The Gap should reach for its historic purpose of closing the “generational gap” and work to close the cultural chasm that we see in society today. So, he is challenging his team to stop relying on discounts, aim to be culturally relevant, and pursue a stronger purpose and mission in the world.
The Strategy-into-Action Readiness Scorecard has five criteria that each capture a different part of how strategies are (or aren’t) set up to drive action.
Now, let’s turn to our Strategy-into-Action Readiness Scorecard. The scorecard has five criteria that each capture a different part of how strategies are (or aren’t) set up to drive action.
Criteria 1: Clarity of Strategic Objective or Destination – Is it clearly evident where the business is trying to head?
Criteria 2: Actionability of the Strategy – Is the strategy articulated in a way that lends itself to a set of actionable steps?
Criteria 3: Urgency and Importance – Is there a sense of urgency to make a change? Is there agreement to make this the most important focus right now?
Criteria 4: Buyability of the Strategy – Is the strategy one that the team(s) across the organization can buy into? Can they/will they be willing to get aligned and execute?
Criteria 5: Capability to Execute the Strategy – Is the organization – and the individuals within it – ready to execute? Do they have all the capabilities in place to be successful, do they need to learn new skills, or do they need time to practice?
This scorecard recognizes that while every situation and its accompanying strategy is unique, the ingredients for successfully deploying strategy get held to the same standards. A look at how a brand, business, product or customer strategy stacks up against these criterias can help us figure out where we need to spend some time getting things right before we get going. Okay, now back to coffee and khakis.
The Strategy-into-Action Readiness Scorecard looks at five characteristics that can make or break a strategic initiative
Clarity of Strategic Objective or Destination
In the case of Starbucks, making the brand a place that people want to spend time in, and where consumers can get the products and experience they expect without breaking employees is a strong ambition, and one grounded in specificity. We’d argue that The Gap describes its destination in fuzzier terms, something along the lines of “be culturally relevant”. There’s nothing inherently wrong with how The Gap describes its destination, it just isn’t as clear in defining how they’ll get there.
STA Readiness Score: Starbucks: 5 | Gap: 3
Actionability of the Strategy
Strategy isn’t just about deciding on a destination. It’s also about picking out the path from where we are today to where we want to be tomorrow. A strategy that points to a set of understandable steps and actions is better than one that simply states a goal. Here, Starbucks has a decided edge, with Niccol’s plan built upon four key steps that the company must focus on. The Gap, according to Dickson, has two key steps: first refresh brand expression; second make the brand culturally relevant again. While the refresh can be seen as a tangible, actionable step, making a brand culturally relevant begs another question: how? It’s in the how, in the action steps, that strategy goes from being aspirational to actionable.
STA Readiness Score: Starbucks: 5 | Gap: 2
Urgency and Importance
Here, perhaps the two brands – and their two leaders – are closer to one another. The Gap clearly needs to change, and it appears that those at the company agree, from the executives at the top to the hard-working retail shop employees. Starbucks, similarly, must change if it is to survive. The difference is in how crucial that change is to the future of the business. While Dickson leans into The Gap’s history as a way to justify its place in culture, Niccol’s places things in more of a burning platform style moment. Both acknowledge the base upon which the brands rest. But it is Niccols who leans into what’s at risk.
STA Readiness Score: Starbucks: 5 | Gap: 3
Buyability of the Strategy
Is the strategy one that teams and individuals in all parts of the organization can rally around and buy into? Here the two leaders’ different approaches show how there can be multiple paths to the same destination. Niccol and his four-part strategy makes it crystal clear what teams need to agree to and what they are expected to deliver. If you don’t agree, well, that’s not the plan. Dickson leaves more room for flexibility and individual interpretation. Given that the strategy itself has less precision to it, that’s not a weakness, but a feature. In a creative organization – like a fashion brand – allowing for interpretation, experimentation and creativity is one way to find the things that work. And it helps teams quickly develop a sense of ownership and purpose.
STA Readiness Score: Starbucks: 4 | Gap: 4
Capability to Execute
Can the organization pull it off? This is a question of culture and attitude, as well as tools and resources. Are teams and individuals willing to make the changes and execute the plan? Or are they more likely to try to wait it out, expecting another shift in strategy to be around the corner? Looking in from the outside, it’s hard to tell. Starbucks will have to undo a lot of designed-in ways of working, ask people to give up their prized achievements and do some really hard process reengineering. Basically, whether in the stores or in the corporate HQ offices, people’s jobs are changing, which is a big pill to swallow. For the Gap, the required shifts are less clear. Because of this, perhaps it's something that will take less selling, less convincing? And perhaps by being open to interpretation, it allows individuals and teams to figure out for themselves how to deliver.
STA Readiness Score: Starbucks: 3 | Gap: 4
Which leaves us with this:
Different companies, different needs, different strategies
Based on our Strategy-into-Action Readiness scorecard, the advantage is with Starbucks. While there are questions around the ability of the organization to tackle and stick with the changes it needs to make, there are few questions around where the company must head, how it must get there, and why it has to act now. The job to be done is to make sure that teams have the breathing room to start making the needed changes, to practice them, and to scale.
The Gap, on the other hand, has an advantage in how it is creating space for interpretation of the strategy, potentially allowing teams to find novel solutions to old problems. It’s in the early parts of the scorecard that the Gap suffers the most. Without clarity of destination, clear steps to get there and a sense that there are no other options, there is a real risk that strategy becomes optional. When that happens, leadership – rather than continuing to explore and drive the strategy – can quickly find themselves needing to chase people down, put out fires and be in the weeds of the business.
Time will tell which – if either – of these moments will become positive inflection points for Starbucks and the Gap. But, the scorecard helps to highlight where each organization – its leaders and its teams – ought to focus going forward.
Drop us a line at Hello@MixtapePartners.com and let us know what you think of our scorecard, our assessment of these two brands, and how you like to test the readiness of your strategies.