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How tech-savvy Kevin Johnson is creating 'the next generation' of Starbucks

Starbucks (SBUX) CEO Kevin Johnson is jumpstarting the pace of innovation at the coffee giant, thanks to his deep technology background.

Johnson, who took over the top spot in April 2017, was previously the CEO of Juniper Networks (JNPR) and a top executive at Microsoft (MSFT). Since he took over in April 2017, shares of Starbucks have gained nearly 64%, and are up more than 50% since the beginning of this year.

Once Johnson took the helm, one of his observations was that the velocity of innovation was slowing down at Starbucks. With 31,000 stores, "scale and complexity can be the enemy of speed," he told Yahoo Finance this week.

Under Johnson’s watch, Starbucks has now taken its long innovation cycle to one where the company goes from idea to action in 100 days.

"I tried to take all that I learned in 32 years in the tech industry about how you innovate in technology, and we started to apply that here at Starbucks," Johnson said in an exclusive interview this week from Starbucks’ Leadership Experience in Chicago.

One of the approaches Johnson has taken at Starbucks is embracing human-centered design. It’s a problem-solving method that puts the customer and employee experience and interaction — including the physical and digital environment — at every step of the process.

"There's a methodology you go about where with quantitative and qualitative research to identify for customers and our partners what are the things we need to design to make their experience better?" Johnson stated.

"We then embrace the mantra of going from idea to action in 100 days, and then learn and adapt,” he added.

Johnson also deployed smaller, cross-functional, agile teams of 15 or fewer from different areas of the company to come up with better solutions.

‘Create the next generation of Starbucks’

"They move faster, the solutions are more relevant to our customers, they're more inspiring to our partners, and it is transforming the way we work at Starbucks," he said.

Johnson also believes in empowering employees at all levels to tackle some of the problems. The company posts the projects on its internal website called Springboard to gather feedback.

A subset of those projects on Springboard enter the Tryer Center, an innovation lab where employees can test and try beverages, prototype and build new equipment, and create processes that make the in-store experience more efficient for customers and partners.

Mark your calendar.

The center opened at the Seattle headquarters in November 2018. To date, more than 130 projects tested, and dozens are already in stores.

"Once they're in the Tryer Center, we have a team of partners, often in the field, and they're helping us design and create the next generation of Starbucks."


Julia La Roche is a finance reporter at Yahoo
Finance. Follow her on Twitter.