Kevin Johnson, Starbucks ceo, believes in bringing ideas to action in 100 days. This new way of working is designed to improve the customer experience and the day-to-day lives of partners working in Starbucks stores around the globe.
Kevin Johnson quietly strides out of his office on the eighth floor – alone, no entourage – and into a nearby elevator, where he pushes the button for the first floor.
There, the Starbucks chief executive officer rounds a corner and opens a massive, industrial metal door to enter the Tryer Center, the company’s secret sandbox for every flavor of innovation, from product to process to store design. Since it quietly opened in November, more than 130 projects have been developed and tested at Tryer Center and dozens have already made their way into stores.
Though he often visits several times a week, heads still turn as he wanders the bright, airy 20,000 square-foot space which, with its 3D printer, prototype sketches and neon signs, looks like a cross between a laboratory, a design firm and a dot-com startup. Starbucks partners wave and smile.
“Hi. What you got going on here?” he says, and then listens as they tell him about how they created a new pomegranate-flavored iced beverage or built a prototype for a one-cup coffee brewer or developed a new system for customers to pick up their mobile orders.
“Great!” Johnson says, smiling broadly before launching into a bevy of follow-up questions. Almost always, the last one is, “When can we try this in stores?”
Located on the ground floor of the company’s Seattle headquarters, Tryer has become a hub – a Tesla coil powering ideation and curiosity. Starbucks senior leaders, partners, and baristas can hack and hustle there in small, cross-functional teams, moving from words on Post-Its and sketches to real-life prototypes and action in record speed.
It’s not innovation for the sake of innovation, Johnson said. Rather, it’s obsessively focused on and in service of partners and customers – of making day-to-day life easier and better for partners and elevating every aspect of the customer experience.
“We are embracing new ideas and innovating in ways that are relevant to our customers, inspiring to our partners, and meaningful to our business,” he said.
The Tryer Center’s moveable, cardboard walls and working store components on wheels can all be arranged and rearranged in minutes. There’s even a working drive-through window. Precious little in the space is fixed, not the meeting spaces nor the thinking of the people in them. This is all very much by design.
“For me, the Tryer Center is sort of the physical manifestation of a new way of working at Starbucks,” said Johnson, 58, who took on the role of chief executive officer in 2017. “Scale and complexity can be the enemy of speed. We realized two years ago we had to change the way we work in order to be more agile.”
It goes without saying that any large, global company, such as Starbucks, with more than 30,000 stores worldwide and 330,000 partners serving 100 million customers a week, can find it difficult to be as nimble as a startup. Changes – whether in product, process or mindset – can take time to roll out. But, perhaps because of his more than 30 years as a leader in tech, an industry where even the briefest stagnancy can be akin to extinction, Johnson wears a different kind of watch. At Starbucks, he wants innovation to be measured not in years or months, but days. One hundred days, to be exact.
“We’ve gone from a long-cycle approach to innovation to one where we try to go from idea to action in 100 days, and we learn and adapt along the way,” Johnson said. “We’ve gone from large teams working in silos to smaller, cross-functional teams and from evaluating every idea as pass-fail to rapid iteration. We’re using data science and machine learning to inform process and product development. We’re listening to customers like never before, both quantitatively and qualitatively. We’re empowering partners, all partners, unlocking energy from them to help us carve the path forward for the company.”
As he said all this, Johnson gestured excitedly, barely taking a breath. He has hit a sweet spot in his tenure at the company – a spot where carrying the torch of an iconic coffee company successfully into the future has collided with his fast-twitch tech pedigree, analytical mind and team-centric leadership style.
“People have said, ‘How does a tech guy end up running a coffee company?’” Johnson said, chuckling. “But in the technology industry, if you fail to innovate or reinvent, you fall behind. I'm excited to leverage some of those learnings here, and to apply them to a company so grounded in the human experience and that touches so many lives on a weekly basis.”
Listening for great ideas
Levi Underwood, a lanky, blue-haired shift supervisor at a store in downtown Seattle, has made something of a name for himself in the realm of “con drinks.”
“Convention drinks,” he explained. “PAX, Sakura-Con, Emerald City Comic Con – every year it’s a tradition for the stores closest to those conventions to have secret comic-themed beverages. People come in every year just to try them.”
Underwood is one of a handful of baristas who now split their time between working in stores and working in the Tryer Center, innovating and helping make sure that what’s developed at Tryer will improve the experience not only for the customers, but also in the day-to-day lives of partners working in Starbucks around the globe. (Aptly, a “tryer” is the tool on a drum roaster used to collect a sample of coffee beans to track their roasting progress.)
“I came in and kind of just fell in love with it,” Underwood said. “This lab space is an opportunity for baristas to really give feedback on projects before they come down the line. We’re the experts at what we do, and here, our voices are heard. To be able to be seen and heard and have that feedback is crucial.”
Underwood said it’s thrilling to see things he helped test in the Tryer Center become reality. He helped ideate on the popular Nitro Cold Brew system, a project that resulted in a sleeker Nitro system design (nicknamed “Tapitha”) that can fit into all stores, even ones with limited space. He also helped test the Cloud Macchiato in the lab last year, “which is a huge thing now.”
Given the global distribution of the Starbucks workforce, it’s tough for partners in New York, Toronto or Shanghai to pop by the Tryer Center, so the company recently launched a digital hub for ideas as well. Springboard, an internal company website for “innovation crowdsourcing,” means partners all over the world can participate, whether by voting or commenting on existing projects or sharing their own ideas for the next great coffee creation or productivity hack.
Underwood, who is also studying online for a degree in communication through Arizona State University through the Starbucks College Achievement Plan, said it’s been surreal how many doors have opened to him.
“My favorite thing about being here is being a part of what’s next and seeing where Starbucks is wanting to go,” Underwood said.
Johnson said this is exactly as it should be and believes the company’s next big idea could come from anywhere.
“Truly. Anywhere and everywhere. We have to create an environment for people to be comfortable sharing,” Johnson said. “Great ideas come from our Starbucks partners, they come from our customers, they come from outside of Starbucks.”
Earlier this year, the company announced a partnership with Valor Equity Partners, an early investor in startups like Tesla, Uber and SpaceX. Starbucks made an investment of $100 million, the first-of-its kind for the company, and Valor will raise an additional $300 million from investors for the fund, which will focus on ideas and innovators in the retail, food and beverage spaces to help the company accelerate.
“We have to continually have our listening systems on,” Johnson said.
Fail soup and puzzle pieces
Natarajan “Venkat” Venkatakrishnan had an epic idea.
The vice president of equipment, packaging and processing, who now also oversees the Tryer Center, thought Starbucks should sell soup, which led to a project sprint.
“I pushed it a lot,” he said. “We tried a whole soup warming thing from the bottom up, similar to how we steam milk. We would warm it one cup at a time for customers. We even came up with a piece of equipment at Tryer and put it in a store to try it.”
He smiled and shook his head. “We didn’t sell much soup.” But that soup is the ethos of a changing Starbucks.
“It was fail soup,” he said. “Every company says fail fast, but how do you do that? That’s what we do here now. We have created a safe place to fail and for ideas to evolve and collide. Things like that give us the confidence that we can make any idea real and try it in stores.”
Partners continue to test and refine the Precision Milk Dispenser, which doles out exact measurements for milk based on type and drink size. It would also reduce the need for partners to lug heavy plastic jugs around as well as the amount of plastic used. The average store uses about 35 1-gallon jugs of milk a day.
Kathie Pease, a senior manager at Tryer Center leading the “dairy sprint,” said the idea for putting milk dispensers in stores has been floating around for several years. As a partner of 21 years, she said she’s never seen the company bring ideas to life so quickly.
“It feels a little bit like I have a new job,” said Pease, who has worked in various research and development roles at the company for years. “In the past, it’s been all or nothing versus an iterative mentality. It feels like there is a shift to this spirit of growth and innovation – an empowerment to think differently, and to actually show versus talk about things.”
At Cold Pop, a neon-infused, Instagram-worthy beverage stand inside Tryer Center, partners have already tasted (and voted on) dozens of new beverage inventions. Open three days a week, Cold Pop serves about 200 drinks a day to partners from the company’s Starbucks Support Center who pay $5 a beverage in exchange for potentially tasting the future. (The money benefits the Cup Fund for partners who are in financial need.)
Starbucks chief operating officer Roz Brewer likes to say that beverage innovation is the company’s most important focus. Luigi Bonini is the guy who probably hears those words the loudest.
Bonini’s team of food and beverage scientists are responsible for a long line of breakout favorites, including the Cloud Macchiato, Sous Vide Egg Bites, Mango Dragonfruit Refreshers, the Chestnut Praline Latte, Bistro Boxes and 2017’s legendary Unicorn Frappuccino, the most viral drink in company history.
The senior vice president of innovation and product development came to Starbucks in 2011. He said he’s worked for a handful of well-known brands, but never in his life did people react the way they did when they found out he leads a team of food and beverage scientists at Starbucks.
“People would introduce me at dinners or parties and say, ‘You know the Unicorn Frappuccino? His team invented that,’” Bonini said. “Then everyone will immediately tell me what they love, what they miss and what they were disappointed about. Everybody has a Starbucks story. It’s a deeply experiential brand.”
His team has always been non-linear and scrappy. One beverage scientist even invented a popular Starbucks Reserve drink after experimenting with aging coffee in whiskey barrels at home in his garage. Now, the Tryer Center will more often than not be the first stop for many of his team’s inventions.
“Everybody on our team gets up every morning thinking about how to be a part of people’s lifestyles and how to stay relevant. This is the spirit of innovation we’re wanting to pull through company-wide,” Bonini said. “Innovation is rooted in the company’s history and culture. Before, innovation took the form of a lot of discussion and meetings. Now, we can just go build things and let people try them and capture insights in real time.”
Innovation at Tryer isn’t just about the next big thing that you can see and taste. Sometimes it’s also about how things happening quietly behind the scenes can have a big impact. Johnson has made it clear that he wants partners across the company to take a hard look at how to improve efficiencies and ways of working.
At the Tryer Center and beyond, across all parts of the company, partners are dissecting all kinds of processes in an effort to make work less complex for store partners, from how Starbucks thaws food in stores, to how partners count inventory and forecast labor, to how the company gets new hires ready for their first morning of work. To the legion of process nerds at Starbucks, these projects are every bit as exhilarating as working on The Next Big Beverage.
Jessica Gabry is a program manager leading the effort to improve the company’s onboarding process for new partners. She recently worked on a team of human resources, facilities, recruitment, identity management, technology experts and recent hires to reinvent “Day One Readiness” for new non-retail partners. This means a new partner’s laptop, email, phone and other technology are ready and waiting for them when they arrive to work on the first morning. Future projects will look at streamlining the onboarding process for retail partners as well, she said.
At Tryer, “you have people from all over the business on this neutral playing field, this place to engage and be present in the moment and not feel like what you’re working on is mundane or day-to-day,” Gabry said. “The blank innovation space and ambient noise of creativity and innovation around you give you a connectedness to the larger brand – the knowledge that it’s not just your project, you can see the piece you are of the puzzle.”
The Tryer Center is just the most visible manifestation of the changes afoot at Starbucks, Johnson said. Velocity and innovation are making their way to all corners of the company, and he hopes partners and customers can feel it.
“Unless or until the ideas we’re working on make it into our stores, they won’t have an impact. So, what I aspire to see is more ideas coming into our stores faster. And that we learn and adapt, and we are constantly making things better and constantly listening to our customers and partners. And that through all of that we become a better company, and that by becoming a better company we set the foundation for the next 50 years at Starbucks.”
Johnson’s commitment to making innovation something the company lives and breathes is one of the reasons he hired Danny Brooks, the company’s vice president of innovation culture and methodologies.
“They asked me to join the company after four interviews,” said Brooks, who came to Starbucks two years ago. “I asked for 11 more interviews, including one with Kevin. In each interview, I asked, ‘Are you sure you want me at Starbucks? I ask questions. I raise red flags. I’m kind of a provocateur.’”
Today, Brooks thinks of himself as one of the company’s chief disruptors. His office, with its walls covered floor-to-ceiling in Post-It notes and stacks of thick reports, looks a bit like the command center in every police detective movie and television show ever. That is, until you actually read the Post-It notes.
“We must tailor how we connect with customers to meet their diverse needs” reads one.
“Partners are faced with challenges within the four walls of their store” reads another. And, as if to answer that one: “Happy partners are key to a successful business.”
In the broadest sense, Brooks actually is a bit of a detective. He and his team are deep in the work of the company’s “brand promise.” Brooks and his team have conducted hundreds of interviews with partners and customers, both in Seattle and the field, trying to answer big questions about how people perceive Starbucks, and how that perception matches up (or in some cases doesn’t) with what the company believes about itself.
“It’s nothing less than codifying our founder’s intuition,” Brooks said. Starbucks founder “Howard [Schultz] carried the brand inside him. We are in the process of systematizing that intuition, which is extraordinary.”
Jon Francis, the company’s senior vice president of enterprise analytics, data science, research data and analytics, put it this way: “Howard had really good intuition. The rest of us are not Howard. Our intuition is billions of data points.”
Starbucks is relying on data and analytics like never before in an effort to enhance every possible aspect of the customer and partner experience, whether it’s making the Starbucks mobile app more intuitive or making sure partners have the tools they need to be successful, Francis said.
With teams at the company moving faster, everyone needs data to help inform decision making, Francis said. He and his team have worked to make information more democratized and self-serve, which in turn can provide valuable insights.
“It does feel like we’re at an inflection point in terms of driving innovation at scale, but in a Starbucks way,” Francis said. “This isn’t Amazon. There’s tons of innovation happening there every day, too, but it won’t have the same look and feel. Our innovation is grounded in our DNA. It feels like everything new we’re trying to do right now still goes back to our core.”
On his way out of the Tryer Center, Johnson paused by the board detailing all the ongoing projects at the Tryer Center and smiled before walking through a secure door – Tryer Lab is strictly partners only – and back to the elevators. On this day, he won’t pause at the basketball backboard mounted on the wall in the back of the space to shoot hoops like he often does.
When Johnson became ceo in April 2017 with the departure of founder Schultz, he knew that for all their differences in background and style, the two share an abiding belief that the company is grounded in human experience and that Starbucks has a purpose well beyond the pursuit of profit – the pursuit of doing good.
“I think one of the most important things, thinking about a transition from a founder-led to a founder-inspired company, is that I don't believe this is a transition from Howard to me. It's from Howard to the team. We all play a role,” Johnson said. “As part of that, we have a responsibility to have the wisdom to know what to honor from the past, but more importantly, the courage to boldly reinvent everything else.”