On this day in 1971, Starbucks began—Here’s how its HR strategy fueled its growth

Today marks the anniversary of Starbucks' founding, a journey that began in 1971 as a single coffee shop in Seattle’s Pike Place Market and has since grown into a global powerhouse with over 35,000 locations worldwide. While Starbucks is often recognised for its coffee culture, a key pillar of its success has been its people-first approach to business.

From the early days to its present status as one of the world’s most influential coffee chains, Starbucks’ human resources (HR) strategies have evolved significantly. Let’s explore the company’s approach to managing employees, its HR leadership through the years, and the key takeaways from its talent management philosophy.

Starbucks’ HR: through the years

HR leadership at Starbucks has played a pivotal role in shaping its workplace culture. Here are some of the key HR leaders who contributed to Starbucks' evolution:

Howard Behar (1989-2003)

Howard Behar served as the President of Starbucks North America and later as the President of Starbucks International. His tenure was marked by a profound emphasis on creating a people-centric culture. Behar believed that the company's success hinged on treating employees with respect and dignity.

He was instrumental in fostering an environment where open communication and personal growth were encouraged. His philosophy that Starbucks was in the "people business serving coffee" rather than the "coffee business serving people" became a foundational principle, influencing policies that prioritised employee well-being and engagement.

Dave Pace (2001-2009)

As the Executive Vice President of Partner Resources, Dave Pace focused on strengthening Starbucks' training and development programmes. Recognising the importance of well-trained staff in delivering exceptional customer service, he expanded learning opportunities for partners at all levels. Pace's initiatives included leadership development programmes aimed at preparing employees for managerial roles, thereby promoting internal career progression. His efforts contributed to building a knowledgeable and motivated workforce aligned with Starbucks' mission and values.

Kris Engskov (2010-2015)

During his tenure, Kris Engskov held various executive roles, including President of Starbucks Europe, Middle East, and Africa. He prioritised leadership development, implementing programmes designed to identify and nurture talent within the organisation. Engskov's approach ensured that as Starbucks expanded globally, it maintained a consistent culture and high standards of service by investing in the growth and capabilities of its leaders.

Lucy Helm (2017-2020)

As Chief Partner Officer, Lucy Helm played a crucial role in advancing Starbucks' diversity and inclusion efforts. She led initiatives aimed at creating a more inclusive workplace, such as implementing training programmes to address unconscious bias and promoting policies that supported equity across the organisation. Under her leadership, Starbucks strengthened its commitment to building a diverse workforce reflective of its global customer base, enhancing the company's reputation as an inclusive employer.

Sara Kelly (2020-present)

Sara Kelly, serving as the Executive Vice President of Partner Resources, has been instrumental in guiding Starbucks through recent workforce challenges. Her leadership has encompassed addressing labour relations, including navigating unionisation efforts and responding to employee concerns about wages and working conditions.

Kelly has overseen initiatives to improve partner benefits, such as increasing paid parental leave, and has focused on enhancing communication between leadership and partners to foster a more collaborative work environment. Her efforts reflect a commitment to adapting Starbucks' people strategies to meet evolving needs while maintaining the company's core values.

Jez Langhorn (2023-present) – strengthening HR operations

In September 2023, Jez Langhorn joined Starbucks as the Senior Vice President of Partner Resources for North America. With a background that includes over two decades at McDonald's in various HR leadership roles, Langhorn brings extensive experience in building high-performing teams across large-scale operations.

At Starbucks, he is responsible for leading HR functions that support UK company-owned stores, licensed stores, and global operations. Langhorn's focus includes enhancing talent acquisition, development, and retention strategies, as well as fostering an inclusive and supportive work environment that aligns with Starbucks' mission to inspire and nurture the human spirit.

How Starbucks managed its workforce over the years

Early days: The foundation of a people-first culture

In its early years, Starbucks focused on creating a strong company culture, treating employees (referred to as “partners”) as valued contributors rather than just workers. Starbucks co-founder Howard Schultz played a critical role in instilling a sense of purpose among employees, ensuring that even part-time workers received healthcare benefits—a pioneering move in the food and beverage industry at the time.

As Starbucks expanded throughout the 1990s and early 2000s, the company developed structured training programmes, leadership pathways, and benefits designed to retain top talent. Starbucks introduced:

• Comprehensive training programmes for baristas and store managers.
• The Bean Stock programme (1991), which allowed employees to own company shares.
• Full healthcare benefits for eligible part-time and full-time employees.

Scaling Starbucks: HR strategies for global growth

• As Starbucks rapidly scaled into a global brand, its workforce expanded from thousands to over 400,000 employees worldwide. HR had to adapt strategies for workforce engagement, talent acquisition, and leadership development.
• In 2008, Starbucks faced financial struggles, leading to store closures and workforce reductions. However, the company focused on upskilling and reskilling employees, ensuring that career growth remained a priority.
• By 2015, Starbucks launched its College Achievement Plan, offering US employees tuition coverage for Arizona State University’s online degree programmes.
• Inclusion and diversity initiatives became a focal point, with Starbucks making a commitment to hire 10,000 refugees worldwide by 2022.

HR lessons to take from Starbucks’ talent strategy

Starbucks' HR practices offer several takeaways for companies looking to build a strong, engaged workforce:

• Employee benefits matter: Offering healthcare and stock options to even part-time workers helps build loyalty and reduces turnover.
• Invest in learning & development: Starbucks ensures that its baristas and managers receive leadership training, which fosters career growth.
• Diversity & inclusion is non-negotiable: Starbucks has prioritised hiring diverse talent and ensuring an inclusive workplace culture.
• Flexibility & adaptability: The company has adjusted HR policies in response to economic shifts, unionisation efforts, and changing workforce expectations.

Recent HR developments at Starbucks

Starbucks continues to evolve its HR practices to meet the demands of a changing workforce. Recent initiatives include:

• Addressing unionisation efforts (2021-present): Starbucks has faced growing unionisation efforts among employees, prompting leadership to review worker conditions and engagement strategies.
• Enhanced parental benefits: Starbucks has expanded parental leave and mental health resources.
• Increased wage adjustments: In response to economic pressures and labour movements, Starbucks has raised wages and benefits for its employees.
• AI & tech in HR: Starbucks has integrated AI-driven scheduling and training tools to enhance efficiency.

Starbucks’ journey from a single store in Seattle to a global giant is a testament to the power of effective HR and people management. By prioritising employee well-being, investing in leadership development, and embracing workplace innovation, Starbucks has set an industry benchmark that companies worldwide can learn from.