Howard Schultz of Starbucks
"Schultz tends to see his company’s recent tribulations as a case study in what can happen to a business that uses growth as a strategy rather than a tactic. For the better part of 15 years, he explains, from 1992 through 2006, "practically everything the company did produced a level of success and adulation." Yet Starbucks’s consistent successes distorted its managers’ view of their own creativity. As he puts it: "If Frappuccino is a hot category and you introduce a new flavor, and it moves the needle a lot, the organization comes to believe, 'That was a great thing we did.' And it imprints a feeling of, 'That was innovation.' But that’s not innovation. In fact, it’s laziness." The line extension of a product, by Schultz’s criteria, involves little in the way of risk taking or long-range vision. And that was the problem with the old Starbucks."
