This is the core issue I want to discuss today. 1987, Starbucks had only 1 1 stores and 100 employees. Our dream is to set up a different company. This company should not only build a national brand, but also show unprecedented characteristics. Leaders can walk with employees and enjoy success together.
As your dean said, we are the first company in the United States to provide employees with comprehensive medical insurance and equity in the form of options. That was before we went public. At that time, many people thought that these benefits reduced shareholders' rights and interests and would not last long. What we thought at that time and what we think now is that only the success that can be shared is the best success.
Today, you have to do business in a very different way, which is very different from the past. 1987, we only had 100 employees,1/store, and wanted to establish a unique company. Today, as the dean said, we have more than 25,000 stores in 75 countries, and we have 330,000 employees. Last week, 9,654,380,000 customers visited us.
Then the question is, a company that sells coffee and paper cups, large and small cups are still Italian that most people can't pronounce well (laughs), and each cup of coffee is only 3 or 4 dollars. How can it give benefits that no one has given before? At 1987, there are only 1 1 stores. Today, there are 26,000 stores with a market value of nearly $90 billion. How did this happen?
The same problem is that a company that opened only 1 stores in China in 1999 now has 2,637 stores, serving 5 million customers and employing 40,000 people every week. Today, it also announced a plan, which can be said to embody Starbucks' iconic values, culture and norms.
This plan embodies our true colors. All businesses, no matter what products, services, industries and countries, should be clear about their core purpose and reasons for existence. Today, we announced in Beijing that medical insurance for employees' parents will be launched from June 1, in order to clarify our core purpose and reason for existence.
Why are we doing this?
Why does a company spend millions on insurance for employees' parents? The answer to this question can be traced back to 1987, that is, not all business decisions should consider whether it is cost-effective. In fact, I want to say that many decisions made by Starbucks have nothing to do with cost performance, and some even do the opposite. In this way, we cut corners more than once, which is also the main reason why Starbucks can maintain its financial success.
The reason is that if you want to build a long-term enterprise in today's environment, the basic principle of success is trust. As managers and leaders, our responsibility is to do better than employees' expectations and build trust with them so that they can do better than customers' expectations.
Where does this philosophy, values, culture and norms come from? First of all, I want to say that we are definitely the best coffee machine in the world. Our real estate portfolio is probably the best among retail enterprises in the world, and our interior decoration is second to none. Coffee quality, real estate portfolio, interior decoration and operation level are all excellent, but these are secondary to the company's fundamentals. The root of an enterprise lies in culture, in behavior and in the way we behave. Believe it or not, this cultural value actually started when I was a child.
I grew up in Brooklyn, new york, and lived in a government building. You may have all heard of the American dream, the promise of the United States-in the United States, people's social status is not static. Well, when I was 7 years old, I came home from school one day and my father's work was terrible. In my opinion, seven years old is probably the worst. He opened diapers, and there were no Pampers diapers at that time. One day in March, 1960, it was still winter and it was very cold. He slipped on the ice and broke his femur and pelvis. In 1960 America, if you are just a worker, you will be fired if you are injured at work. My family has no income and no insurance. At the age of seven, I witnessed the disillusionment of the American dream. I watched my parents get discouraged and the whole family collapsed. The trauma I suffered when I was 7 years old continues to this day. Despite these successes, childhood fears of failure, insecurity and fragility still exist today.
Compassion, sensitivity, respect and dignity are the nature of all people. If we want to build a young enterprise, we must do business in different ways. The relationship between people is caused by values, this emphasis on people's values. In fact, we did the whole thing in reverse. The most important thing is no longer shareholders, but our employees, followed by customers and then shareholders. 1June, 1992, Starbucks went public, with 125 stores, with a quarter profit. The market value at that time was $250 million. I feel like I won the lottery. I called my mother and said, "Mom, we made it. Our American dream has come true, $250 million! "
Twenty-five years later, the market value of Starbucks rose from 250 million dollars to nearly 90 billion dollars. If you see our success and ask how we succeeded, I can tell you personally, not because I have an MBA, but because I didn't go to an MBA (laughs); It's not because I have a business degree, and neither do I. I may not graduate if I want to go to business (laughs). I have rich life experience.
No matter where I go and what I do, I try to be curious. What I want to say to you is that you must keep a strong thirst for knowledge. Curious about the world, curious about the surroundings, curiosity can make you learn all kinds of people and experiences, and the effect will surprise you.
"I have you, I have me."
For example, six months ago, Starbucks opened its first store in South Africa. I have never been to South Africa, and I really want to go. We went there to open two stores. After opening, there is a long queue in front of the store, and people will queue up for two hours to drink coffee at the door. I have been to the opening ceremony of Starbucks many times, but I have never seen anything like it in my life. There is no advertisement, no promotion, only one message: Starbucks is open.
Two days before the official opening, I did what I always do, sat down and chatted with the young people who were about to put on Starbucks apron. Many people think that what Starbucks does best is marketing. We are not a marketing company. Our marketing sucks (laughs). I say this-I know some people don't want to say it (laughs)-because we build our brand by in-store experience, and this experience lies in the emotional connection between people, that is, the feelings between our employees and customers. The essence of Starbucks brand lies in those employees who wear green aprons. So I'm going to sit down and talk to people who wear green aprons and our brand in Johannesburg, South Africa.
I sat with 15 young people and asked them to tell me a story one by one. The first thing they talked about was the living conditions in the town. How many people here have been to South Africa, please raise your hand? Not too much. How many people have seen what this town is like?
As I said just now, when I was a child, my family was poor and I lived in a public house. When I went to see these towns, it was really hard. The level of poverty and living conditions are worrying. However, those young people are in a good mood, happy and grateful because of their families. When they tell me their stories one by one, I always hear them say an African dialect that I have never heard before, and many of them are saying it. Finally, I got up the courage to ask them, "Which word are you talking about?"
“Ubuntu”.
This is what they have been saying. I asked them what the word meant, and they rushed to tell me that "Ubuntu" was a word that Mandela used many times, meaning "I am because of you".
If there is anything worth remembering in my speech tonight, I hope everyone here will remember the words, "Ubuntu" and "I have you".
Selflessness, sharing, being responsible for others, realizing that you are the same as the people around you, realizing the significance of the team, and truly understanding that only the success that can be shared can drive all employees forward.
Before listening to them, I didn't know the meaning of Ubuntu, but I didn't know how important the word was to them and how to use it in Starbucks.
This morning, we sat with a group of Starbucks partners-we call employees partners because all employees are bosses-and many of them brought their parents. We will do this because we have met our partner's parents in China every year for the past five years. Regardless of sales volume, income, profit and stock price, consider it a family holiday to show our gratitude and respect and let parents see that we realize that we have the responsibility to take care of their children.
At this morning's meeting, what we want to know is what will happen if our partner's parents get sick or die. A few months ago, we made a survey and found that what Starbucks Chinese partners want to do most is to take care of their elderly parents.
We all shed tears this morning, because we heard such a true, fragile and brave story, and they were worried that their parents could not take care of themselves after they were old and sick. In China, you have experienced many things that we can't experience in the United States. It is your responsibility to honor your parents and grandparents. It's not that America has no filial piety, but that you have to bear this responsibility all your life.
As a company, how can you stand by? How can we be a bystander when we hear these stories and demands? We have to do something. So we announced this plan today. Like everything Starbucks has done in the past 47 years, this is also a milestone event. We did this because we are not an American company operating in the China market, but a China company, so we have housing allowance, we have employee stock ownership, and we have cooperated with Soong Ching Ling Foundation for 10 years. These things are not marketing or media public relations, but the essence of a company's culture and values.
As I said before, not all business decisions depend on whether the planning is cost-effective. After you graduate from school and start your own business, it may become a kind of pressure, the pressure to make money, and the pressure for listed companies to publish quarterly reports. The hardest thing to build an evergreen enterprise is to take a long-term view.
Many, many decisions you have to make may involve things in five years, 10 years, 15 years. Make seemingly unconventional and unorthodox decisions according to the core purpose and reason of existence. How many of you have read what we have done to fight racism in America? How many people have seen it? Is that all? All right. Few of you read in the newspaper that we will employ 1000 refugees all over the world? Why do we do these things? How many of you know that we provide free four-year college education for Starbucks employees in the United States through Arizona State University? How many of you know?
This goes back to the core question: what kind of responsibilities should the profitable listed companies bear today?
Pursuing performance through human nature
I firmly believe that our core responsibility is not just to make money. In fact, I would say that we are a company that pursues performance through human nature. When I sit in the boardroom and give a meeting to the top management once a week, I always feel that there are two empty chairs in the boardroom. I always thought so. One chair is a customer, and the other chair is a Starbucks partner. I keep asking myself, what are we arguing about, what decisions we make, what strategies we adopt, and whether a certain decision can make our customers and partners proud. If we are on the wrong side of the argument, they won't be proud of it. If they decide to make more money in the short term, they will be even less proud. In that case, there is no doubt that we did something wrong.
I can assure you that there are no words such as "love", "humanity" and "compassion" in your textbook, and I dare say that many business school books do not have these words. What I advocate is that if you want to build an excellent and long-term enterprise, its root lies in empathy, compassion, humanity and love. It must be said that in most cases, if the culture and values of an enterprise cannot be unified to these qualities, it will be difficult to attract and maintain customers.
You have a good strategy, you have a corporate culture, and you have clear values and norms, which can bring great trust. Employees believe in mission, and managers and leaders can show real service-oriented leadership every day. Then nothing can stop you.
From Starbucks in 1987 to Starbucks now, how did we grow up from that time to today? How can we make China people who have never touched coffee drink coffee before? Of course, we have excellent coffee and excellent shops, but what is really important is that our relationship with customers is based on culture.
As for today's business environment, I have to say that on the one hand, it may be easier to obtain capital than ever before, but on the other hand, the competition is too fierce and there are too many interferences, so it is very, very difficult to succeed. What determines the success or failure of an excellent strategy and an evergreen enterprise? I dare say that I am by no means the smartest person in this hall. The main reason for Starbucks' success in the world is that the culture and values we created are universal. We have stores in China, Japan, the United States, Europe and Mexico.
We cooperate with companies that we trust and respect, and we will work wholeheartedly. That's because of Ubuntu and you.
Service leadership
I am thinking about the challenges faced by enterprises. What can we really share? What obstacles do we need to overcome to succeed? People have said many times that Starbucks can't do it. China is an example. We 1999 opened a store and suffered losses for many years. Many people in the United States say that Starbucks China should close down. Our success in various places is not achieved overnight, but we insist on believing in our core purpose, keep our promises and do everything possible to put our employees first. We realize that if we can't do what employees expect, we can't do what customers expect. We understand that in many cases, culture, values and norms are as important as or even more important than strategy.
In other words, if the culture itself is weak, confidence is broken, and employees don't believe in the mission, goals and leaders of the enterprise, then the greatest strategy in the world can't last.
Starting a company, especially at the beginning, is like raising a child. At that time, you will be in the stage of learning and memory, and every company has its own memory. There will be early behavior, set a good direction and show the true meaning of service-oriented leadership.
How many people have heard of service-oriented leadership? I want to hear it out loud. What is service-oriented leadership?
"serve others", anything else? You are all the cleverest children in this country. Help others succeed.
How many people are willing to work for service-oriented leaders? Raise your hands, please. We all want to work for such people (laughs).
How many people think that leadership is innate, please raise your hand; How many people think that leadership is acquired? It seems that you are really the smartest people (laughs).
Indeed, leaders are made. Many important moments make leaders, and life experiences make leaders. Everyone here has a unique life experience and their own stories. There will be more than one kind of leader.
There is only one Steve Jobs. You must decide what kind of person you want to be and find your own nature. Leadership has many characteristics, and many experiences and even many textbooks will give definitions. But one trait I want to say, which I feel neglected, is to dare to show my vulnerability, especially to men.
It is difficult for a man to show his weakness in front of a large group of people. Cry, repent, apologize. What I have learned over the years is that the more vulnerable you are, the more people will come to you. Therefore, showing your vulnerability is a leadership trait, and I hope you can accept it.
Being a leader doesn't mean you have all the answers. Actually, asking for help is strength. If you want to build an excellent company, you must be surrounded by people with similar ideas, who are smarter, more experienced, more skilled and better than you, but you must have similar ideas.
I believe all of you here have your own dreams and ambitions, what to do to make your parents proud and go out from the best university in the world. Let's talk about dreams.
In the past 34 years, many people have told me, "I thought about doing coffee business like this." (Laughter) Really? So what did you do? I did it before you. Don't let anyone tell you that your dream can't come true. When I talk to young people, I always tell them to have big dreams and bigger ideas. Think of disappointment and failure as opportunities to learn more. Never give up, never refuse.
Everyone here has the ability, skills and opportunities to do some great things. No matter what your dream is, stick to it and don't follow other people's ideas. When you succeed, think about Ubuntu. You can sit here today because someone has helped you in your life. No one can sit here alone. Give back to your community and family. Keep learning and seeking knowledge.