NAME: JOJIE A.

DADOR Course & Year: BSBA 3rd year

SUBJECT: CBMEC – STRATEGIC MANAGEMENT
CHAPTER 1 – World Greatest Strategists - Howard Schultz: Starbucks
Strategic Guides:
1. Study the biography of Howard Schultz, CEO of Starbucks. Include his childhood, if there is
something significant, his interests, his educational attainment, professional and career orientation,
and other facts that might have contributed to the success he is enjoying now.

Answer:
The childhood of the future billionaire was spent in the neighborhood of the houses
for low-income families, where there was nothing but the basketball court. Most of
the people over there were extremely poor and it is obvious, that the children from
this area was considered quite ordinary. That is why Howard always knew how
difficult it would be for him to break out of this poverty. However, his dream of
becoming successful was stronger than any obstacle.

Being a little boy, Howard often watched his father trying to find a job, which would
meet his expectations. When Howard was seven years old, his father broke a leg
while being at work. As he had no medical insurance, the subsequent family
financial difficulties left an indelible mark in the boy’s memory.
“I saw my father losing his sense of dignity and self-respect. I am sure that this was
caused mostly by the fact that he has been treated as an ordinary working man.” –
Howard Schultz recalls

At the age of 12, Howard got his first job. First, he was selling newspapers, and then
working in a local cafe. The boy faced rather hard experience when he turned 16.
He was working at the fur store, where he had to deal with stretching the leather.
This exhausting job only made Howard stronger and firmed his wish to succeed in
future. Being physically strong, Schultz excelled at sports and was awarded an
athletic scholarship to Northern Michigan University where he received his
Bachelor’s degree in Communications in 1975.
After his graduation, Howard Schultz spent three years as a sales manager at Xerox,
and then he started working at a Swedish company Hamamaplast, where he was
selling home appliances, including coffee grinders to the businesses like Starbucks.
Once Schultz discovered, that this little company orders way more of his coffee
machines then some popular stores. Howard decided to meet the owners of
Starbucks and went to Seattle.
2. Study the beginnings of Starbucks, the challenges it encountered through the years, and its journey
toward success.

Answer:
The store opened in a quiet inconvenient time: at the end of the 60s, the Americans
completely gave up on instant coffee. Moreover, the majority of them did not even
know that there is some different type of coffee, which is other than instant. Thus,
there was not too much of the visitors.
Howard saw a great potential of the business and
realized that he wanted to connect his life with Starbucks. Thus, he agreed to work
there even under such inconvenient conditions. In 1982, he moved to Seattle.
In 1983, Howard went to Milan and returned with the recipes of latte and
cappuccino, which tripled Starbucks’ sales over the next year. However, the concept
of Italian café amazed Schultz the most – it was not just a store but a place for
social meetings and leisure. In the United States the socializing role was mostly hold
by the various fast-food restaurants. Schultz spent long time thinking of this totally
new concept, when in 1985 he proposed Baldwin to make a focus on creating a
network of coffee houses. But the CEO of Starbucks answered with categorical
refusal. The founders believed that such approach would cause their shop to lose its
individuality. They were the men of traditional views, which supposed real coffee to
be made at home. But the idea of drinking coffee out literally elated Schultz, and
he, being confident in his venture, resigned from the company to open his own
business.
Howard Schultz remarks, “Only those who go by unexplored roads, creating new
industries and new products, can build a strong, long-lasting company and inspire
others to achieve great results.”

3. From the management, result-driven, practical, and inspirational strategies implemented by Schultz
at Starbucks, which you as something worth imitating? Explain your answer.

Answer:
He carefully thought on the strategy and to tell the truth, it was quite insane. To turn
over the minds of Americans, Schultz decided to make accents on the quantity,
quality, and publicity. Marketing team of Starbuck were constantly telling Americans
that drinking true coffee at Starbucks is romantic. Advertising slogans were easy to
memorize, causing a smile and the thought of a cup of this flavored drink. The head
of the company made sure that this advertising is not different from reality.
Howard Schultz offered a democratic coffee house, which worked on the principle of
self-service. Here, the customer had a freedom of choice: the type of a drink (not
just coffee, but latte, cappuccino, espresso, mocha, macchiato and other
alternatives), the size of a cup, and the type of milk (regular or fat-free) completely
depended on a choice of the visitor. This approach has given their customers an
opportunity to order a quite individual drink. At some point, it also caused the
emergence of a new slang: the order may sound very floridly, like ‘double tall skinny
decaf latte’.
The fact that the coffee shop is ruled by the principle of self-service did not scare
the customers. At Starbucks, an order is taken by one person, and another staff
member prepares the drink. It makes the system quiet fast, especially if to compare
it with some fast-food restaurants.

Howard Schultz came up with a

set of rules of Starbucks, which later evolved into the corporate code. It was
pointing on the benefits given by a well-organized teamwork, and the need of
continuous improvement of coffee quality. Its final statement was, “Remember, that
making a profit now, we are laying the foundation for our future prosperity.”
From Howard Schultz biography we have found out that while developing Starbucks
at the national level, Howard Schultz paid an excessive attention to the human
factor. But Howard himself calls it the most intelligent and far-sighted model of
acting. He stated that if people are associated with the employing business, they
are forming an emotional relationship; they dream with it and put their hearts in its
prosperity.
Name: JOJIE A. DADOR Course & Year: BSBA 3rd year
Subject: CBMEC – STRATEGIC MANAGEMENT
CHAPTER 1 – World Greatest Strategists – Tadashi Yanai : Fast Retailing
Strategic Guides:
1. Study the biography of Tadashi Yanai, CEO of Fast Retailing. Include his childhood, if there is
something significant, his interests, his educational attainment, professional and career orientation,
and other facts that might have contributed to the success he is enjoying now.
- Tadashi Yanai Early Career. He was born on the 7th of February 1949, Yanai was passionate about
pursuing business from the initial years. He graduated from the Waseda University in Tokyo in the
year 1971 in political science. After finishing his graduation, he started by selling men’s clothing
and kitchenware at the Jusco Supermarket. After spending a year at Jusco, he quit the job, joined
his father tailoring business known and named it as Ogori Shoji.
Yanai moved to start his first Uniqlo’s shop in the year 1984 in Hiroshima. His sense of intuition
and the free reins made it much easier to take good advice. In just a time span of ten years, the
little suburban shop opened dozens of other shops and led the IPO in the year 1994.
As of now, Fast Retailing has more than 2000 stores under its name and has become the fourth
largest apparel company in the entire country. The company even includes a number of brands
under its umbrella starting from including Helmut Lang, Comptoir des Contonniers, and others.
In the year 2012, he was included in the 50 most influential list of Bloomberg Markets Magazine.
He has also been bestowed with the international Retailer of the year award in the year 2010 from
the National Retail Federation in the US. Sanno Institute of Management chose Yanai as the best
company president in the year 2009.

2. Study the beginnings of Fast Retailing, the challenges it encountered through the years, and its
journey toward success.
- And he’s tried many things since, of course, and succeeded. He is now the most successful
businessman in Japan, sitting on top of Fast Retailing which holds Uniqlo as a subsidiary. He
opened the first Uniqlo, then called the Unique Clothing Warehouse, in Hiroshima in 1984 when
he became president of his father’s clothing chain. Says Yanai, “At that time I thought I found a
gold mine. I thought we could have a very successful business running Uniqlo stores all over
Japan.” He was right. He grew the business fast: opening more than 300 stores across Japan in just
four years.
- Yanai was never one to get scared of making mistakes, a true quality of a visionary. “When we
became successful in Japan, we ventured out to build our store in London. At that time we
experienced doubling of our turnover: so 100 billion [yen] became 200 billion [yen, which became]
400 billion. In a matter of two or three years, our turnover was from 1 billion dollars to 4 billion
dollars—that’s what we experienced in Japan. So that encouraged Yanai to go to London and have
 a new store. The store was reasonably successful as a matter of fact. As a business at large, it was
a disaster.” He said it was caused by building a gigantic headquarter in Europe, a suggestion from
his managers who were ex Marks and Spencer people. “That was a failure,” he says now. “That
was a disaster.”
“We are passionate about offering clothing that is appreciated by everyone in the market place,"
explains Yanai about this merging of two cultures within Uniqlo, his most successful brand (under
Fast Retailing, there is also Helmut Lang, Theory, and J Brand among others). "We wanted to make
sure that our products are geared to all types of people: whether they are billionaires, the middle
class, the lower end. We need to cater to all, just like Marks and Spencer or Gap or the current
H&M and Zara. Unless we cater to all segments of life and segments of people, we cannot be
successful.” Yanai Said.

3. From the management, result-driven, practical, and inspirational strategies implemented by Yanai at
Fast Retailing, which struck you as something worth imitating? Explain your answer.
Yanai has built a retail empire by producing a range of apparel that has something for everyone.
UNIQLO’s insistence on high-quality basics over fashion-forward cuts has earned it respect throughout
the sartorial world.
That strategy has also made Fast Retailing, the group company that owns seven apparel brands
including UNIQLO, hugely successful. With annual revenues at roughly $17 billion in fiscal year 2016,
Fast Retailing has set its sights on becoming the world’s number one apparel company. But Yanai has
never lost sight of the values he instilled when he opened his very first store in 1984: hands-on
leadership, empowering his employees, and doing good in the world.
As UNIQLO has grown, Yanai has leveraged the company’s popularity to help the worlds neediest.
UNIQLO works with the United Nations High Commissioner for Refugees, donating over 20 million
articles of clothing to refugees in 62 countries and regions as part of its All-Product Recycling initiative.
And Yanai has personally donated $10 million over three years to help the UNHCR respond to various
humanitarian crises. UNIQLO also strives to be on the cutting edge of sustainability, working to
minimize impact by eliminating waste and reducing its environmental impact.
UNIQLO’s combination of business success and extraordinary generosity follows directly from Yanai’s
simple — but powerful — worldview. “The world doesn’t need anybody except for those who do good
things for it," he says.
Yanai is renowned as an inspirational leader, but is as humble as he is ambitious. He told Monocle
magazine, "I might look successful but I've made many mistakes. People take their failures too
seriously. You have to be positive and believe you will find success next time."