This post is part of a series on Starbucks Lean Operations. The series of posts can be found here:
- Starbucks, Why Lean, Why Now?
- Starbucks Lean Thinking, Turnaround, Alignment to Transformation Agenda
- Lean, Starbucks, Change Management and Resistance, Fiefdoms and Stores
- Starbucks Coffee, Queueing Theory, and Theory of Constraints
In our previous post on Starbucks, Why Lean, Why Now?, we learned about the Transformation Agenda set forth by Howard Schultz and showed how Lean aligns with several items on the Starbucks Transformation Agenda.
As far as Starbucks has shared with the public, we roughly know the strategy, the Starbucks Transformation Agenda, and where Lean fits into the picture. Now, we need to ask:
Though Starbucks is still early in their Lean journey, are the results aligned to the original Transformation Agenda?
Here are a few results so far. In a Wall Street Journal report, Scott Heydon, says the following (source: goo.gl/Y5mX):
Motion and work are two different things. Thirty percent of the partners’ time is motion; the walking, reaching, bending,” he says. He wants to lower that.
So, when 1/3 of a Starbucks’ partner’s time is spent on activities the customer would consider as non-value-add, that prevents that partner from connecting with the customer.
Countermeasure: identify non-value-added activities and systematically identify their root causes and reduce or eliminate those steps.
[…] “I thought it was going to be the best station in my store,” Jordan says. “What I saw was how much my partners were moving and reaching for things that were never in the same place. It took way too long to make one beverage,” she says.
They moved all but the most commonly ordered syrup flavors and now store pitchers closer to where the drinks are made. After learning that topping the drinks with whipped cream and chocolate or caramel drizzle at the drink station was slowing down production, they moved those items closer to where drinks are handed to customers. The changes shaved eight seconds off the 45-second process. “Just to top the beverage with whipped cream and drizzle took six seconds,” Jordan says.
In all, new methods have cut two seconds off the store’s drive-through time — to an average of 23 seconds.
On the surface, 23 seconds might not seem much, but in aggregate it is a significant savings. Moreover, time savings allows Starbucks to serve an additional customer – in other words: revenue they would not have had if they had not made the layout and process improvements.1 2 3 4 5
Countermeasure: co-locate necessary and affinity ingredients closer to each other, eliminating unnecessary motion, walking, and reduces the time to complete a drink.
[…] Earlier this year, Heydon accompanied regional directors to New York. At one store, the barista made about 40 trips back and forth before the store opened — carrying baked goods from one end of the shop, where they were delivered, to the pastry case at the other end. Time clocked: one hour and 15 minutes. Heydon and the store’s manager came up with changes including rolling a pastry rack next to the case. Efforts at other stores have shaved an average of an hour-and-a-half off the task per store per week.
Similar to the scenario above, there was much unnecessary motion, leading the Starbucks employee to reach fatigue sooner than expected, hindering performance.
Countermeasure: through effective and simple brainstorming, the Starbucks crew made changes to the process, reducing 1.5 hours off the task per store per week. In other words, that’s 1.5 hours the Starbucks employee gets back to better serve the customer, serve more drinks, or in other value-add activities. Additionally, the process changes improved safety conditions for the workers.
In another memo, Howard Schultz explained steps that Starbucks took that led to commoditization of the brand – a step that needed to be reversed to regain brand equity (source: goo.gl/TCKf):
For example, when we went to automatic espresso machines, we solved a major problem in terms of speed of service and efficiency. At the same time, we overlooked the fact that we would remove much of the romance and theatre that was in play with the use of the La Marzocca machines. This specific decision became even more damaging when the height of the machines, which are now in thousands of stores, blocked the visual sight line the customer previously had to watch the drink being made, and for the intimate experience with the barista. This, coupled with the need for fresh roasted coffee in every North America city and every international market, moved us toward the decision and the need for flavor locked packaging. Again, the right decision at the right time, and once again I believe we overlooked the cause and the affect of flavor lock in our stores. We achieved fresh roasted bagged coffee, but at what cost? The loss of aroma — perhaps the most powerful non-verbal signal we had in our stores; the loss of our people scooping fresh coffee from the bins and grinding it fresh in front of the customer, and once again stripping the store of tradition and our heritage?
As a response to the mis-steps Howard Schultz describes above, grinding beans is now a requirement. But, that means the making of coffee might take longer. So, the Starbucks team turned to Lean Thinking as a guide:
[…] Now, baristas are required to grind beans for each batch and timers buzz every eight minutes to signal when it’s time to make new coffee. At a busy downtown Chicago Starbucks, store manager Ryan Dobbertin says bins of beans are kept on top of the counter so the baristas don’t have to bend over; bins are color-coded, so they can find a particular roast without having to pause and read the label. They also use different colored tape to quickly differentiate between pitchers of soy, nonfat or low-fat milk.
At the beginning of April, Dobbertin’s store had a customer-satisfaction score of 56%; by June, it had jumped to 76%. His store has seen a 9% increase in transactions between April and June.
Countermeasure: use Standardized work, Visual Management, and simple and smart layout redesign to reduce non-value added work and increase value-added work. All this must be done with the constraint of grinding fresh beans per batch – because it meets the Starbucks brand promise.
More Substance, Less Froth
In conclusion, I attempted to visit history to remind ourselves of the business conditions that led to Starbucks adopting Lean Thinking. Then, I attempted to show how Lean Thinking fits with the Starbucks Transformation Agenda. Given the early results from the Starbucks Lean implementation, I tried to show how those results are aligned to Howard Schultz’s original Transformation Agenda.
No Lean implementation is perfect and neither is it at Starbucks. In the proceeding posts, I’ll outline some of the items that I think could help Starbucks – especially how to earn more buy-in from the store partners and the baristas.
- here are some details on the beverage repeatable routine (source: goo.gl/HM4U ↩
- Brew Station: Beans are now ground on demand, in an exact amount for just the next brew batch, just prior to brewing. Beans are spoodled (same sizes:1 = qtr batch, 2= half batch, etc.) directly into the grinder and then ground into small paper bag, Contents of bag are then directly deposited into filter and brewed. No un-used grounds are discarded at the end of day. Coffee is continuously being brewed and urns are in continuous rotation. Depending on the time of day/number of coffees being brewed timers are re-set to reflect: 3 coffee offerings (morning: bold/pike/decaf): every 7:30 minutes 2 coffee offerings (mid-day: pike/decaf): every 12 minutes 1 coffee offering (night: pike): every 25 minutes. When timer beeps, urn is moved into next brew station position and next coffee is brewed. No coffee is discarded until a new batch of the same type is brewed. The objective is to always have fresh coffee available – to not run out of any type, especially during morning rushes. (Exception of course at night when bold & decaf are only brewed upon request). Baristas are encouraged to over-brew coffees in the morning (full batches) even if not fully sold in order to keep supply ready & available. This is compensated for by under-brew of coffees in the evening (quarter batches or less) ↩
- Point of Sale or Cash Registers: All registers (both drive-thru & cafÃ©) are now tied to sticker machines that automatically print labels for drinks – NO MORE MARKING CUPS. The labels indicate which barista took the order so the finished drink is routed to the appropriate customer (drive thru vs. cafÃ©). SLEEVES are only used for cups with hot water based drinks (i.e. Americanos, Teas and at the barista discretion, coffee). Otherwise, they are available upon request only at the drive-thru or in a small self-serve container at the hand off plane/condiment bar. ↩
- Espress Bar: All production elements for both hot & cold bar are integrated into one station- there is no more stand-alone cold-bar or double-barring. The BARista makes all the drinks- except for hot teas & pouring coffee, which the register partner still handles. If the store has a Sure-Shot or frapp mix dispensing machine, this is now moved next to the espresso machine and will hold 2% and Non-Fat Milk. Frapp bases are now kept in old-school style in pitchers in refrigerators. Blenders are within arm’s reach of espresso bar. For Sure-Shot less stores, galloons of milk are kept in ice-bath bins with two hour timers next to espresso machines. This is to eliminate barista bending,etc. to pull milk from fridges. There are only 3 types of steam pitchers: MILK (all types + signature hot chocolate mix & half-half/breve), NON-MILK (all fruit juices & soy) and WATER (to hold hot water from insta-tap for chais & americanos- instead of pouring from insta-tap into cup). Make each drink individually. Steam only enough milk for one drink at a time- use the least amount possible with no overage. (If you have 2 tall lattes in a row, still steam milk for one, and then the other- not venti size for both split in half). And press button to start pouring shots into cup BEFORE starting to steam milk. All steam pitchers are to be used once, to make one drink, then rinsed. After each drink, wipe steam wands clean with sanitized cloth and blow steam wands out. No thermometers are used except for kid temperature drinks and drinks with special temperature requests. Whip Cream canisters, plus mocha & caramel drizzle bottles are kept introverted in containers on bar counter- ready to dispense. The objective is to reduce the average time it takes to make a drink to under a minute. ↩
- STARBACK Deployment: During morning rushes, a Starback or SuperFloater is deployed. This partner is to have no direct contact with the customer and is not to have direct interaction with the drink production. This partner’s duties are to: Brew Coffee (so register partner stays forward facing/customer order ready), Rinse Steam Pitchers (so bar partner stays planted at espresso station), Insert items in warming oven (if applicable/as needed), Check condiments bar as needed, Stock backline as needed, Make prep as needed, CafÃ© Sweeps/remove trash/clean up spills as needed, Bar partners still place stickers/prep cups and Register partners still pull pastries/pour coffee; however in stores with only 3 partners deployment in morning, Starback may assist with these duties as needed. ↩