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How Starbucks Hires the Best

“The easiest way to ensure that your employees smile when they greet a customer, is to only hire employees who smile all the time.”

– Howard Schultz

Starbucks starting pay is not much more than minimum wage.

Employees have to clean toilets and are expected to smile all of the time.

Yet, it is perennially on most of the best places to work lists. And their turnover rate is half of the retail industry average.

How?

Last week we talked about how Starbucks continuously delivers excellent experiences to their customers. It is clear Starbucks has some great processes and those processes are part of how they deliver excellent customer service. It is also clear that they would not have a chance of delivering that service without great people.So how does Starbucks get such great people to work for them when the wages they pay are not much better than any other retail establishment?

Yes, they have a great hiring process, but that is not what attracts the best employees to apply at Starbucks. Below are the three big reasons Starbucks can attract, hire and retain the best people.

Culture

Like most great companies, Starbucks understands that great financial performance starts with a happy and engaged workforce. This people first mentality comes from the top of the organization, as you can see from the quotes below from CEO Howard Schultz.

“As I saw it, Starbucks had three primary constituencies: partners (what they call their employees), customers, and shareholders, in that order, which is not to say that investors are third in order of importance. But to achieve long-term value for shareholders, a company must, in my view, first create value for its employees as well as its customers.”

“We want people to join Starbucks who have like-minded values. We need happy people – we’re a people company that serves coffee, not the other way around.”

“To stay vigorous, a company needs to provide a stimulating and challenging environment for all these types: the dreamer, the entrepreneur, the professional manager, and the leader. If it doesn’t, it risks becoming yet another mediocre corporation.”

If you’d like to learn more about how values drive culture and culture drives profit go here.

Purpose or Mission

According to Glassdoor’s Senior Vice President of People, Allyson Willoughby, “Companies that rank the highest (in their best companies to work for survey) have a mission-driven company culture. People really feel like they have a purpose at their job every day. They say they’re making a difference in the world and changing things for the better. Almost every person on the planet would love that.”

Starbucks’s mission statement is “To inspire and nurture the human spirit – one person, one cup and one neighborhood at a time.”

From Starbucks’ website, “Connecting with each other, with our customers and the communities we are a part of fosters a deep sense of purpose at Starbucks. We believe we can all become a part of something bigger and inspire positive change in the world around us. That’s why we go out to do community service as a team throughout the year, partnering up with organizations to revitalize and enhance the neighborhoods we serve.”

To learn more about defining an inspiring purpose for your organization, go here and check out Day 3 of our Growth eCourse.

Perks & Benefits

Though perks and benefits are rarely what make employees happy in the long term, benefits are incredibly beneficial in attracting the best employees. Starbucks benefits are outstanding in the retail industry.

And more than just another way employees get paid, Starbucks benefits seem to be more of an indication of the value Starbucks places in their employees and in improving their lives.

The benefits Starbucks offers are not just bonuses and stock options. They do provide bonuses and stock options, but they also offer to pay for their employees’ college tuition and provide healthcare coverage to all employees that work at least 20 hours per week (I don’t know how much you pay for health insurance, but that is a $15,000 pay raise in my house!).

Starbucks also offers 401(k) matching, incredible training, sabbaticals and, of course, free coffee!

These benefits are proof that Howard Schultz means what he says when he talks about creating value for employees first.

These benefits, the culture and the purpose of the company attract great people to the organization and keep them there. Hiring great people, having low turnover and a great working environment creates a great culture. A great culture leads to happy employees. Happy employees lead to happy customers. Happy customers lead to happy shareholders! See the Values-Culture-Profit Connection.

You may not be able to match all of the benefits Starbucks offers, but I know you could give something extra back to your employees. What about your company’s purpose? Is there a greater reason to work at your company beyond a paycheck?