Starbucks Announces Leadership Change
In a significant shakeup, Starbucks has announced that Laxman Narasimhan will step down as the Chief Executive Officer (C.E.O.) of the coffee giant. This change comes just a year and a half after he took over the helm from Howard Schultz, marking the company’s third leadership transition in a short span of 18 months.
Narasimhan will be succeeded by Brian Niccol, a seasoned executive known for his successful turnaround strategies at Chipotle, where he served as C.E.O. for several years. Niccol, who is 50 years old, will not only take on the role of C.E.O. but will also become the chairman of Starbucks.
Starbucks has experienced a decline of over 20 percent in its stock value since Narasimhan assumed leadership, primarily due to sluggish sales in key markets like the U.S. and China. Additionally, Narasimhan has faced challenges from competing activist investor campaigns and has had to address criticism from Schultz himself. Following the announcement of Niccol’s appointment, Starbucks’ stock saw a notable increase of more than 14 percent in premarket trading, while Chipotle’s shares dipped by around 9 percent.
Additional Leadership Changes:
- Mellody Hobson, who played a crucial role in bringing Narasimhan on board, will remain on the board as the lead independent director but will relinquish her position as chairwoman.
- Rachel Ruggeri, the current Chief Financial Officer of Starbucks, will temporarily step in as C.E.O. until Niccol officially begins his role in mid-September.
Though Schultz, a three-time C.E.O. of Starbucks, was consulted during the selection of Niccol, he will continue to serve as chairman emeritus without taking on any additional responsibilities within the company.
In a statement, Schultz expressed his confidence in Niccol, stating, “Having followed Brian’s leadership and transformation journey at Chipotle, I’ve long admired his leadership impact. His retail excellence and proven track record in generating extraordinary shareholder value underscore the essential human element required to lead a culture- and values-driven enterprise.”
