Starbucks CEO To Workers After Layoffs: We’re Not Effective

After laying off 1,100 employees from its 16,000-person corporate workforce in late February, Starbucks CEO Brian Niccol wants the company’s remaining workers to take ownership of their work to improve the coffee chain’s financial performance and turn around its lagging sales.

On Tuesday, Niccol gave his first address to employees since implementing layoffs at Starbucks’ Seattle headquarters. In a replay of the talk obtained by The Wall Street Journal, Niccol told workers that they “own whether or not this place grows.”

He added that workers should do a better job of promptly addressing customer complaints, including furniture issues, malfunctioning electrical outlets, and the amount of drinks accumulating on counters.

Starbucks corporate employees are getting bogged down by “too many follow-up meetings” about issues at stores, Niccol reportedly said, resulting in an overall lack of accountability.

Related: Starbucks Is Ditching Olive Oil Coffee From Its ‘Overly Complex’ Menu

“We’re not effective in making decisions and then holding each other accountable to those decisions,” Niccol said.

^{Brian Niccol. Photo by Ryan Miller/Getty Images for Orange County Museum of Art}

Niccol stated in the meeting that he was optimistic about Starbucks’ future and noted that the company’s U.S. stores are making changes, like adding ceramic mugs for people who want to stay in-store and limiting the number of items customers can order through mobile.

However, he also reportedly said that the company’s corporate operations could improve by having more employees work out of offices in the U.S. and Canada. Niccol famously travels nearly 1,000 miles from his residence in Newport Beach, California to Starbucks headquarters in Seattle (by private jet) to work from the office three days per week.

Starbucks allocates $250,000 in its annual budget to account for Niccol’s commuting expenses.

Around 40% of Starbucks corporate employees are remote, per the WSJ. Starbucks has a hybrid work policy in place for about 3,500 corporate employees.

Related: It’s Pay-to-Stay at Starbucks As the Coffeehouse Reverses Its Open-Door Policy

Starbucks has reported declining same-store sales (stores operating for a year or more) for four straight quarters. However, since joining the coffee chain in September, Niccol has implemented a “Back to Starbucks” plan to improve performance. This includes cutting 30% of its menu, adding new directives like making coffee in under four minutes, and writing customers’ names down with Sharpies on their cups.

Niccol noted in Starbucks’ most recent earnings report in December that the company has already “seen a positive response” from customers to the plan.

“We believe this is the fundamental change in strategy needed to solve our underlying issues, restore confidence in our brand, and return the business to sustainable, long-term growth,” he stated in the report.

Starbucks has more than 40,000 stores worldwide, with 16,941 in the U.S.

Related: Starbucks Has a Turnaround Plan That Includes Buying 200,000 Sharpies.