Starbucks: Responding to Unionization Efforts

by: Andrew Hoffman

Publication Date: May 15, 2023
Length: 20 pages
Product ID#: 2-614-522

Core Disciplines: Leadership/Organizational Behavior, Strategy & Management, Sustainability

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Teaching Note

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In a little over a year, more than 6,500 workers at over 250 corporate-owned Starbucks stores had voted to unionize with Workers United. The former CEO, Kevin Johnson, retired unexpectedly in April 2022 after weeks of increasing pressure from investors as the unionization effort grew. Starbucks Founder Howard Schultz was then named interim CEO and he went on to make numerous statements against unionization and visited many Starbucks locations in an effort to curb unionization efforts. The next CEO, Laxman Narasimhan, was taking charge in April 2023, and Schultz would be his advisor through the rest of the year and remain on Starbucks’ Board of Directors. How Narasimhan managed the unionization efforts would be critical to his future at Starbucks.

The case’s fictional protagonist, the employee relations advisor, is assigned to counsel the corporation’s new CEO on how to respond. The protagonist, who started at Starbucks as a barista, can see many sides of the situation and is well aware that corporate leadership has resisted unionization, and knows that what comes next could be critical for Starbucks’ future.

Teaching Objectives

After reading and discussing the material, students should:

  • Examine Starbucks’ response to unionization and the impact on the company and its workers.
  • Identify issues relevant to equity, workers rights, corporate strategy, and profit.
  • Analyze the effectiveness of the unionization effort and which stakeholders benefit most.
  • Evaluate Starbucks’ strategic options and formulate a course of action for Starbucks and companies like it.