Repairing the damaged U.S. economy will surely be among the top priorities of President-elect Obama's new administration. But it is not reasonable to assume that our great country's future economic prosperity lies in the hands of one man, or will necessarily follow simply from a change of administration in Washington.
Despite the mistrust that American businesses have engendered as of late, history suggests a different truth: that while government can create a framework and conditions that will support positive economic change, it is American business that will turn things around, and deliver the prosperity and sustainable economic stability and security that can follow.
But today, an increasingly challenging economic climate around the world and a historic decline in consumer confidence at home are combining to cause many business leaders to stop leading their businesses forward. They have become fixated on the short term. And when short term results alone drive or unduly influence management decisions, the temptation to push off sound longer-term investments, those that will fuel innovation and strengthen the enterprise for the future, can become overwhelming.
With that mindset comes the false belief that investments in people and training can wait; that corporate social responsibility can be put on the back burner.
I believe passionately that this is precisely what American business leaders should not be doing today. Now is the time for business leaders to step up ... and to lead. Just as the American public voted on Tuesday for a sea change in the way our country approaches the long-term "business" of being America, so too do business leaders have an obligation and a responsibility to think of the long-term benefit their companies must provide for shareholders, employees and customers.
Today, perhaps more than ever before, we need to remind ourselves where we came from, what we are about, what we stand for and where we are going. We must recommit ourselves to living up to the principles and the core values that helped us establish our businesses in the first place.
Now is a time to be bold. Now is a time to invest, truly and authentically, in our people, in our corporate responsibility and in our communities. The argument--and opportunity--for companies to do this has never been more compelling. A recent opinion piece by former Vice President Al Gore Jr. and David Blood makes this point eloquently. "Sustainability and long-term value creation are closely linked," they wrote earlier this week in the Wall Street Journal. "Business and markets cannot operate in isolation from society or the environment."
I share that belief, and it has guided me and my partners over the past three decades, as we have grown Starbucks into the company it is today. Sure, we are the first to admit that Starbucks is by no means perfect. We have made our share of mistakes. But I can tell you unequivocally that as Starbucks confronts today's economic challenges, it will do so while remaining true to our principles and fostering a culture that genuinely embraces our collective humanity.
Last week, Starbucks gathered 10,000 of our store managers together for a leadership conference in New Orleans. I am proud to report that among many other benefits of the conference, our leaders performed more than 50,000 hours of community service in that still-struggling city. During the conference we also announced a set of ambitious but realizable goals for the way we source our coffee, how we help to sustain our environment, and what we can do to work with, and continue to contribute to, the communities in which we do our business and the world as a whole.
Despite the tight economic conditions, we made this significant investment in our people now for the same reason many companies would consider eliminating it: the current climate is yielding more discerning and thrifty customers. Consumers are spending less and will more closely scrutinize products; they will embrace only the companies and brands they trust and with which they identify.
Consumers develop a memory based on their experiences, and it is critical that business remains sensitive to that reality -- particularly in times like today -- and to not just be pushed along, or off course, by economic tailwinds or cross currents.
While I believe that an approach that values people as much as profit is in step with where we are as a nation, some may say that this approach is counter-intuitive. Others may claim that it is the opposite of the standard MBA playbook during a down cycle.
But in my view, the approach Starbucks is committed to is the only one that will enable us to deliver long term value to shareholders, partners and customers. And I am convinced that other companies whose leaders embrace this approach will reap meaningful, long-term rewards as well.
Last Tuesday's election results mark a new page in our collective history. And while U.S. businesses are in the midst of extremely challenging times right now, I have no doubt that the core strength of American ingenuity, and the courage of American business leaders, are the engines that can propel our country and the world back onto the path of prosperity.
If we believe in ourselves and remain true to our core values we will all succeed. Today perhaps more than ever before, I am convinced that responsible capitalism is the way forward.
Howard Schultz is Chairman and CEO of Starbucks Coffee Company.