In his candid new book, CEO Howard Schultz tells what went on behind the scenes in Seattle, and what he learned from the company's mistakes.
By Anne Fisher, contributor
FORTUNE -- Sometimes, it's the little things that drive you crazy.
In the summer of 2007, Starbucks (SBUX) was in the middle of its worst year ever.
Having stepped aside as CEO 7 years earlier to become a Bill-Gates-like, hands-off chairman instead, founder Howard Schultz often peered wistfully through the windows of closed-door conference rooms, "feeling like an outsider looking in," he writes in his new book (with co-author Joanne Gordon), Onward.
That would probably have been tolerable if the decisions cooked up in those conference rooms weren't so disastrous. But they were. Starbucks' day-to-day store traffic was "in free fall," Schultz recalls, tumbling to levels not seen in the company's 40-year history. The coffee leviathan had spread itself too thin, opening too many stores too fast, expanding willy-nilly into alien territory like the music business, and neglecting to build an online presence that could have given the company a way to explain some of its actions to its many critics.
Starting in February 2007 -- when Schultz wrote an infamous memo complaining about the "commoditization of Starbucks," which promptly got spattered all over the Internet -- the company's once-stellar stock began to slide, losing 42% of its value by the end of the year.
The last straw, however, was a small, irritating detail: The smell of burnt cheese. More
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