Indian-origin Laxman Narasimhan has now assumed role of the chief executive officer of global coffee giant Starbucks taking over from founder Howard Schultz. He will also join the company’s board of directors, Starbucks said in a statement. Narasimhan was named incoming CEO on September 1, 2022 and joined a month later. Narasimhan assuming the role of the CEO has come two weeks earlier than planned.
Laxman Narasimhan was formerly the CEO of FMCG major Reckitt and comes with nearly 30 years of experience across global consumer goods businesses. Now officially the CEO, Narasimhan will lead Starbucks Annual Shareholder Meeting on March 23, the company said in a statement, adding that he will “continue engaging the leadership team, sharing his early learnings and insights and assessing opportunities for the company as they chart a path forward.”
The company said that Narasimhan, over the past five months, embarked on an immersion experience, traveling to work with partners (employees) in over 30 stores, manufacturing plants and in support centers around the world. Interestingly, he also earned his barista certification along the way.
“I am humbled to officially step into my role as Starbucks chief executive officer, leading our incredible team of more than 450,000 green apron partners around the world. The foundation Howard has laid – building from scratch an iconic global brand fueled by a lasting passion to uplift humanity – is truly remarkable, and I am honored to have the opportunity to build on this deep heritage,” Narasimhan said.
“As a human connection business, we have limitless possibilities to deliver for our partners, our customers, our investors and our communities through every cup and every connection. I am excited to work alongside our partners worldwide to unlock the limitless future of Starbucks,” he added.
Narasimhan’s appointment came after Schultz – who retired and then returned as interim CEO in April 2022 – unveiled a company-wide reinvention strategy that included decisive actions and targeted investments in partners, customers, and stores that are expected to accelerate the company’s long-term growth, progressively expand operating margin, and drive high-teens non-GAAP EPS growth annually through fiscal 2025. Starbucks said at the time that the company expects comparable store sales growth to be in the range of 7 percent to 9 percent annually, both globally and in the U.S., up from the previous range of 4 percent to 5 percent from fiscal 2023 to fiscal 2025.
The company said it saw a 47 percent stock price increase since the Q2 FY22 earnings call through the Q1 FY23 earnings call, and market cap growth of approximately $40 billion during that same time.
“Laxman’s intensive immersion into the business coupled with his extensive experience as a proven brand builder, innovator and operator have uniquely prepared him to lead Starbucks into its next phase of growth,” Mellody Hobson, Independent Starbucks Board of Directors chair said in a statement.
“This immersion has deepened Laxman’s understanding of Starbucks culture and values. In this time of learning and listening, he has already won the hearts and minds of our partners around the world,” he added.
Apart from Narasimhan’s taking over happening ahead of schedule, it also comes 9 days ahead of founder and former CEO Schultz being scheduled to testify in a US Senate hearing over Starbucks’ labour practices on Mach 29.
