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Bill George

Harvard Business School Professor, former Medtronic CEO

Leadership Kudos and Gaffes: Howard Schultz builds long-term value at Starbucks

Leadership Kudos for the week go to Starbucks Chair & CEO Howard Schultz, who returned as CEO three years ago and has restored SBUX to its original coffeehouse feeling where baristas and customers have real relationships, not the assembly line feeling it had slipped into. Revenue and earnings growth have been restored, thanks to Schultz. And Howard has the courage to take a stand on our political impasse, buying full-page ads imploring people not to give to either party until someone puts country ahead of party. Who says leaders can’t stay true to their values and their roots and build great global franchises?

Leadership Gaffes this week go to Solyndra leadership and government officials who funded it. Solyndra squandered a $535 million government “loan” by building solar panels its customers didn’t want. Now it is bankrupt and can’t repay the loan. Maybe renewable energy companies should be held to the same economic tests that other industries are – of keeping their costs below their revenues without subsidies – and bring costs in line while innovating. A sobering experience for everyone who believes in subsidizing preferred technological solutions.