BIGGBY® COFFEE: The journey towards a people-centered company
By Kent Gregoire
March 26 - 2023
Coffee Geography Magazine
By now, research showcases overwhelmingly that purpose-driven companies have a clear advantage over their competitors, and not only when it comes to market performance. More and more businesses have realized that to earn the trust of their stakeholders, including their customers, they must rethink their obligation to society beyond simply making a profit for shareholders. Along with the rise of mission-driven leadership comes an abundance of business movements centered around purpose: Environmental, Social and Governance (ESG), Benefit Corporation (B Corp) certification, etc. As such, it can be difficult for leaders to understand exactly what it means to be driven by a succinct mission and to shift their focus from profit to purpose. For many, conscious capitalism or stakeholder capitalism is that umbrella appellation that integrates the belief in pro-capitalism while promoting social and environmental impact. Let’s dive deeper and take a look at a modern-day, purpose-driven business model in action.
Bob Fish and Mike McFall started BIGGBY® COFFEE in 1995 with the philosophy to have fun, be happy, love people, make friends and drink great coffee. From a single Michigan location in 1995 to becoming the fastest-growing coffee chain in America by 2008, the co-founding duo was encountering great success. Fast forward to 2014, and the company quickly achieved its early vision of being one of the largest specialty coffee franchises in America. But, Bob and Mike began to realize that their exponential growth came at a cost. They weren’t internally practicing the values they had started the company with. Instead, they had been breeding a culture of neglect where people were no longer at the center of their value chain. Gratefully, everything changed when Mike met Nathan Havey on a camping trip in Northern Michigan, in which he was introduced to the four tenets of conscious capitalism.
A Conversation with Nathan Havey:
Kent: Nathan, thank you for being here with me to talk about BIGGBY® COFFEE. Let’s dive right in–how did you encourage Bob and Mike to create a culture of care, trust and cooperation?
Nathan: It all started with a culture assessment at the BIGGBY® COFFEE corporate office in East Lansing in 2015. This was after Bob and Mike came to me seeking to create meaningful change within their company, with a single question on their minds: What could Biggby do that would change the world? So, the purpose of the analysis was to help us understand how BIGGBY® COFFEE was performing in the eyes of its stakeholders: its community, customers, vendors, the environment, shareholders and employees. In doing so, we found out that the company was passable in five of the six stakeholder categories and truly failed in one: its employees. Employees felt a deep lack of care and appreciation, accompanied by the pervasive sentiment of being undervalued and underpaid. Together, we concluded that Bob, Mike and four key director-level employees would benefit from some leadership training. I also recommended creating a new employee committee to improve the company’s compensation structure. My last recommendation was to read the most damaging parts of my report aloud in front of all staff members so that everyone felt like their voice had been heard and accounted for. From that point on, Bob and Mike relinquished their unilateral decision-making authority to a new leadership team consisting of themselves and the four director-level employees. They soon began to renew their personal relationships with their employees and form more authentic connections with one another. I repeated the culture assessment every year and, by 2017, the large majority of employees reported that BIGGBY® COFFEE treats its team well, a stark contrast from the “not great” response that transpired in 2015.
Kent: In addition to helping Bob and Mike establish a caring culture within their organization, how were you able to support them in adopting a stakeholder- orientation approach to doing business?
Nathan: Bob and Mike have been in the coffee business since 1995 and have sold nearly 17 million pounds of coffee that are sourced from countries in Africa, Asia and Central and South America. But Bob had been the Co-CEO of BIGGBY® COFFEE for more than 20 years before he ever stepped foot on a coffee farm. And, because the price of coffee is driven by a global commodity market rather than the cost of production, local farmers are the ones that end up getting the short end of the stick. In their stakeholder capitalism journey, Bob recognized that, with this approach, there was no incentive to invest in ethical farming or care for one’s broader community. This inspired him to combat this issue and change the relationship BIGGBY® COFFEE has with its suppliers. As such, they have developed a direct-to-farmer purchasing pipeline for their coffee beans. Bob and his wife Michelle Co-Founded a new organization called One Bigg Island in Space in which they search the world for farms that care for their people, the planet and their communities and forge relationships with the people who have built those farms. BIGGBY® COFFEE is committed to paying a sustainable price for its coffee by eliminating the brokers and middlemen between the company and the producers, and pushing those cost savings back to those farmers. Furthermore, by the end of 2028, the company aims to have 100% of the coffee beans they use in their stores come from those direct-to-farmer purchasing relationships.
Kent: We can hardly talk about stakeholder capitalism without discussing purpose. How, and when, did purpose come into the picture of your work with BIGGBY® COFFEE?
Nathan: As the center of a corporate culture, BIGGBY® COFFEE's purpose needed work. After achieving their initial goal of becoming one of the biggest coffee franchises, Bob and Mike had never set a new mission that would help guide their operations. To create a new one, we designed an inclusive process in which everyone in the corporate office was invited to participate. So, rather than having a small group come up with it, we all worked together to come up with a better plan that would be easier to implement because everyone helped create it. After almost a year of conversations, a clear purpose emerged: BIGGBY® COFFEE Exists to Support You in Building a Life You Love. And, they didn’t stop there–to better determine what exactly it means to ‘live a life you love’, the team worked together to identify four distinct measurable:
• Do you have a sense of belonging?
• Do you know who you want to be? Can you exceed your basic needs
• Do you have emotional and physical vitality?
BIGGBY® COFFEE went further still and agreed upon a vision that the company would achieve by the end of December 2027. They would set in motion events that would change workplace culture in America by achieving two results: 1.90% of people working inside the BIGGBY® COFFEE franchise system would emphatically agree that the company was supporting them in building a life they loved. 2.They would have grown 10x in the decade to cross $1B in revenue to scale their vision and mission. As of today, BIGGBY® COFFEE includes 340 open locations across the nation, with another 150 on the horizion. And today, Bob and Mike’s most important goal moving forward is to ensure everyone in the “BIGGBY® COFFEE Nation” – including baristas, employees and customers – would rate the company a 9/10 in its efforts to support them in building a life they love. The duo wants to demonstrate to the world the power that businesses can have to create supportive, nurturing environments for people, while simultaneously growing into extraordinarily successful brands. Bob and Mike hope that by supporting their team to create a life they love, BIGGBY® COFFEE will become a billion-dollar company so fast that people will pay attention and follow their lead, changing both the franchising industry and the world at large.
Kent: Organizations don’t do business. People do. Can you tell us more about how you supported Bob and Mike in their journey to becoming conscious leaders?
Nathan: The co-CEOs realized that to build a team of top talent, it was essential to create a culture that focuses not only on creating connections, but also enables employees to follow their own dreams. The duo soon shared their ideas for a company reorganization, which included the creation of a new initiative known as the Boost Team with the goal of furthering BIGGBY® COFFEE’s people, leadership and culture practices. They established a coaching program that, rather than turning employees into more efficient and valuable assets, was all about helping team members reflect, consider and pursue their passions so the company could support them in building a life they love. As this eventually evolved into a properly funded program, Bob and Mike realized that the team needed a name that represented the work they were doing and so, the Life You Love Laboratory was fully established in 2020, and its team is hard at work creating the tools that BIGGBY® COFFEE needs to realize its purpose and achieve its vision to improve Workplace Culture in America.You can see what they’re up to at https://biggby.com/b-involved/life-you-love- laboratory/.
Kent: Thank you, Nathan. There’s so much to take away from Bob and Mike’s experience. It’s clear that, as the business community transitions away from shareholder orientation, the companies that experience the most success are those that prioritize long-term value for all stakeholders. This creates a virtuous cycle in which the new standards for organizational performance revolve around the positive impact companies have, rather than how much money they make. Now, it’s up to each business leader to consider the unique ways they can support their respective stakeholders, and purpose is often the best guide. Here are my suggestions for those who want to follow in BIGGBY® COFFEE's footsteps to foster a people-centered culture:
Step 1: Complete an assessment to establish a baseline, such as the viral signs for the health of a business ecosystem, across all stakeholder groups. I recommend the Stakeholder Score, which measures six factors: collaborative relationships, helping people thrive, inclusion and equity, financial prosperity, environmental stewardship and company purpose.
Step 2: Review the assessment results to understand how your organization is performing for each stakeholder group. For Bob and Mike, Nathan’s assessment helped them identify that their weakest relationship was with their employees. It was only then that BIGGBY® COFFEE could begin to improve its company culture.
Step 3: Perform a cultural assessment to better understand your internal culture, its strengths and its challenges. In Bob and Mike’s case, this kind of feedback was pivotal for creating a company in which everyone thrived.
Step 4: As leaders, being vulnerable is essential to creating a culture of care, trust and cooperation. With that in mind, I encourage you to share the raw results of your assessments with your employees, much like Nathan instructed Bob and Mike to do at BIGGBY® COFFEE, and let them know how you plan to tackle the weak points of your company’s culture.
Step 5: Invite a group of impacted stakeholders to further explore the concerns you have with your culture and relationships, so you can work together to develop and implement solutions. I recommend starting with your employees if you are unsure of where to begin. Keep the group up to date with the progress and results of the solutions.
Step 6: Define and articulate your organization’s higher purpose. The key is to shift from helping with the issue that matters most to you, to aiming to solve that issue once and for all, which requires a completely different level of ingenuity and commitment. Almost always, “helping” is focused on alleviating the symptoms of a problem and does little to effect structural change that would eliminate the need for such effort in the first place. Solving, on the other hand, demands a nuanced and critical examination of the full spectrum of factors that create the problem at hand. It forces you to question your assumptions and expand your scope to find a feasible and sustainable solution.
At first, it can be difficult to shift to a multi-stakeholder approach, but it’s truly the most beneficial strategic decision you can make for your company. Leading with a higher purpose becomes your competitive advantage, and the engagement and retention of your stakeholders, including your customers and employees, will naturally follow suit. And, one thing is certain: the future of business relies on having deep relationships with all of your stakeholders.
Kent Gregoire – the Co-Founder of Stakeholder Business – is on a mission to help entrepreneurs transform their companies for maximum impact. In his consultancy work, he is known as the ‘CEO to CEOs’ who focuses on a win-win approach that delivers exponential value to all stakeholders. Kent is a serial entrepreneur, having launched his first manufacturing company at age 14. Since then, he has founded or led more than a dozen organizations, guiding several through successful exits and raising tens of millions of dollars in private capital for business acquisitions, start-ups and expansions. Kent has more than 35 years of experience providing advisory services to executive-level management, is one of the first certified conscious capitalism consultants in the world and is the President of the EO U.S. East Bridge Chapter. In addition to his work with Stakeholder Business, he is also the Co-Founder and CEO of Symphony Advantage in which he is focused on helping companies do well by doing good.
NATHAN HAVEY is the Co-Founder of Stakeholder Business and the Writer & Director of the associated acclaimed podcast mini-series, 10 Things You Should Know About Stakeholder Capitalism. Nathan is the Writer & Director of Beyond Zero, the feature documentary film on Interface, a global carpet company leading the sustainable business revolution. Nathan speaks to, trains and collaborates with people around the globe who are working to expand the game of business to create a world that works for everyone.