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I spent five years at Forbes writing about business and leadership, attracting nearly one million unique visitors to Forbes.com each month. While here, I assistant edited the annual World’s 100 Most Powerful Women package and helped launch and grow ForbesWoman.com. I've appeared on CBS, CNBC, MSNBC and E Entertainment and speak often at conferences and events on women's leadership topics. I graduated summa cum laude from New York University with degrees in journalism and sociology and was honored with a best in business award from the Society of American Business Editors and Writers (SABEW) in 2012. My work has appeared in Businessweek, Ladies’ Home Journal, The Aesthete and Acura Style. I live in New York City with my husband and can be found on Twitter @Jenna_Goudreau, Facebook, and Google+.

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Starbucks' Secret Weapon

This story appears in the November 21, 2011 issue of FORBES magazine.

StarbucksSeattle headquarters is a temple to coffee, with walls of muted espresso-colored woods enclosing trees ripe with coffee cherries and barrels of roasted beans. But one floor stands apart. Two flights up, where Michelle Gass has been transforming Seattle’s Best Coffee, there’s an explosion of bold reds and oranges, with silver streamers dangling from the rafters and discarded party hats from a weekly coffee tasting.

“We are so serious about our coffee. We love coffee,” says Gass, 43, eyes wide, a 15-year Starbucks veteran. She loves shaking things up, too. She led Starbucks in a new direction in 1996 by making a huge success of Frappuccino, now a $2 billion brand. She ran the company’s big turnaround for Chief Executive Howard Schultz after he returned to the top job in 2008. She led Starbucks to triumph in the usually reviled world of instant coffee with the introduction of VIA in 2009. Now she’s going to run Europe, the Middle East and Africa for the company.

In early 2008, after Starbucks’ sales started free-falling—a collision of market saturation, a tanking economy and fierce competition from McDonald’s and Dunkin’ Donuts—Schultz’s very first organizational change was to appoint Gass, then the youngest member of a mostly male executive team, to be his chief strategist. “Michelle is a courageous leader with a rare combination of business and interpersonal skills,” he says. “She was the perfect person to be at my side as we coauthored the transformation of the company.”

She helped restructure the operation and reinvigorate 137,000 employees in 17,000 stores. “I love a great challenge,” she says, beaming. “It was a very unique role, with an ability to have a huge impact.” Working side by side, she and Schultz created a “transformation agenda” with seven big moves. They shuttered 900 stores worldwide, cut almost $600 million in costs and closed every single cafe for three hours to retrain baristas while tightening operations to improve coffee quality.

At the same time, thirsty for new revenue streams, Schultz turned to a decades-in-the-lab formula for instant coffee. He wanted to roll it out as soon as possible and leaned on Gass. “I felt so much pressure to get the details right,” she says. She pored over marketing research even as “some of our own people said, ‘That’s crazy! You’ll denigrate the brand.’” She concluded they needed more time, so she and a colleague went to Schultz and said, “It’s too early. We’ve got to test this.” He acquiesced. “Michelle has strong views, but that’s what I want in a leader,” Schultz says. During test marketing she had a critical insight. The term “instant coffee” repelled people. She decided to reframe it as “Ready Brew.” Later, in a whiteboard session, someone floated the idea of a challenge: pitting fresh-brewed Starbucks against VIA instant to see if customers could tell the difference. “Now, that’s a big idea,” she said, pouncing.

“It was audacious,” recalls Chris Bruzzo, senior vice president of Seattle’s Best. “It got people nervous. But it took someone like Michelle to see the opportunity and then bring an entire organization through the curve of believing.” Sales hit $100 million just ten months after the nationwide launch.

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  • erinlynn erinlynn 3 years ago

    Great piece! Several years ago I worked for Seattle’s Best and as a consumer prefer their softer flavors over Starbucks’. At the time Seattle’s Best had indeed snubbed Starbucks and overportioning their beans to “zap” customers instead of offer a superior flavor. I had no idea at the time that it was part of the same family. Interesting!

  • Tim Ferguson Tim Ferguson, Forbes Staff 1 year ago

    She was just reassigned from Europe: