Starbucks vs Target: The Right Way to Handle Return-to-Office Mandates | Fast Five Shorts
This week on the Omni Talk Retail Fast Five podcast, sponsored by the A&M Consumer and Retail Group, Simbe, Mirakl, and Ocampo Capital, we analyze contrasting approaches to return-to-office policies.
Both Starbucks and Target issued return-to-office orders this week, but with very different strategies. Starbucks mandates employees work in the office a minimum of four days a week (Monday-Thursday) starting in October, even offering voluntary exit packages for those who refuse. Target takes a softer approach, asking team members to work in person at least three times a week with flexibility on which days, leaving decisions to individual leaders.
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⏩ Topics Covered:
📌 00:00 – Headline Details
📌 01:30 – Starbucks' Hard Line: 4 Mandatory Days
📌 04:15 – Target's Flexible 3-Day Approach
📌 07:20 – A&M's David Brown on Best Practices
📌 10:45 – The Importance of Standardized Days
📌 13:30 – Corporate Culture Alignment Strategies
📌 16:10 – Impact on Productivity & Collaboration
For the full episode head here: https://youtu.be/sgweq_AtMms
#returntooffice #starbucks #target #workplacepolicy #hybridwork #remotework #corporateculture #retailleadership #productivity #omnitalk
This podcast uses the following third-party services for analysis:
Podcorn - https://podcorn.com/privacy
Transcript
Both Starbucks and Target issued return to office orders this week, according to local Minneapolis NBC affiliate Carol Levin.
Speaker A:Shout out to Carol Levin.
Speaker A:Target's Chief Commercial Officer Rick Gomez said that starting September 2, he's asking all team members to work in person at least three times a week, adding that there will be flexibility, including allowing employees to decide which three days to work in person.
Speaker A:Sounds a little half pregnant to me.
Speaker A:Target reportedly doesn't mandate its employees to work remotely or in person.
Speaker A:Rather, individual leaders make the decisions based on what's best for their teams.
Speaker A:Starbucks, in contrast, said employees will have to work in the office a minimum of four days a week, Monday, Tuesday, Wednesday and Thursday, starting in October.
Speaker A:The new requirement, which is up from a previous one of three days, applies to workers in Starbucks Seattle and Toronto support centers, as well as North American regional offices for workers who decide to opt out and leave the company.
Speaker A:Instead of meet the new four day requirement, Starbucks is offering a quote, one time voluntary exit program with a cash payment.
Speaker A:End quote.
Speaker A:David, lots of companies are instituting back to office policies this week.
Speaker A:Some mandating four days like Starbucks, others like Target, keeping it loose as far as when people need to be in the office for their three expected days.
Speaker A:Is there a best practice across the industry at this point or how should retail executives think about this challenge?
Speaker B:Yeah, this is a super interesting one, Chris, to me.
Speaker B:Like, I, I don't know if there's a best practice.
Speaker B:I, I will say this, that the majority of my clients, and I think our clients are moving back towards us.
Speaker B:Right.
Speaker B:And you know, being in the office more, I don't think it's going back to five days a week anytime soon.
Speaker B:I, I do think there's been some lessons learned about that.
Speaker B:You can have some remote workforce and there's a, a work life balance that just naturally comes with not being in the office five days a week.
Speaker B:But on the flip side of that, I will tell you that the clients that I see that are in the office more, collaborating, more, just being in the same room to make big decisions, are more productive, they're more efficient, and I actually think they make better decisions because there's just something about the human element that is missing on, when you're, you know, three, four, five days a week on, on zoom calls, you don't build relationships as well.
Speaker B:You really can't have as active a debate where you're, you know, getting super demonstrative or whatever in the room, you know, being very Italian and talking with your hands, but.
Speaker A:Right.
Speaker B:I never thought about that.
Speaker B:Yeah, yeah.
Speaker B:So I'm surprised it's taken this long, quite frankly, kind of.
Speaker B:Um, but I do think, you know, if I was to think about kind of a best practice, and if it was.
Speaker B:It was my company, you know, I would probably have three, four days a week and with some flexibility, because I think there is huge value to.
Speaker B:To being in person now.
Speaker B:Yeah.
Speaker B:Do I hate, you know, traveling as much now again as I.
Speaker B:As I do and being away from the family?
Speaker B:Probably.
Speaker B:Sure.
Speaker B:But.
Speaker B:But.
Speaker B:But I do think for the companies, there's.
Speaker B:There's value.
Speaker B:Yeah.
Speaker A:There's puts and takes with every job, really.
Speaker A:At the end of the day, David, let me ask you, because we put both of these headlines in on purpose, the Starbucks and the Target dichotomy in terms of how they're handling it.
Speaker A:Do you think?
Speaker A:I'm curious.
Speaker A:Do you approve of one approach over the other?
Speaker A:Say Starbucks saying you have to be in these four days, whereas Target saying, like, it's up to the individual manager's discretion which three days of the week they want to be in.
Speaker A:You know, how do you think about that?
Speaker A:Is there.
Speaker A:Yeah, right.
Speaker A:Or a wrong way to do.
Speaker B:Yeah, no, I do think there is a right way.
Speaker B:I do think if you're gonna, you know, pick some minimum number of days, you have to define those days.
Speaker B:Otherwise the standardized days, three days.
Speaker B:Right.
Speaker B:You know, that leaves 40% of the time.
Speaker B:And if you do the math.
Speaker B:And I'm not gonna do the math right now, but you.
Speaker B:You could end up with one day a week overlap.
Speaker B:Right.
Speaker B:And, you know, what have you really accomplished there then?
Speaker B:Right.
Speaker B:You know, set the operating rhythms of the company and, you know, set a series of meetings where people can be together.
Speaker B:And I'm not a huge advocate of meeting just for meeting sake, but, like.
Speaker B:But if you're going to have the benefit of people being in the office, you actually have to have them in the office together.
Speaker B:So I would mandate, you know, whether it's Tuesday to Thursday or whatever, but.
Speaker B:But I would go to the mandate route.
Speaker A:Yeah.
Speaker A:Otherwise, you're on.
Speaker A:You're in the office on Zoom with many people still.
Speaker A:And I saw you shaking your head.
Speaker A:Do you agree with that?
Speaker C:Yeah, I mean, I think it's just.
Speaker C:It seems like it's actually more work when you don't specify what the days are like on top of just what David was saying, trying to make sure that you're getting zoom calls coordinated when people are not in the office.
Speaker C:Like now, you have to have that extra layer for each one of those managers to figure out.
Speaker C:And I just think like that it also seems a little disruptive to the whole organization too.
Speaker C:Like, I think the Starbucks approach makes much more sense.
Speaker C:Like you're not just working at a Target, you're not just working with your team, like you're working with teams throughout the organization, hopefully.
Speaker C:And so I think standardizing it makes a lot more sense.
Speaker A:Yeah, I 100, I, I 100 agree with you and I think, I think you said it very well.
Speaker A:Chad.
Speaker A:Chad, what's your take?
Speaker A:Do you have any other light you'd share on this given your personal experience in working with retailers across the industry?
Speaker D:Yeah, I mean, I'd agree with everything David said in terms of the merits and values and what we've observed and experience of, of in person work.
Speaker D:Right.
Speaker D:You know, easier to maintain relationships remotely, harder to build new ones, decisions get made faster.
Speaker D:And quite frankly, psychologically people have feelings of higher collaboration that is less transactional when they're in person.
Speaker D:We're generally social creatures.
Speaker D:I would also imagine in person leads to higher engagement, more connection and loyalty to the job and company, higher satisfaction.
Speaker D:Don't have the data.
Speaker D:But you know, as you guys are debating Starbucks versus Target's model and which is better and you know, kind of the practicality of logistics aside, you know, I, I think what I'd add is like corporate cultures are different and policies need to align with the values and cultural norms of that company.
Speaker A:Right.
Speaker D:They have to balance the productivity with recruitment and retention.
Speaker D:It can't be viewed in a vacuum.
Speaker D:Right.
Speaker D:So how employees are treated and respected and valued in other ways than just office policy.
Speaker A:Right.
Speaker D:So, you know, maybe an illusion of flexibility when corporate culture is way more restrictive.
Speaker D:Right.
Speaker D:Can just be lip service or if you do have a more restricted mandatory policy, but employees do feel valued and respected, it can work and make sense.
Speaker D:So I would just, you know, continue to advise companies to make sure that the policies that they're doing aligns with their overall culture and values.
Speaker A:Yeah, the point I'd add on top of that, and I'm not, I've been thinking about this a lot.
Speaker A:I'm not sure exactly how to articulate.
Speaker A:So you guys will need to give me some space here and maybe even help me out to articulate it.
Speaker A:I think in addition to the culture, there's also the work that is required from the company itself inside of that culture.
Speaker A:And so, you know, I look at Target and the commercial team, that's basically the merchant and the inventory planning teams, the planning and allocation teams.
Speaker A:And you know, I, as I was stepping Back from this story, both for Starbucks and Target, I was like, okay, yeah, if your job is to put products in front of customers in physical spaces, it probably is important for you to work together, to get into the stores together, to understand that, to be in charge of that, to make it work the best way.
Speaker A:Because my guess, and from what I'm hearing from a lot of people, and I've been hearing this for the past two or three years, the remote work has been a big reason why we're seeing all these pictures of targets out of stock shop shelves throughout social media constantly.
Speaker A:And that's because I think these teams are not together working through the issues and not, you know, going down to the store right next door and being like, look, what are we doing about this?
Speaker A:You can't get together to solve that problem in a way that's.
Speaker A:That's easy and efficient.
Speaker A:So I.
Speaker A:That's the.
Speaker A:I.
Speaker A:Sorry for not articulating that as well as I normally would try to do, but I think there's something to that in terms of the work that has to be done as well.
Speaker C:Chris, you bring up a really good point, too.
Speaker C:It's like, how is this being measured too?
Speaker C:Like, I don't know, like, are we.
Speaker C:Is it just simply, like, productivity that's being measured once people are coming back to work?
Speaker C:But, like, are there teams at these, at these, These companies who are really investigating, like, what positives are we seeing from this?
Speaker C:Like, how do we measure the success of our organizations after being able to do that?
Speaker C:Is it just full shelves or, you know, what else are they tracking to make sure that this.
Speaker C:This is the right move, too?
Speaker A:Well, that's a pretty easy measurable metric.
Speaker A:Do we see in stock improvement once we force the teams back in the office?
Speaker A:I mean, that's one.
Speaker A:Can you correlate it directly?
Speaker D:No.
Speaker A:Is it required?
Speaker A:Not necessarily, but it probably doesn't hurt, right?
