By refocusing on the company’s core principles that had originally made the premium brand successful, Shultz was able to help customers and employees fall back in love with Starbucks, leading its share price to more than triple during his second tenure.
#Boomerang menu series
Pursuing rapid growth, his successors had made a series of changes - such as introducing automatic espresso machines and more “sterile” store designs - that degraded the higher-touch, higher-class Starbucks experience. For example, Howard Schultz returned to Starbucks after an eight-year hiatus, when the company’s stock price was suffering. Several of the best-known examples of boomerang CEOs have been highly successful. For ex-chiefs intimately familiar with the business, however, much of this learning period may be reduced or even eliminated. Even for an experienced executive, it takes time to gain the knowledge and skills that are specific to the CEO position in a particular company. Most new chief executives must go through an initial learning period, becoming familiar with all the operational nuances of the new company. One of the best arguments for bringing back former CEOs is that they are a known quantity, an attribute often important to employees and investors looking for reassurance that a company can get back on track.Ĭompanies also elect to bring back boomerang CEOs when they want a leader who can hit the ground running. The Possible UpsideĬompanies sometimes turn to former CEOs in times of crisis - which usually means that their successors have gotten into trouble and either resigned or been fired abruptly.
This comparative investigation revealed some nonobvious insights and critical implications for leaders of large and small organizations. We then compared their tenures with those of more than 6,000 other (non-boomerang) CEOs over the same period. To better understand the consequences of bringing back a former CEO, we collected and analyzed data on the performance of 167 boomerang CEOs of companies listed on the S&P Composite 1500 index from 1992 to 2017. But while boomerang CEOs appear to be prevalent, little was known until now about the implications of this practice.Įvidence-based resources that can help you lead your team more effectively, delivered to your inbox monthly.
Penney, Reddit, Bloomberg, Urban Outfitters, and Charles Schwab, among others, all had former CEOs return to lead their organizations. Dell, Enron, Google, Twitter, Snapchat, Best Buy, Starbucks, Yahoo, DuPont, Procter & Gamble, J.C. Jobs is certainly a unique case - yet, surprisingly, many other large and high-profile companies have turned to former CEOs, often called boomerang CEOs, in times of need. Through a series of brilliant changes and innovations, Jobs helped refocus and rebuild Apple, which ultimately became one of the largest and most powerful companies in the world. As it neared collapse in 1996, Jobs returned to retake the reins of the company he had created. Apple struggled over the next decade, losing much of its market share and dominance in the personal computer industry. In the spring of 1985, the board of Apple Computer made the fateful decision to force out cofounder Steve Jobs.
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