The Power of Story

“Our company was losing value, and customers were turning away from us.  We had lost the power of our story.  We started as a brand committed to not only making great coffee but creating a great customer experience in an environment of committed employees.”  Howard Schultz, CEO Starbucks.

Mr. Schultz understood the importance of narrative in turning around his company.  He did not say we had lost the focus on our bottom line profits, or the taste of our coffee, or the style of our stores.  He said they had lost the narrative and it had to be saved or Starbucks was going to crash.  To his credit, he resurrected the story and the stock has followed suit. 

Every individual, company, neighborhood, institution, and nation has a story - a narrative that is being lived out - for good or bad.  Your narrative embodies the myths, conflicts, and emotions of the primary forces that are at work in making your story positive, negative, or just blah. 

For instance, as a country, what is the central narrative that embodies America?  Our core narrative is found in the Declaration of Independence: “We hold these truths to be self-evident, that all men are created equal, that they are endowed by their Creator with certain unalienable Rights.”  And while the Declaration was the tip of the iceberg, our national narrative beneath it’s surface has been shaped over the last two and a half centuries. Great political leaders understand that whoever can craft the most compelling story for the American people is the party who wins the next election.  It’s not about rational arguments supported by lots of data. It’s about capturing the imagination of voters.  Just as it goes for nations, so it goes for companies.  Howard Schultz knew he had lost control of the Starbuck’s narrative and he had to win back the hearts of the customer.    

So let me ask you this: What is the narrative of your company or your non-profit?  What is the story you tell that resonates with purpose, meaning, and connection with your customers, your suppliers, and shareholders?  If it’s a war metaphor - defeat the other guy by being top dog in your industry - your narrative will have little traction with your customers, but will appeal to highly competitive people inside your organization.  If your central narrative is about profit - make the most money possible - your narrative makes you the villain with your customer and you will ultimately lose the  connection with your customer base. 

However, if your narrative is centered around meaning, purpose, and inspiration, you are in a great position to develop deeper loyalty with your followers.  In the beginning, Starbucks redefined coffee from being a simple commodity to also being a connector of people - one cup of coffee in one neighborhood at a time. Starbucks designed their products, services, and architecture around this narrative, down to every detail of their store.  Customers experienced what worked and did not work.  They felt which details were in alignment and which were not. When a detail was not in alignment, they let other’s know about it on Yelp.  When Howard Schultz retired, Starbucks started expanding quickly and lost focus. They tried to put stores everywhere. The stores lost their sense of intimacy and coziness. Baristas were not as well trained. Jay Leno joked that Starbucks was building a store in his closet.  So Mr. Schultz recaptured the narrative.  He now talks about each store as nurturing the human spirit through one cup of coffee, one conversation, one place at a time.  He is not into market saturation, but emphasizes the Starbucks narrative so that market growth comes through valuable customer experience. 

As you lead your company, do not overlook the power of your narrative as it is experienced through the eyes of each of your stakeholders.  Your audience wants to know why you are providing them your product or service and why they should care when they deliver that product or service as an employee or supplier.   A great answer to the  question about your narrative assures the customer, employees, and other stakeholders that you are working for more than just the money.  Your vision is much deeper than just being “a model in your industry”, or being “the largest single provider.” 

Each industry has the potential for it’s own unique narrative. In health care, for instance, a positive narrative can be anchored in a passion for health and healing.  You need to find the narrative that differentiates you from everyone else.  At United Stationers, a multi-billion dollar company which distributes office supplies, the narrative is about service to others - helping all of the stakeholders be successful. Their competitors focus more on “lowest price” - thus missing the fact that they are in the service business and must get close to their customer..

So first, develop a deep understanding of the narrative you are creating to differentiate your brand. Your narrative signals who you are — as an individual, a company, or a nation. Your narrative starts with looking back at the past -  the stories, myths, and anecdotes created by you and your company. It progresses to the present as you create relationship with your customers, suppliers, employees, shareholders, and your community.  It continues with the future - way out there - where you can create what you want  people to say and the story they will tell others. The future narrative is best when it embodies the best elements of what you can deliver in the marketplace.

Here’s a helpful exercise.  Write out, “What is the narrative of our company?” Then write out, “What do we want it to be?”  Ask others who admire you what they say about you.  Don’t worry so much about the dissenters.  Start with the admirers. Once you start to get clarity, then ask how you can take your story and express it in every detail on a daily basis in every element of your business. 

As a community of learners, I’d love to see your comments and ideas.

* If you want to learn more about the power of narrative, I recommend you visit the works of both David Altschul and John Hagel.  Both thought leaders have helped to transform, through the power of narrative, some of the biggest brands in America.