"Innovation is CREATIVITY that ships" (Steve Jobs). Not a PowerPoint slidedeck.


I had my first opportunity to taste Tully’s Coffee in 1999 in a suburb of Seattle. The coffee taste was smooth. The baristas were friendly. The customer experience was positive and satisfactory. At that time I did not know much about Tully’s Coffee Corporation. Although I had tasted the major competitor’s coffee, Tully’s coffee seemed distinctly different with a refreshing taste that seemed to linger.


Fast forward to Sep 2013. I’ve read that Michael Avenatti is the new owner of Tully’s Coffee. Putting myself in the shoes of the new management team, I reflected about the business turnaround plan that will give Tully’s a one-two punch in the eyes of the investors and customers.

Anecdote Time

Green Mountain Roasters Coffee has always believed that “if you sell the brewer, single cup sales will come.” Every barista at Tully’s is hard at work with an intent to deliver great customer service with a shared frame of reference as depicted below.



There is work cut out for a hands-on Activist Turnaround Manager (ATM), with a passion to think bravely, to pitch in and work with Global Baristas to “move the needle” on the following performance measures:

  • Increase Throughput
  • Reduce Inventory
  • Reduce Operating Expenses


Tully’s turnaround plan should follow the five focusing steps of constraints management with (a) productive paranoia, (b) empirical creativity and (c) fanatic discipline. Such an organizational culture is embedded in companies that strive to be great.

  1. Identify the system’s constraint.
  2. Exploit the system’s constraint.
  3. Subordinate everything else to the above decision.
  4. Elevate the system’s constraint.
  5. Go back to step 1; do not yield to inertia (continue the improvement process).

Orchestrating inside the roadmap of the five focusing steps will position Tully’s to achieve its performance objectives and increase its Return on Luck (ROL). Note specifically that return on luck is not the same as luck.


Tully’s proposed turnaround may be positioned as both a marketing campaign and an entertainment campaign. This will make the endeavor both social and fun. After all we all want to work hard and enjoy life as well (with a cup of coffee of course). From a strategic standpoint, Tully’s should also recognize the opportunity for value co-creation with the revenue-paying customer and building enduring relationships.

Send Off

America’s appetite for entrepreneurial capitalism needs a much needed “caffeine boost” across all zip codes (not just cherry picked ones). If the corporate renewal of Tully’s is successful, it can become a salient case study to rally around. The distressed businesses on Main Street can obtain key action-oriented insights.

Note: It is not enough just writing this blog posting. It is time to board the Turnaround bus. I like to walk the talk. Perhaps there are door openers to realize my dream?

Author: Last Mile Resource

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