Starbucks’ CTO is cutting jobs as part of a company-wide shakeup.
The move comes after the coffee chain’s CEO said algorithms could transform customer experience across its 39,000 shops globally.
He had earlier blasted the lack of sequencing in mobile application orders and promised to restore “humanity” to customer experience.
CTO: More outsourcers
“We are realigning our resource mix of internal and outsourced talent,” according to a memo Starbucks CTO Deb Hall Lefevre sent to staff today.
That comes a day after Starbucks CEO Brian Niccol said layoffs were coming: “We are simplifying our structure, removing layers and duplication and creating smaller, more nimble teams” he vowed.
Starbucks CTO Lefevre’s memo, as first reported by Bloomberg, suggests that Starbucks Technology will face a considerable shakeup across data and analytics, engineering and other functions. It declined to comment on the number of roles being removed or reallocated to external firms.
Some 1,100 staff in total are expected to lose their jobs, as the coffee shop chain’s new CEO tries to turn around a company that has seen sales slump – despite Starbucks spending $600 million on marketing in 2024.
Technology is not the only part of the organisation set for restructuring – and even Starbucks’ menus are not going to be immune to cuts.
"Overly complex menu"
Niccol, who took over as CEO on September 9, 2024, told analysts on his first earnings call: “We will cut down our overly complex menu to align with our core identity as a coffee company.” (No more “Venti 7 pump vanilla soy 12 scoop matcha 180 degree NO FOAM green tea lattes”?)
Starbucks is trying to ensure all customers get their coffee within four minutes of ordering. It has built an extensive mobile ordering system (powered at the backend by AWS) with over 35 million Starbucks application members using it.
"Mobile ordering has no sequencing"
But strikingly, Niccol revealed during a January 28, 2025 earnings call: “The biggest challenge is the fact that the mobile ordering has no sequencing! It’s just first in, first out. All these orders come flooding in… faster than even our customer can get there, so all these drinks are sitting on the counter, and it's at the expense of providing any other experience for a customer that's right in the store…
"We've got a full court press on solving the sequencing.”
Speaking with analysts three weeks ago on the call, Niccol said: “We've already started to put this algorithm in that… smooths out, I would say, those rushes of mobile orders such that our teams are able to provide great moments of connection for the in-cafe customer and the mobile order customer, as well as our drive-through customers…”
“In short, investments in staffing and deployment, processes, and algorithm technology demonstrate the greatest opportunity to deliver a four-minute wait time in most of our cafes… we [have also] reintroduced ceramic mugs and handwritten notes on cups to better connect with customers and elevate the cafe experience for those who choose to stay.”
