AND THIS IS RANDY CARLSON,
AND WE ARE HERE TO TALK ABOUT IOT.
BUT WE ARE NOT GONNA TALK ABOUT THE NORMAL TEXT STUFF,
RIGHT, THAT YOU ARE COMING HERE FOR.
WE'RE NOT GONNA TALK ABOUT THE SOFTWARE OR THE HARDWARE
OR WHAT ARE THE TECH
THAT WE NORMALLY TALK ABOUT HERE (MUMBLES).
WE'RE GONNA TALK ABOUT.
(LAUGHING)
CHECK ONE, TWO, CHECK, CHECK.
OKAY, WE ARE GONNA TALK ABOUT
WHAT DOES IT TAKE TO ROLL OUT IOT IN A BIG CORPORATION
AND WHAT OUR EXPERIENCE HAS BEEN
FOR THE LAST YEAR AND A HALF, RIGHT?
MAKING A SOFTWARE WORK AND MAKING THE HARDWARE WORK
IS THE EASIER TASK, EASIER PART OF THE WHOLE EQUATION.
BECAUSE WE HAVE GOT FABULOUS GUYS LIKE RANDY
WHO WORK IN STARBUCKS TECHNOLOGY.
I AM THE OTHER END OF THE EQUATION.
YOU KNOW WHEN YOU SAYING, INTERNET OF THINGS,
HE'S THE INTERNET AND I AM THE THING, OKAY?
(RANDY LAUGHING)
SO MY GROUP PUTS ALL THIS EQUIPMENT IN THE STORES
THAT DELIVERS THE FOOD OR BEVERAGE.
OKAY, STARTING OFF WITH THE FIRST SLIDE.
SO WHY IS IOT IMPORTANT?
THE FIRST PROOF OF WHY IOT IS IMPORTANT IS,
YOU KNOW, YOU CAN SEE IT FOR YOURSELF.
GO GRAB A CUP OF COFFEE THAT IS BEING SERVED HERE
AND THEN WALK OVER TO THE IOT BOOTH TO THE STARBUCKS BOOTH.
THERE IS A MACHINE THERE WHICH SERVES COFFEE.
TRY THE COFFEE HERE AND COFFEE THERE,
AND YOU'LL SEE THE DIFFERENCE.
OKAY.
AND THE REASON IS THE MACHINE THERE IN THE BOOTH
IS ACTUALLY CONNECTED TO OUR SERVERS.
IT HAS THE LATEST RECIPES, AND YOU'LL SEE HOW MUCH
DIFFERENCE RECIPE MAKES IN THE TASTE OF COFFEE, RIGHT?
AND THAT IS WHAT IOT IS ABOUT,
IT IS ABOUT GIVING YOU THE BEST FOOD OR BEVERAGE
WHEN YOU WALK INTO A STARBUCKS EVERY MORNING
WITHOUT PUSHING IN A LOT OF TECH
TO OUR PARTNERS IN THE STORE
WHO ARE VERY FOCUSED ON SERVING YOU
AND GIVING YOU THE BEST FOOD OR BEVERAGE EXPERIENCE.
NOW COMING TO THE NUMBERS, RIGHT.
THE FIRST THING IS THAT WE HAVE A LOT OF STORES.
OKAY.
AND WE HAVE A LOT OF EQUIPMENT IN THE STORES.
AND I'LL COVER HOW MANY STORES,
HOW MANY PIECES OF EQUIPMENT
IN THE STORE IN THE NEXT SLIDE.
WHAT HAPPENS IS THAT EVERY TIME THERE IS A PROBLEM
WITH ONE OTHER PIECE OF EQUIPMENT
WHERE THEY CAN'T SERVE THE CUSTOMER.
THE BARISTA IN THE STORE OR A PARTNER IN THE STORE
PICKS UP A PHONE AND CALLS A 1-800 NUMBER.
AND THE CALL OF 1-800 NUMBER, WE ROLL A TRUCK, OKAY.
AND WHAT WE HAVE FOUND IS THAT ABOUT 10 TO 15%
OF TRUCK ROLLS HAVE NO PROBLEM AT ALL WITH THE MACHINE.
SO JUST THINK.
I'LL DO A SIMPLE MATH ON THE NEXT SLIDE.
LOT OF STORES, LOT OF MACHINES.
AND IF 15% OF THE CALLS HAVE NO PROBLEM,
THEN WE SHOULDN'T ROLL A TRUCK.
SO THE FIRST BUSINESS CASE OF IOT IS
I DON'T HAVE TO ROLL A TRUCK.
SECOND IS COMING BACK TO THE CASE I TOLD YOU,
ONE, WHEN YOU GO TASTE THAT COFFEE OUT THERE,
YOU REALIZE THAT RECIPES ARE VERY IMPORTANT.
AND WE BASE OUR FOOD AND BEVERAGES
BASED ON AGRICULTURAL PRODUCTS, RIGHT.
SO EVERY YEAR THE CROP IS DIFFERENT,
THE BLEND THAT WE DO FOR COFFEE IS A LITTLE DIFFERENT,
WHICH MEANS WE HAVE TO SEND OUR RECIPES
TO ALL OUR MACHINES AND ALL OUR STORES.
COFFEE RECIPES, SANDWICH RECIPES,
EVEN OUR BLENDERS, RIGHT.
YOU SEE OUR BLENDERS IN OUR STORES?
THEY ALL HAVE SPECIFIC PROGRAMS.
FOR EVERY FRAPPUCCINO YOU ORDER,
THERE'S A DIFFERENT RECIPE ON THE BLENDER.
SO EVERY YEAR, WE ARE SENDING OUT THESE RECIPES
TO ALL OUR STORES, RIGHT.
AND WHEN YOU LOOK AT THE SCALE AT WHICH WE ARE
AND THE MACHINE THAT WE HIRE,
THAT IS WHERE IOT MAKES A BIG, BIG, BIG, BIG, BIG IMPACT.
RANDY, DATA ANALYTICS.
YEAH, WE CAN TALK ABOUT DATA ANALYTICS.
SO, PART OF WHAT VENKAT'S TALKING ABOUT IS,
YOU KNOW, THE REAL-TIME EXPERIENCE IN THE STORE,
BUT THERE'S ALSO A LOT OF DATA THAT WE GATHER
FOR LONGER-TERM ANALYTICS.
SO WE CAN DO THE PREVENTATIVE MAINTENANCE SIDE OF THE HOUSE.
WE CAN TAKE A LOOK AT, YOU KNOW, HARPY TRENDS
TO MAKE SURE THAT WE'RE STILL GETTING CONNECTED
ACROSS ALL OF OUR STORES AT ALL TIMES.
WE CAN TAKE A LOOK AT GEOGRAPHY AND TAKE A LOOK AT WHETHER
CERTAIN GEOGRAPHIES ARE HAVING PROBLEMS
OR CERTAIN GEOGRAPHIES ARE GETTING DIFFERENT DATA.
AND IT OVERALL, IT JUST GIVES US THE ABILITY
TO DO LONGER-TERM ANALYTICS, SEASONAL ANALYTICS
AND CAPTURE ALL THAT DATA
AND DO SOMETHING INTERESTING WITH IT.
SOMETHING FOR YOU TO CARRY AWAY
FROM THIS SESSION.
THIS IS THE FIRST PROJECT WHERE WE DID,
WHERE WE ROLLED OUT THE STARBUCKS,
YOU KNOW, WHERE THE EQUIPMENT ENGINEERING TEAM THAT I HAD,
AND THE STARBUCKS TECHNOLOGY TEAM DID,
WHERE WE REALLY DIDN'T DO A LOT OF FINANCIAL ANALYSIS.
WE DIDN'T GO TO THESE FINANCE PEOPLE
AND SAY WHETHER IT MAKES SENSE OR NOT,
BECAUSE WHAT WE FIGURED IS THE TOTAL COST OF ROLLING OUT IOT
ON A SINGLE MACHINE,
IF WE SAVE A SINGLE CALL DURING THE LIFE OF THE MACHINE
AND OUR AVERAGE LIFE OF THE MACHINE IS
ABOUT SEVEN TO EIGHT YEARS,
THAT IS HOW LONG THE EQUIPMENT IS.
IF WE SAVE ONE CALL, ONE TRACK LOAD, ONE TRACK ROLL,
IT PAYS BACK FOR THE ENTIRE COST OF IOT DEPLOYMENT
OVER THE SEVEN TO EIGHT YEARS LIFE OF THE MACHINES.
THAT IS THE MAIN REASON WHY WE ARE DOING IOT.
BECAUSE THE BENEFITS ARE TOO MANY,
THE COST IS INSIGNIFICANT, BUT THE KEY IS, HOW DO YOU DO IT?
GO TO THE NEXT SLIDE.
OH, WE GOT TWO MORE THINGS HERE TO TALK ABOUT.
THEY'RE JUST NOT THERE.
THEY'RE IN WHITE. (VENKAT LAUGHING)
THAT'S TRANSPARENT TO YOU.
SO, ONE OF THE OTHER THINGS TO SAY IS
THE CUSTOMER EXPERIENCE.
STARBUCKS IS ALL ABOUT THE CUSTOMER EXPERIENCE
WELL, ABOUT SPENDING THE TIME TO MAKE EACH
INTERACTION A PERSONALIZED INTERACTION WITH OUR CUSTOMERS.
AND THE ABILITY TO ACTUALLY KNOW WHAT'S GOING ON
WITH OUR MACHINES AND BE ABLE TO REACTIVELY
AND, IN A LOT OF CASES, PROACTIVELY KNOW
WHEN WE'VE GOT PROBLEMS,
ALLOWS US TO ACTUALLY DO SOMETHING
BEFORE IT IMPACTS THE STORE.
SO BEFORE CONNECTED WORLD OF A STRAIN THAT MIGHT DIE,
AND WE WOULDN'T KNOW IT UNLESS THE PARTNERS CALLED UP.
BUT THEY'RE BUSY TRYING TO DO CUSTOMER INTERACTIONS.
NOW WE CAN ACTUALLY GET IN THERE.
NOTE THAT THERE'S GONNA BE A PROBLEM.
GET SOMEBODY SENT OUT, AND WE CAN,
YOU KNOW, CREATE MORE CUSTOMER EXPERIENCES THAT WAY.
THERE THEY ARE.
OKAY.
YEAH.
SORRY, TECHNICAL DIFFICULTIES HERE.
OKAY, SO NOW THE SLIDE IS TURNING OUT OKAY.
NOW, SO WHEN MICROSOFT ANNOUNCED AZURE,
THE AZURE SPHERE.
IT WAS SOME TIME IN MARCH LAST YEAR.
OKAY, THE FIRST DEVELOPMENT BOARD WAS AVAILABLE
IN AUGUST, OKAY.
THE DAY THAT BOARD WAS AVAILABLE,
WE WERE THE FIRST GUYS TO GET IT.
AND I'LL TELL YOU THE REASON WHY
WE WERE THE FIRST GUYS TO GET IT,
BECAUSE IT MADE A LOT OF SENSE FOR US.
WHY DOES IT MAKE SENSE?
IF YOU LOOK AT THIS CHART, RIGHT.
SO THINK ABOUT IT.
STARBUCKS 30,000 STORES WORLDWIDE, OKAY.
WE ARE IN 85 COUNTRIES, OKAY.
THERE ARE ABOUT 15 PIECES OF EQUIPMENT IN EACH STORE.
WHEN YOU WALK INTO A STARBUCKS, ORDER A FOOD OR BEVERAGE,
YOU'RE TOUCHING ONE OF THESE 15 PIECES OF EQUIPMENT.
PLUS WE ARE DEPLOYING ABOUT 15 TO 20 SENSORS IN EACH STORE
FOR DIFFERENT THINGS, RIGHT.
WE HAVE TO WORK WITH WORK AND INTEGRATE 200 PLUS SUPPLIERS.
SO, ONE SIDE IS THE INTERNET.
THE OTHER SIDE IS A THING.
THERE ARE 200 MORE THINGS
THAT WE HAVE TO CONNECT TO THE INTERNET.
AND EACH STORE
COMES WITH A UNIQUE NETWORKING CHARACTERISTICS.
BECAUSE IF YOU LOOK AT IT,
WE HAVE 500 PLUS RELATIONSHIPS, RIGHT.
YOU SEE A STARBUCKS IN A TARGET.
YOU SEE A STAR STARBUCKS IN THE AIRPORT.
YOU SEE A STARBUCKS IN KOREA.
YOU GO TO PERU, YOU SEE A STARBUCKS.
ALL THE STARBUCKS SERVE THE SAME FOOD OR BEVERAGES
THAT COME UNDER THE SAME BRAND,
BUT WE HAVE DIFFERENT BUSINESS RELATIONSHIPS
TO ENABLE THOSE STARBUCKS.
WHEN THERE IS A DIFFERENT BUSINESS RELATIONSHIP,
THAT MEANS WE ARE DEALING WITH ANOTHER IT ORGANIZATION.
THERE IS A DIFFERENT WI-FI NETWORK
THAT RANDY HAS TO DEAL WITH.
THERE IS A SEPARATE SECURITY AUDIT
THAT RANDY HAS TO DEAL WITH.
AND SO THAT IS WHERE THE COMPLEXITY STARTS.
SO IT'S MUCH BEYOND TAKING THE SPHERE DEV KIT,
MAKING IT WORK, CONNECTING IT TO A MACHINE,
SENDING THE DATA.
THAT IS JUST 1%,
AND THAT WE GOT DONE WITHIN A WEEK
OF THE GEOSPHERE GETTING ROLLED OUT.
THE MOMENT WE GOT A DEV KIT WITHIN A WEEK,
WE WERE WE HAD THAT RUNNING.
AND WE ARE STILL HERE, WE ARE STILL DEPLOYING.
AS OF TODAY, WE ARE GOING TO START DEPLOYING.
WE HAVE CONNECTED MY STRAINER TO AND ROUGHLY
ABOUT 50 TO 60 STORES.
AND WE'RE GOING TO DEPLOY THROUGHOUT THE YEAR.
YEAH THE EASY PART IS THE FIRST ONE.
IT'S THE TEN THOUSANDTH ONE, THE THIRTY THOUSANDTH ONE.
WHEN YOU TALK ABOUT THE NETWORKING CHARACTERISTICS,
WE HAVE STORES THAT HAVE ONLY MOBILE BACKHAUL.
WE HAVE STORES THAT CAN'T GET MOBILE SERVICE.
SO, WHEN YOU WHEN YOU LOOK AT HOW YOU ROLL THIS OUT,
IT'S COMPLEX
IT'S HARD, BECAUSE EVERY STORE IS UNIQUE.
EVERY ENVIRONMENT'S UNIQUE, EVERY GEOGRAPHY'S UNIQUE.
WE'VE GOT DIFFERENT VENDORS, SUPPORTING OUR ENVIRONMENTS
ACROSS THE WORLD, AND THAT MAKES IT HARD.
THAT'S NOT AN EASY PROBLEM.
OKAY, SO WE PUT TOGETHER
THESE DESIGN PRINCIPLES FOR ROLLING OUT IOT.
IT SERVED US VERY WELL, RIGHT.
AND THIS IS PARTLY, WE HAD ABOUT,
THERE ARE ABOUT 12 ON THE SHEET.
AND WE WILL TALK TO EACH ONE OF THESE.
WHEN WE STARTED, WE HAD ABOUT FIVE.
AND GUESS WHAT HAPPENS?
EVERY TIME HE HAD A PROBLEM, HE ADDED ONE MORE.
AND WE ARE AT 12.
WE ARE DEPLOYING.
HOPEFULLY, WE WON'T HAVE ONE MORE, OKAY.
SO, FIRST ONE IS ADAPTABILITY.
SEVERAL THINGS TO CONSIDER UNDER ADAPTABILITY.
FIRST ONE IS YOU ARE CONNECTING
THIS COMPLEX SYSTEM
TO PIECES OF EQUIPMENT THAT ARE COMMODITIZED.
I AM CONNECTING THIS TO BLENDERS, REFRIGERATORS,
TO COFFEE MACHINES,
AND SOME OF THESE MACHINES HAVE BEEN THERE IN OUR STORES
FOR THE LAST SEVEN YEARS, OKAY.
GUESS WHAT MICROPROCESSOR IS IN OUR BLENDER?
EIGHT YEARS OLD.
IT'S PROBABLY 8-BIT MICROPROCESSOR, RIGHT.
I HAD INTERFACE WITH THE EIGHT-PIECE MICROPROCESSOR,
AND THE FIRST EQUIPMENT WITH THE OPERATING SYSTEM
THAT WE ARE DEPLOYING IS THIS YEAR.
SO EVERYTHING PASSED WAS WHAT YOU GUYS CONSIDER
OR GUYS AND GALS CONSIDERED A PRIMITIVE DEVICE.
AND THAT IS VERY IMPORTANT FOR US.
YEAH, WHEN YOU TALK ABOUT THE TECHNOLOGIES TOO
AND THE TYPE OF PROTOCOLS BEING USED,
IF YOU LOOK AT THE IOT LANDSCAPE,
THERE ARE A DOZEN DIFFERENT NETWORKING PROTOCOLS
THAT ARE BEING USED, FROM ZIGBEE TO WI-FI TO BLUETOOTH ETC.
AND PART OF WHAT WE'RE TRYING TO DO
IS MAKE SURE THAT WE HAVE AN OPEN PLATFORM.
SO SOMETHING WE CAN DEVELOP AGAIN,
SOMETHING WE CAN GIVE TO OUR VENDORS,
OUR EQUIPMENT MANUFACTURERS, OUR INSTALLERS.
ANYBODY THAT'S THAT'S IN THIS SPACE,
WE WANT TO TRY TO LEVERAGE ENOUGH OPEN TECHNOLOGY
TO BE TO BE ABLE TO INTEGRATE THIS SUCCESSFULLY
AND KEEP OURSELVES OUT OF THAT VENDOR LOCK SOLUTION
WHERE WE CAN'T PLUG IN SOMEBODY'S LATEST INTERNET,
YOU KNOW, CONNECTED DEVICE INTO OUR STORES,
BECAUSE THEY DON'T PLAY WELL WITH OTHERS.
THE SECOND, THE THIRD MOST IMPORTANT CRITERIA
WE HAD WAS WE DIDN'T WANT ANYONE IN THE STORE.
SO THINK ABOUT IOT.
WE WANT IT TO BE REAL PLUG-AND-PLAY.
BECAUSE HERE IS HOW OUR SYSTEM WORKS, RIGHT.
YOU PLUG IN A MODULE, IT HAS TO TALK TO OUR MACHINE.
THEN IT HAS TO GET ON TO OUR WI-FI NETWORK IN THE STORE,
COME ALL THE WAY TO A SERVICE HERE, RIGHT.
AND THEN THE WHOLE THING HAS TO WORK LIKE A CHARM.
SO IF YOU SEE THERE ARE FOUR LIGHTS ON OUR MODULE
THAT YOU SEE IN OUR STORE,
AND ALL THE FOUR LIGHTS HAVE TO LIGHT UP.
AND WE HAVE 350,000 PARTNERS.
WE DON'T WANT TO TRAIN 350,000 PARTNERS
ON NETWORKING AND HOW IT CONNECTS TO THE INTERNET,
BECAUSE THEY ARE VERY BUSY SERVING THEIR CUSTOMERS, RIGHT.
THEIR JOB IS TO SERVE THEIR CUSTOMERS
AND GIVE THEM THE MOST AWESOME EXPERIENCE THERE IS, RIGHT.
SO WE DESIGNED A SYSTEM END-TO-END,
SO THAT YOU TAKE A MODULE, YOU PLUG IT INTO THE MACHINE.
IT WILL BOOT UP, IT'LL SEND DATA, IT WILL GET RECIPES.
AND IF YOU DON'T SEE THE THREE LIGHTS ON,
SOMEBODY WILL CALL YOU WHEN THE THREE LIGHTS ARE NOT ON.
AND IF THE MODULE IS BROKEN,
WE CAN TAKE IT AND SEND IT TO RECYCLING
AND PLUG A NEXT MODULE IN,
AND HERE WE GO, RIGHT.
AND AS OF TODAY,
THE SPHERE AND AS YOUR SYSTEM
IS THE ONLY SYSTEM THAT PROVIDES US
THAT AMOUNT OF INTEROPERABILITY.
YEAH, ALSO TALK ABOUT,
YOU KNOW, AS TECHNOLOGY CHANGES AGAIN IN THE SPACE,
THERE'S RAPID EVOLUTION ON THE TYPE OF TECHNOLOGIES AND ALL.
WE'RE TRYING TO MAKE SURE THAT WE'RE ADAPTABLE TO THOSE.
SO, NOT DECIDING ON TECHNOLOGY SUITES
THAT ARE GONNA LOCK US IN TO A PARTICULAR VENDOR
OR A PARTICULAR, YOU KNOW, TECHNOLOGY GOES OUT OF SPACE.
THAT'S SOMETHING WE'VE WORKED A LOT WITH MICROSOFT ON
AS FAR AS THE SECURITY SIDE.
WHAT WE'RE TRYING TO DO,
BECAUSE WE WANT THIS THING TO SCALE TO,
YOU KNOW, THIRTY THOUSAND STORES.
WE WANT THIS TO BE ABLE TO RUN IN MULTIPLE GEOGRAPHIES.
AND IT'S GOT TO BE SOMETHING THAT'S MAINTAINABLE
AND OPERABLE FOR US,
FOR HOWEVER LONG THE EQUIPMENT STAYS AROUND,
WHICH IS TYPICALLY NOT A YEAR OR TWO, RIGHT.
IT'S SEVEN OR EIGHT, NINE, TEN YEARS
THAT WE RUN SOME OF THIS EQUIPMENT.
WE HAVE TO HAVE SOMETHING THAT MADE GAINS ACROSS THAT.
SECURITY?
SECURITY, YEAH
SECURITY'S KIND OF A BIG THING, RIGHT?
THAT WAS ONE OF THE ONE OF THE THINGS
ABOUT THE MICROSOFT SPHERE THAT WAS SO INTERESTING TO US,
IS THEY HAD DEVELOPED THAT SECURITY MODEL FROM THE OS,
FROM THE HARDWARE DOWN, THROUGH THE STACK,
AND THAT ENABLES US TO HAVE MUCH GREATER CONFIDENCE
THAT WHEN WE DEPLOY THESE,
WE'RE NOT OPENING UP 10 TIMES 30,000 STORE ENDPOINTS,
THAT SOMEBODY COULD USE IN SOME MALICIOUS FASHION.
SO THE SECURITY MODEL THAT MICROSOFT HAS IN THEIR SPHERE
IS VERY POWERFUL TO US.
AND THAT'S MADE OUR SECURITY TEAM VERY HAPPY,
AND IT MAKES MY JOB A LITTLE BIT EASIER.
AND SO WHILE WE'RE LOOKING AT THIS,
THEN THAT ALLOWS US THEN
TO TAKE A LOOK AT THE SECURITY PROTOCOLS
UP AND DOWN THE SACK.
AND IT'S, AGAIN, IT'S SUPER IMPORTANT.
THIS DATA IS IMPORTANT TO US.
THOSE ENDPOINTS ARE IMPORTANT TO US TO MAKE SURE
THAT WE ENABLE SECURITY TO RUN EFFECTIVELY
ACROSS THE UNIVERSE.
RELIABILITY.
WE WORK ABOUT TWELVE HOURS A DAY,
AND WE ARE,
COFFEE EQUIPMENT IS PRODUCING LOT OF BEVERAGES IN A DAY.
OVENS ARE HEATING A LOT OF SANDWICHES.
WE CAN'T HAVE OUR MODULE
OR ANY OF A CONNECTIVITY FAIL, RIGHT.
PLUS, A STORE ENVIRONMENT IS A VERY VERY RUGGED ENVIRONMENT.
ALTHOUGH YOU LOOK AT A GREAT EXPERIENCE
IN THE FRONT OF A BAR.
WHEN YOU'RE SITTING IN THE CAFE, IT IS GREAT.
IN THE BACK, IT IS A PRODUCTION ENGINE, RIGHT.
YOUR COFFEE GROUNDS, YOUR WATER, YOUR HUMIDITY,
YOUR, ALL KINDS OF THINGS.
PLUS, WE HAVE OPERATORS.
WE HAVE PARTNERS
WHO COME WITH A VARIETY OF SKILL SETS, RIGHT?
SO ONE OF THE THINGS WE TESTED OUT
IS WE TESTED OUT FOR HOW RUGGED IT IS, HOW RELIABLE IT IS.
DOES A CONNECTION STAY UP?
DOES IT GIVE US GOOD DATA?
CAN IT, YOU KNOW, CAN IT WITHSTAND A WATER SPLASH?
AND ALL THESE ARE VERY IMPORTANT FOR US, RIGHT.
BECAUSE THEY ARE DEPLOYING IT THAT THE LOT OF COST.
THE BIGGEST THING THAT STARBUCKS LOOKS AT
IS SCALABILITY, OKAY.
AND WHY SCALABILITY IS IMPORTANT FOR STARBUCKS
IS WHEN WE SCALE UP AND WE ENABLE IOT
OR WE DEPLOY A MACHINE,
WE DON'T DO IT COUNTRY BY COUNTRY OR AREA BY AREA.
WHEN WE DEPLOYED THE ESPRESSO MACHINE THAT IS IN OUR BOOTH,
WHEN WE SAY WE ARE DEPLOYING ESPRESSO MACHINES,
WE ARE DEPLOYING IT IN KENT, WASHINGTON.
WE ARE DEPLOYING IT IN SEOUL, SOUTH KOREA.
WE ARE DEPLOYING IT IN TOKYO.
WE ARE ALSO DEPLOYING IT IN PERU.
OKAY.
SO, ONCE WE SEE A TECHNOLOGY IS READY TO ROLL OUT,
OUR OPERATIONS TEAM IS DEPLOYING ALL OVER THE WORLD.
SO AT THAT AT THIS INSTANT WE HAVE TO BE READY
TO ENABLE IOT CONNECTIVITY IN ALL THESE COUNTRIES, RIGHT?
85 COUNTRIES YOU AND ALL THE 30.000 STORES, RIGHT.
WE CAN'T SAY THAT WE ARE NOT READY YET FOR CHINA,
BECAUSE THE PORT IS DIFFERENT.
WE HAVE TO BE READY FOR CHINA TOO,
KOREA TOO, RIGHT.
THE OTHER THING THAT IS IMPORTANT
IS WE ALSO HAVE TO PROVIDE A SIMPLE INTERFACE,
BECAUSE WE ARE DEALING WITH 200 SUPPLIERS
A RANGE OF TECHNOLOGIES.
THE OTHER BIG CONSTRAINT WE HAVE IS
TECHNOLOGY ON AN OVERALL SCALE,
ITS LIFE CYCLE IS ABOUT TWO TO THREE YEARS,
WHEREAS OUR EQUIPMENT LIFE CYCLE IS SEVEN TO 10 YEARS.
WE HAVE TO MATCH UP BOTH, RIGHT?
AND SO WE HAVE TO DEAL WITH AN ENTIRE SPECTRUM OF SUPPLIERS.
AND WE HAVE COME UP WITH THE SYSTEM
IN PARTNERSHIP WITH MICROSOFT
SO THAT WE CAN HAVE A UNIQUE, A VERY SIMPLE INTERFACE
THAT IS PUT AS PART OF A PURCHASE ORDER
WITH EVERY PIECE OF EQUIPMENT THAT GOES OUT
SO THAT SUPPLIERS CAN EASILY UNDERSTAND
AND CONNECT WITH OUR IOT PLATFORM.
YEAH, THEN LASTLY,
I THINK THIS IS A LOW COST OF OWNERSHIP.
WE LOOK AT OPERATIONALIZATION OF OF AN ENDEAVOR
THAT STARBUCKS HAS.
IF WE ADD 10 NEW DEVICES AND THAT COST US 10X
TO OPERATIONALLY MAINTAIN THAT,
BOTH FROM A DATA PERSPECTIVE AND EVERYTHING ELSE.
THAT OBVIOUSLY DOESN'T SCALE OUT FROM A BUSINESS STANDPOINT.
AND SO EVERYTHING WE'VE TRIED TO DO FROM DATA ACQUISITION,
DATA GATHERING, DATA STORAGE, ANALYTICS
HAS ALL BEEN AROUND,
YOU KNOW, TRYING TO MAKE SURE THAT WE HAVE THAT LOW COST
ASSOCIATED TO THAT,
WHETHER IT'S IOT THROUGH OUR SUPPLY CHAIN,
IOT THROUGH THE RETAIL STORES,
IOT THROUGH A ROASTING PLANTS.
WE'VE GOT EFFORTS IN ALL OF THOSE
AND SO MAKING SURE THAT WE MAINTAIN
THAT OPERA OPERATIONAL COST AT A LOW FACTOR
IS REALLY IMPORTANT TO US.
SO, THAT IS MY LAST SLIDE.
SO, WHAT I SUGGEST YOU DO IS
GO TRY THE COFFEE IN OUR BOOTH.
TASTE THE COFFEE HERE, TRY THE COFFEE IN A BOOTH,
AND STARBUCKS TECHNOLOGY PARTNERS
AND OUR ENGINEERING PARTNERS WILL BE THERE
THROUGHOUT THE NEXT TWO DAYS.
YOU CAN ASK A LOT OF QUESTIONS,
AND MOST OF THEM HAVE BEEN INVOLVED
IN THE DEPLOYMENT OF THIS, OF THE IOT PLATFORM.
SO THEY CAN ANSWER A LOT OF ON-THE-GROUND QUESTIONS.
THANK YOU.
(CROWD CLAPPING)