Менеджерская стратегия Старбакс
Célia Vernot
Inna Bulycheva
VISION
MISSION
STRATEGY
Vision, mission, strategy
Management key concept. Organizations
In 1971 the story began, three Seattle entrepreneurs started the Starbucks Corporation. They sold whole bean coffee in one store. After 11 years, their business had grown tremendously and they hired Schultz in 1982 to be the manager of retail and marketing. He had some ideas, he 'advised that the company should sell coffee and espresso drinks as well as beans' but he was turned down. He decided to open his own coffee bar in 1986 and a year later because of his great success he bought Starbucks from the original owners. Starbucks is the largest coffeehouse company in the world with 16,120 stores in 49 countries, including around 11,000 in the United States, followed by nearly 1,000 in Canada and more than 800 in Japan. A company needs to have a mission statement that has to be followed by all the employees and goals to achieve, to challenge itself every day. The CEO and the board of directors wanted a mission statement to give a strong sense of organizational purpose.
Moreover Starbucks had set some standards and organize regularly audits controls internal and external.
There are two ways to look at the Starbucks success:
- Functional: People are addicted to caffeine, and Starbucks is the most caffeinated coffee on the market. “People needed to serve their addiction; Starbucks won’t work if it wasn’t an addictive product”
– Emotional: You feel better about yourself when you go to Starbucks. It is a form of self-gifting. People are desperate for belonging. Starbucks offers the community and the feeling to belong to a community. The space, the chair and the longue helps people to be connected.
The goal of Starbucks was to increase brand equity and create a brand identity in consumer’s mind that is: Coffee = Starbucks. With this consumer brand identity, Starbucks believed it would be able to remain the leader.
Environment
Strengths
- Starbucks owns the most recognizable brand in the specialty coffee business, and the Starbucks experience is an irreplaceable differentiating factor.
- Howard Shultz, founder and chairman of Starbucks is the barista to the world. Shultz has practically invented specialized coffee as a mass product, his leadership and innovative vision are very valuable assets.
- The company has a loyal customer base willing to pay premium prices for Starbucks products.
- Store location is an important competitive factor, and Starbucks has secured its presence in many of the most desirable corners of the planet.
- Starbucks is ahead of most competitors when it comes to financial strength and profitability.
Weaknesses
- Starbucks products are more expensive than those offered by the competition, and customers could easily switch to lower priced alternatives in times of economic hardship.
- Aggressive expansion can be risky, as it can lead to cannibalization and a watered down Starbucks experience.
- Health implications of coffee consumption are a matter of debate, and many of the company´s products have high calories and fat content.
Opportunities
- International expansion is still in its first stages, there is plenty of room for growth in emerging markets.
- Revamped food offerings, juice, energy drinks and even potentially some alcoholic drinks are smart ways to leverage the brand and attract different kinds of customers. The acquisitions of Evolution Fresh and La Boulangerie fit quite well into this strategy.
- The company has taken a two sided approach to the home brewing boom popularized by Green Mountain Coffee Roasters (NASDAQ: GMCR). On one hand it produces K-Cup coffee and tea packs for use in Green Mountain´s Keurig, but at the same time Starbucks is competing with its own premium brewing machine, Verisimo.
- Introducing new products and different distribution venues is a strategy which Starbucks is implementing successfully, and it still offers many opportunities in the US and abroad.
Threats
- McDonald´s (NYSE: MCD) is successfully expanding its Mc Café stores on a global scale. The fast food giant has an unparalleled geographical presence and lower prices than Starbucks in addition to a globally recognized brand.
- Dunkin' Brands (NASDAQ: DNKN) makes 60% system wide sales from coffee and other beverages, and the company is expanding beyond its core northeastern U.S. market. Dunkin Brands is another relevant competitor with lower prices than Starbucks.
- High end competition is increasing too, with companies like Panera (NASDAQ: PNRA) growing strongly both on a total sales and comparable store sales basis. Panera offers high quality food and coffees for premium prices, and in that sense it goes after a similar customer group.
- Starbucks is exposed to commodity price fluctuations and possible supply problems in coffee and other products.
- Lots of replacement products, Business administration is easy to be imitated by other coffee shops
Planning
Planning
Planning is an essential function in the success of any business. Planning does not refer simply to pulling out a calendar and recording things to do on random dates. Planning is all about actively plotting a course to meeting goals. Goals are really the start of any discussion about planning in a business.
However, a necessary caveat to specific goals is making sure the goal is measurable. So, using the same example again, 'sell children's books' becomes 'sell $24,000 of children's books in the first quarter.' By now we have a goal that is specific enough that we can then break it down into even smaller measurements and know whether or not we are actually getting somewhere with it.
- Short time
The first objective for the brand is to brew a stronger profit in 2013. Starbucks Corp. plans to accelerate growth and brew up a stronger profit in the year ahead, with CEO Howard Schultz noting that customers of all walks of life consider its drinks an "affordable luxury" even in challenging economic times.
Citing the strength of its core business and a pipeline of new products — such as improved baked goods and a single-serve brewer that was introduced this fall —Starbucks lifted its dividend and guidance for the fiscal year ending in September 2013.
In the year ahead, Starbucks said it also plans to open 1,300 net new stores, up from the 1,063 it opened in the just completed year.
For fiscal 2013, the company now expects to earn between $2.06 and $2.15 per share. That's up from its previous outlook of $2.04 to $2.14 per share and above the $2.14 analysts expected, according to FactSet. The company also raised its quarterly dividend to 21 cents, an increase of 24 percent.
- Middle term
- Make some products available in retail markets during next 5 years.
- Coffee Purchasing: Increased purchases of coffee sourced under C.A.F.E. Practices from 81% to 84% in 2010.
- Farmer Support: Provided $14.6 million to organizations that make loans to coffee farmers, nearing its goal of $20 million by 2015.
- Forest Carbon Programs: Expanded pilots in coffee-growing communities in Chiapas, Mexico and Sumatra, Indonesia through Starbucks partnership with Conservation International to demonstrate how coffee farmers can adapt to and be a solution to addressing climate change while increasing their incomes.
- Long term
- Be as recognizable a brand as Coke.
- Youth Action Grants: Starbucks exceeded its 2018 community goal to engage 50,000 young people in community activities by engaging more than 53,600 in 2012.
- Renewable Energy: Starbucks reached its goal to purchase renewable energy equivalent to half of the electricity used in its North American company-owned stores, by purchasing 58% in 2010; and has been named by the U.S. Environmental Protection Agency as the fourth-largest purchaser of renewable energy in the U.S. The company is raising its sights with a new goal to make 100% of the electricity used in global company-owned stores renewable energy equivalent by 2015.
- In 2010 Starbucks demonstrated progress toward reaching its long term coffee purchasing goals, bringing the company closer to achieving its long-term goal of purchasing 100 percent responsibly grown and ethically traded coffee by 2018.
- Recyclable Cup Solution: Making progress to develop comprehensive recycling solutions for its paper and plastic cups by 2016 by testing recyclability of cups in a New York pilot.1
Decision making process
Perception is a process that all people take part in as we move through the course of events in our daily lives. When we meet people, make business decisions, evaluate performances, or pass judgments, our perception surrounding such events help persuade our next course of direction (Goldstein, 2006). In a sense, perception, accurate or flawed, is our reality. Causes that shape or distort our perceptions have a tremendous effect on the impact of an organization's behavior. Individuals, by nature, develop perceptive shortcuts when passing judgment and inflect both positive and negative effects. Starbucks has realized this importance in the decision making process of its organization and has been successful in modeling guidelines to direct employee behavior and shape corporate perception to aid in its success.
Because Starbucks understands that decisions can be based on perceptions of individuals, influenced by upbringing, beliefs, or current state of mind; models are developed to guide individuals through the process. The creation of these models creates a standard that is followed to deliver a satisfactory result. These models Identify a need, create a process to determine what qualifications will satisfy the need, identify matches to the need, then a decision is made on what match best suites the need. These models are not a perfect solution to the decision making process. Errors and bias still creep in to this process through the use of intuition, gut feelings, experience, and impulse (Robbins, 2005).
In addition, these models try to shape moral and ethical decisions, these models of ethical and moral perceptions focus on rights of the individual and social justice. Standing on the platform of transparency, Starbucks post these models of decision making behavior based on what they call the "Ethical Decision Making Framework" on their website (Starbucks Corporation, 2008). Starbucks list 6 points to this framework to guide and model decision making behavior:
1) Identify the ethical problem.
2) List possible solutions (what could you do?) and any obstacles to resolving the problem.
3) Seek input from others, if appropriate.
4) Determine the best approach (what should you do?).
Is it consistent with our Guiding Principles, the Standards of Business Conduct and any applicable law or regulation?
Would your approach embarrass you or Starbucks?
How would your approach look published in the newspaper?
Would you be comfortable with the example it sets for future decisions?
5) If the path isn't clear, ask for guidance.
6) Follow through on your decision.
In addition to providing these framework guidelines Starbucks makes these statements very clear to each employee:
You are empowered - You can deliver great customer experiences, knowing that Starbucks supports you in doing the right thing and conducting business with integrity.
You have responsibility - You play a critical role in ensuring that Starbucks is a great work environment and in protecting our culture, our reputation and our brand.
You have help - If you are unsure what to do in a situation; you have resources available to you, including the Standards of Business Conduct and the Business Conduct Helpline.
You have a voice - When you believe something isn't right, you can speak up and share your concerns knowing that Starbucks wants to hear them and does not tolerate retaliation against partners. (Starbucks Corporation, 2008)
The corporation uses developed guiding principles and mission statements to guide in the decision making process and these also appear publicly on their website. These models play a vital role in the decision making process. Starbucks has been very successful in its ability to circumvent perceptive errors through the use of relational models. However, even with the use of relational models, errors and bias can still play a role in the decision making process, but the organization has adapted a level of accountability through this process to minimize the impact of errors and bias.2
Organisation
Organisation
Organizational theory and behavior are a vital part of any organization and can be a critical area that determines an organizations success in any industry. If and how these concepts are uniquely applied, organizations can define many different areas of their organizational structure. The Starbucks Corporation has become a well-known globally successful company. In analyzing the application of the organizational behaviors of communication, culture, and decision making, we can determine how these concepts have made this corporation successful.
Organizational Communication
Communication in the Starbucks organization is exceptionally successful. In order to appear transparent as an organization, provide sound direction of communication, maintain solid channels of communication, and still the rumor-mill; Starbucks has taken immense strides in concentrating on this aspect of its organizational behavior.
Although Starbucks goes to no great lengths to define or list their organizational structure (Hawks, Kembell, Kembell, Olsen, & Perry, 2002), Recent changes in the organization define the organization as a matrix structure (Shultz, 2008). These changes in the organization, done to improve the customer experience, helped define the communication directions used by the organization.
Maintaining effective communication, Starbucks uses a model of communication used generally by smaller group networks, all channel communication. All channel communication allows employees to communicate actively with each other, making all members free to contribute (Robbins, 2005). Surely, this channel of communication has contributed to the success of the organization.
The organizational communication extends beyond just the employee and to the customer as well. Starbucks does a great job in using technology, marketing tactics, and their employees to communicate success, goals, and vision to the customer. Examples of this can be seen on the Starbucks website. The website shares the companies guiding principles, vision as a company, social responsibility, and mission statements.
What this has done is allowed the organization to maintain a transparent image. This has helped to still rumors about the organization as these rumors come about. Starbucks has no problem rolling out a time table for important decisions to employees and the public as important decisions that come about. The organization will post on the corporate website and issue press releases that explain decisions and behavior that could cause uncertainty. Starbucks does a great job of illustrating pros and cons of future and current decisions. A good example of this can be seen in a recent posting of the structural changes the organization made in order to maintain stability and continue excellent customer service (Shultz, 2008). This posting, aimed to head off uncertainty and quall the rumor-mill, explains to all partners of the organization (employees) that necessary changes will be made in the organizational structure including consolidation, reorganization, and a stated number of necessary layoffs (Shultz, 2008). These styles of communication will continue to allow the organization to have success in their industry.
Organizational Culture
The Starbucks Corporation presents a strong appeal for potential employees with a strong organizational culture. This culture maintains values that reach every corner of its organization; and reaches outside its walls to the communities as well. Reviewing some of Starbucks' cultural characteristics reveals how successful and appealing this cultural model can be.
Starbucks appeal
Many of the business concepts and the attributes of the Starbucks' organizational culture are very appealing. First, Starbucks has become a well known global entity. This has been achieved by a well recognized product that relies on its quality and unique marketing strategies. Customers can always be expected to be confronted with enthusiastic employees, happy to serve, and focused on the needs presented by their customers. Employees are well trained and have a vast amount of knowledge about all the products offered by their company. The effort that is placed on the quality of their product can be seen by the average consumer. They strive to provide an excellent product and, as proven by their tremendous success, few patrons leave the store with any dissatisfaction. It is apparent that the values and mission statements projected by the company are having great success in creating a strong cultural behavior.
Values
Many of the values held by the Starbucks Corporation business model are shared by consumers and adapted by closely watching organizations. One value that stands out for the company is in community support. According to Starbucks Corporation (2008), they support many community organizations such as Conservation International, The Earthwatch Institute, Save the Children, Mercy Corps, the African Wildlife Foundation, and Planet Green. Values such as this have set standards and send messages that profitable companies have a responsibility to the communities that support their organization and to the needs impacting the environment and the world surrounding them. As well, the Starbucks organization list in its guiding principles the importance of embracing diversity, providing a positive work environment through respect and dignity, and a commitment to satisfying all customers all the time (Starbucks Corporation).
Embodiment of cultural characteristics
Starbucks continues to satisfy employment needs and provide excellent customer service. In part, this success can be attributed to the cultural characteristic of innovation and risk taking. At Starbucks, employees are empowered and encouraged to think outside the box. Hawks, Kembell, Kembell, Olsen, and Perry (2002), tell us that Starbucks encourages and rewards employees for innovative ideas and encourages employees to sway from drink standards to meet the specific request of the consumer.
This leads to the characteristic of attention to detail. Because the company promotes the enthusiastic development and satisfaction of its customers, employees are expected to remain focused on the needs of the customer. In this business, this may mean the development and use of special listening skills and multitasking abilities. Employees, focused on the ever-changing ingredient orders that very from customer to customer, show how valuable this characteristic is to the corporation.
The Starbucks Corporation also exhibits the cultural characteristics of people orientation and team orientation. The company shows employees how important they are to their organization through the decisions they make that impact different members. Some of this can be displayed through the offering of health benefits to part-time employees (Hawks et al., 2002).
Cultural strength
Starbucks maintains a very strong spiritual culture. Marques (2008), states that "Starbucks' performance toward suppliers, communities, employees and customers gives rise to the awareness that Starbucks is one of those corporations that does not explicitly use the term spirituality at work for their actions, nonetheless live it to the fullest." Starbucks shows this spiritual culture in their promotion of fair trade, environmental contributions, workplace diversity, and its self acclaimed statement of employee enlightened self-interest. The bonds that Starbucks' forms with its partners, employees, and community are evident when one simply opens the front door of the establishment.
Starbucks maintains a strong appeal for a great place to work by asserting its strengths in its acquired cultural characteristics, values, and spiritual culture. Many other organizations are adapting these structural concepts after seeing the success of this organization. Starbucks can maintain this strong organizational culture with continuing dedication to its employees and customers. Starbucks has achieved success in corporate culture and has set the bar high. For many organizations this should be a walk-up call to catch up.
Starbucks has teamed up with the Opportunity Finance Network® (OFN) to create and sustain jobs. We call it the Create Jobs for U.S.A. Program. It provides capital grants to select Community Development Financial Institutions (CDFIs). The CDFIs then provide financing to underserved community businesses which include small business loans, community center financing, housing project financing and microfinance.
The Starbucks Foundation has seeded this project with a $5 million donation. You can join in this effort by donating. To recognize your support of the initiative, when you contribute $5 or more you’ll receive a red, white and blue wristband with the message “Indivisible”. Donations are being accepted at Starbucks company-operated stores and online at the Create Jobs for USA site. 3
Directing
Directing
Leadership
During his many years as a senior executive at Starbucks, Howard Behar helped establish the Starbucks culture, which stresses the importance of people over profits. He coached hundreds of leaders at every level and helped the company grow into a world-renowned brand. Now he reveals the ten principles and the memorable wisdom that guided his leadership and success—and not one of them is about coffee.
Behar starts with the idea that if you regard employees
and customers as human beings, everything else will take care of itself.
If you engage your staff as partners (not assets or labor costs), they
will achieve results beyond what is thought possible. And if you think
of your customers and communities as “the people you serve”
(not sources of revenue), you’ll make a deep connection with them,
and they'll come back over and over.
This people-centered approach has been integral to Starbucks from the
start, and remains so today. Behar shares inside stories of turning
points in the company's history, as it fought to hang on to this culture
while growing exponentially. He discusses the importance of knowing
who you are, building trust, facing challenges, listening for the truth,
taking responsibility, saying yes, and daring to dream.
These principles, literally brewed into the way Starbucks works, makes
decisions, confronts problems, and creates opportunities for the future,
are trusted guardrails that anyone can use to lead themselves and lead
others. Behar believes that as work becomes less hierarchical, and as
the world economy becomes more and more about relationships and connecting,
the principles of personal leadership are more important than ever. 4
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10 Principles of Personal Leadership |
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1. Know Who You Are: Wear One Hat | ||
Starbucks believes the power of young people will change the world for the better.
At Starbucks, we continually look for innovative ways to help our communities thrive. As it is said in Sturbacks website : We believe one of the most important ways for communities to come alive is through youth involvement. With Starbucks Youth Action Grants, we hope to nurture and inspire youth to engage, lead and create positive solutions for the challenges they see in their local communities.
In
fiscal year 2011, we awarded more than 100 grants totaling $2.6 million
to organizations around the world to inspire and support youth action
in their local markets.
We’re pleased to continue many partnerships from 2010 both domestically
and abroad due to strong partner (employee) and community engagement
opportunities. This helps to create stability and financial security
for many of the organizations we partner with, including America Scores,
City Year, HandsOn, Jumpstart, International Youth Foundation and Youth
Venture.
These organizations are experts in providing comprehensive support to
young people to help them identify and address needs in their neighborhoods.
Young people also receive advocacy training, financial assistance and
other resources to enable them to make positive change around the world.
Starbucks original goal was to engage 50,000 young people to innovate
and create action in their communities by 2015. We’re proud to share
that through grants awarded in 2009 and 2010, we accomplished this goal
five years early! In partnership with the organizations we support,
we’re now working to articulate a goal that assesses the real impact
of these efforts.
We recently refined the Starbucks™ Youth Action Grants program to the Youth Leadership grants in November 2012.
Goals & Progress: Youth Engagement
Goal: Engage a total of 50,000 young people to innovate and take action in their communities by 2015.
ACHIEVED
We continued to exceed this goal by engaging more than 50,000 youth in community activities 2011.
When we created the Youth Action Grants program in 2008, we set an ambitious goal of engaging 50,000 young people across the globe each year by 2015. Not only did we reach that goal in 2010 with more than 53,000 participants, but we exceeded it again in 2011 with more than 50,000 participants.
In three years we have seen youth-led initiatives create innovative and positive solutions to local needs while empowering young people. The organizations we support with Youth Action Grants reported mobilizing more than 2 million hours of community service and created ripples of change in communities around the world.
In 2012 Youth Action Grants will support projects such as peace education in northwest Pakistan, livelihood skills training for war-affected youth in Uganda, and microcredit to low-income entrepreneurs in Brazil.
Controlling
Controlling
In 2011 Starbucks made organization changes
to enhance customer experiance.
Starbucks communicated several organizational structure changes to its
partners (employees) that will better focus efforts on enhancing the
customer experience. Every year Starbucks has Annual Meeting where
Howard Schultz, president, ceo and chairman outlines five key strategic
customer-facing initiatives that will continue to transform the customer
experience.
And these strategy is sent to every worker of the
company.
Below are some abstracts of Howard Schultz speech
to show the example of Sturbucks work.
«Each division will be led by a senior vice president, reporting directly to the U.S. president. Within each division, partners supporting Store Development, Marketing, Partner Resources and Finance will report directly to their respective functions while still being accountable for results at the divisional level. These teams are being centralized to create an infrastructure with global span, capability and effectiveness.
Support Functions
The reorganizations of Starbucks support functions
are designed to consolidate functional activities into teams that have
a shared vision and goals to support the business.
The following support functions are being reorganized and/or consolidated:
• U.S. Store Development
• U.S. Licensed Stores
• U.S. Finance
• Partner Resources
• Marketing
• In-Store Experience
• Global Supply Chain
• Global Communications
• Partner & Asset Protection
As a result of these organizational changes, some partners may have new roles or new managers.
Partner Care and Support
As I said earlier in this communication, while these decisions were
necessary to move our business forward, I fully recognize the personal
and professional impacts these actions have on individual partners,
and we are committed to making the transitions as smooth as possible».5
Conclusion
Conclusion
Communication, culture, and decision making represent only a small part of the concepts that makeup management strategy of Sturbucks.
As we can see, Starbucks has concentrated on the successful application of these three areas of organizational behavior. With this successful application, Starbucks proudly promotes and shares the models that make them successful to anyone who cares to investigate. As a result, Starbucks continues to be a successful corporation.
The company has been in the business for 4 decades, and undoubtedly has been the industry
leader for almost the same length of time.
Starbucks may have already saturated its current market or its strategy may have
been going into a different direction.
The success of Starbucks Coffee Company is one of the most amazing business stories in decades.
Sturbucks company pays a lot of attention to its workers, customers and image of the company. They really care about everything that connected with them. That is way their management strategy is the one to be an example.
There are several books that describe Starbucks philosophy and internal atmosphere. These are
How Starbucks Saved My Life
It's Not About the Coffee:
- Leadership Principles from a Life at Starbucks
Even when we were preparing our presentation we found a lot of material about the Sturbucks in the Internet that says us that they are really care about their image. And it works.
Since 1992, its stock has risen a staggering 5,000 percent! The genius of Starbucks success lies in its ability to create personalized customer experiences, stimulate business growth, generate profits, energize employees, and secure customer loyalty-all at the same time.
The Starbucks Experience contains a robust blend of home-brewed ingenuity and people-driven philosophies that have made Starbucks one of the world's most admired companies, according toFortune magazine. With unique access to Starbucks personnel and resources, Joseph Michelli discovered that the success of Starbucks is driven by the people who work there-the partners -and the special experience they create for each customer.
Referenses
George, J., & Jones, G. (2005). Understanding and Managing Organizational Behavior (4th ed.). Upper Saddle River, NJ: Pearson Prentice Hall.
Goldstien, E. B. (2006). Sensation and Perception (7th ed.). New York: Wadsworth.
Marques, J. F. (2008). Spiritual performance from an organizational perspective: the Starbucks way. In Corporate Governance (Vol. 8, pp. 248-257). : Emerald Group Publishing Limited. ProQuest Database.
Robbins, S. P. (2005). Organizational Behavior (11th ed.). Upper Saddle River, NJ: Pearson Education.
Shultz, H. (2008). Starbucks Makes Organizational
Changes to Enhance Customer Experience. Retrieved October 22, 2008,
from http://www.starbucks.com/
Starbucks Corporation. (2008). Corporate Social Responsibility.
Retrieved October 15, 2008, from http://www.starbucks.com/
http://www.starbucks.com/
http://www.starbucks.com/
(http://voices.yahoo.com/
(http://news.starbucks.com/
http://www.howardbehar.com/
http://www.starbucks.com/
1 (http://news.starbucks.com/
2 Starbucks Corporation. (2008). Corporate Social Responsibility.
Retrieved October 15, 2008, from http://www.starbucks.com/
3 (http://voices.yahoo.com/
4
http://www.howardbehar.com/
5 (http://news.starbucks.com/

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