Paper on Business Operations of Starbucks Corporation - 2750 Words

Paper on Business Operations of Starbucks Corporation (Essay Sample) Content: Starbucks CorporationNameInstitutionTable of Contents TOC \o "1-2" \h \z \uExecutive Summary PAGEREF _Toc462965312 \h 3Starbucks Cooperation PAGEREF _Toc462965313 \h 4Introduction PAGEREF _Toc462965314 \h 4Sources of Cost and Differentiation Advantage in the Coffee Industry PAGEREF _Toc462965315 \h 5Starbucks Corporation Value Chain Analysis PAGEREF _Toc462965316 \h 7Starbucks Corporation SWOT Analysis PAGEREF _Toc462965317 \h 8Recommendations PAGEREF _Toc462965318 \h 12Conclusion PAGEREF _Toc462965319 \h 13Executive SummaryThis report is about Starbucks Corporation. This is an American coffee company and coffee house chain that was founded in Seattle Washington. This company offers the world some of the finest fresh roasted fresh bean coffees. The growing global position of this corporation is due to its unique taste. This was put in place when Howard Schultz joined the corporation infusing Italian coffee tradition in this coffee business. In addition, he wanted the coffee houses owned by this company to provide consumers with a sense of connection and a homely environment to hold conversations. This report will provide an in depth analysis of this corporation examining its objectives, ownership structures and governing controls. Additionally, it will analyse the basic sources of cost and differentiation advantage in the coffee industry and how Starbucks uses these strategies to gain competitive edge against other companies in the industries. Through a value chain analysis and a SWOT analysis, their resources for competitive advantage are identified and analyzed. Based on this analysis, recommendations will be made on how these strategic resources and the corporate governance can be developed to achieve competitive advantage for this corporation.Starbucks CooperationIntroductionStarbucks Cooperation is an America company that was founded in 1971 in Seattle CITATION Koo10 \l 1033 (Koomsub, 2010). This company is a coffee company that has expan ded its operations to diverse locations including Asian, European and American markets. This company is a marketer, retailer and roaster of high quality coffee. In addition to coffee Starbucks also sells beverages, tea and other food products. They have retail stores all over the world. Starbucks Cooperation aims to provide its customers with high quality accessible and affordable products. Starbucks has a culture of corporate social responsibility. This is emphasized by their mission statement to inspire and nurture the human spirit-one person, one cup and one neighborhood at a time  CITATION Sta16 \l 1033 (Starbucks Corporation). With a focus on this mission, the Starbucks Cooperation promotes cultural development and acceptance. This is reflected in the diversity of their staff, suppliers and their customers. In addition, the company believes that performance can be achieved without sacrificing humanity. For this reason, the company has embarked in many community building pr ojects that bring about development of the communities where they invest in.To ensure smooth running of operational and business functions of this corporation, an organizational structure has been implemented. The company runs its main operations from the Seattle headquarters. The executives of the company oversee operations. In addition, they implement decisions made by the board of directors CITATION Sta161 \l 1033 (Starbucks Corporation). The board of directors makes decisions based on the needs and requirements of their shareholders who amount to over 1500. Starbucks stores are corporate owned of licensed by the corporation to serve as retail stores for their products. This is unlike many of their competitors who function as franchises. Owing to its unique ownership structure, the company has put in place a governance mechanism to ensure efficient and effective operational running. As earlier stated, the Board of Directors of the Starbucks Cooperation ensures the long terms goa ls of the organization are met as well as meet the expectations of the shareholders.Sources of Cost and Differentiation Advantage in the Coffee IndustryStarbucks belong to the coffee retail and snack industry. This is because they mainly deal with coffee, tea and other beverages. These beverages may be accompanied by pastries and other confections prepared in their coffee shops. In this industry, there are several factors that provide cost and differentiating advantage. Firstly, we have the product. Various companies in the coffee industry strive to brings products that are both unique and of high quality to the market. They may do this by targeting specific market groups and meeting their needs. Another source is the price of the commodity CITATION Ylv11 \l 1033 (Bruzelius Johansson, 2011). Affordable products attract a wider customer base even in times of economic crisis. In addition, companies may use distribution to gain competitive advantage by making their products accessibl e and available to their customers. Lastly, promotion can be used by companies in this industry as a source of cost and differentiating advantage. Starbucks has competitors both within and outside the coffee market CITATION Ylv11 \l 1033 (Bruzelius Johansson, 2011). These include Caribou Coffee, Tullys Coffee among others who specialize in the coffee industry. Other competitors outside the industry include Dunkin Donuts, McDonalds CITATION Nit14 \l 1033 (Geereddy, 2014).Based on this information, the following strategic group diagram illustrates the position of Starbucks compared to its major competitors.Based on this diagram, it is clear to see that Starbucks dominates the coffee industry with over 8097 stores in America alone CITATION Kat09 \l 1033 (Lee, 2009). Their competitors have smaller presence in the market. They are divided into second cup stores and other stores. These stores have nearly a third of Starbucks market share. However, competitors such as Dunkin Donuts hav e been growing at a fast rate in the industry trailing Starbucks with a 24.6% market share CITATION Ylv11 \l 1033 (Bruzelius Johansson, 2011).Starbucks uses the product differentiation strategy to gain competitive advantage over its competitors. This is the key strategy they incorporate in their business through offering unique products. In addition, they come up with premium mixes of their products such as the frapuccino. Moreover, their coffee shops and retail stores are situated in premium locations and provide customers with amazing customer service. The coffee company also produces coffee beverages that are unique, of high quality and exceptional. These aspects contribute to making Starbucks one of the worlds leading coffee retailers and producers. This business level strategy has been costly for their competitors to emulate.Starbucks also pursued a unique strategy when it comes to acquisitions. Rather than focusing on a franchising model, Starbucks followed a corporate-owned model with their new acquisitions. Through these acquisitions, they have been able to create a diverse product portfolio. Some of these acquisitions include Bay Breads, Evolution Fresh and Teavana CITATION Sta16 \l 1033 (Starbucks Corporation). Other than product diversification, Starbucks acquisition strategy allowed them to expand their customer base through spreading their stores into various geographical areas all over the world.Starbucks Corporation Value Chain AnalysisTo analysis the value chain of Starbucks Corporation, primary and secondary activities must be considered. Primary activities refer to activities that are mainly enthralled in the daily operations of the company. These activities aid in running the operations and meeting its service or product demands. Secondary activities are those that serve to enhance the efficiency and effectiveness of the primary activities CITATION Dav13 \l 1033 (Buckman, 2013). These activities act as supports thus enhancing the competi tive advantage of the company.The primary activities of Starbucks Corporation include inbound and outbound logistics. Inbound logistics are the elements within the corporation that aid in purchasing of the coffee beans from suppliers from the various locations all the way to the Starbucks storage facilities. From these facilities they are dispersed to their distribution centers. Outbound logistics are the agents through which the corporation is able to get their product to their consumers CITATION Rya08 \l 1033 (Larson, 2008). Starbucks owns retail shops across 65 countries. Moreover, they have licensed shops through which their products can be made available to the market. The outbound logistics is closely related with operations. This is another primary activity that aids the corporation in meeting its goals and objectives. Starbucks business operations are carried out through direct retail stores licensed stores. Another primary activity is service. This is an activity in which the corporation places great emphasis. Lastly, marketing and sales enables the company to run its business operations. Starbucks concentrates on high quality products that are both available and accessible to their customer baseThese activities are supported through the available infrastructure, management of human capital, procurement operations and technological advancements.Starbucks Corporation SWOT AnalysisSWOT analysis of a company or a strategy allows identification and evaluation of its strengths, weaknesses, opportunities and threats. This section of the paper provides a SWOT analysis of Starbucks Corporation. Through this analysis, aims to determine whether the sources Starbucks uses to gain competitive advantage in the industry are strategic resources. Th...

How Microsoft Used Empathy And Definition Of Design Thinking

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Social Responsibility and Hp Essay - 1291 Words

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Organisational Change Management Strategic Global Marketing

Question: Describe about the Organisational Change Management for Strategic Global Marketing. Answer: Case of background: The present study has dealt with the change management followed by Rapid Supply Electronic Components Ltd (RSEC) that helps the company to increase their sales and distribution operation. Andersson et al. (2012) has mentioned that change in organisational structure and business activities to improve their present condition. It is change in the internal environment of the organisation that influences its performance. In the current scenario, it is noticed that Rapid Supply Components Ltd possess decentralized structure and has six different units in different locations of Australia. The company has possessed Electronic Bits Fast (EBF) that also offers electronic components to Australian service users. Therefore, Rapid Supply Electronic Components Ltd has worked on changing the sales, logistic and customer service operations. The business firm endeavours to follow the EBFs centralized function and has decided to manage their business operation from Electronic Bits Fasts head office in Sydney. Therefore, the company has faced certain faces issues from the employees end. It is observed that the most of the workers of RSEC fails accept the change in the organisational function. Therefore, it incorporates stress and anxiety in their mind that affects their performance in the workplace. The staffs feel lack of respect and value in the organisation. Analysis: Identification of problems: In the present scenario, it is observed Rapid Supply Electronic Components Ltd has faced certain issues that affect their business operation. Harmon (2014) has deciphered that change in the business function facilitates stress and anxiety among the employees. Companys decision to change their organisational function creates disappointment and anxiety among the employees. The main reason behind their dissatisfaction is the fact that RSEC has recently overcome the upheaval condition. On other hand, the experience staffs presume that RESCs has provided better service before the acquisition of EBF. The change in firms function creates questions in their mind regarding its effectiveness in the present condition. The workers have thought of ruling over the newly merged company. However, RSECs decision of shifting the head office in EBFs office in Sydney has left their desired objectives unfulfilled. However, workers of RSEC find it an unnecessary act to centralize companys integrated funct ion. The staffs of Rapid Supply Electronics Components Ltd believe that the separate department of the organisation performs well in different parts of the country. Therefore, centralization of work might affect their business operation. It is also very difficult to accumulate the work performed in six different branches. Employees from the logistic, customer service and sales department have understood that they might be transferred from their current locations. On other hand, some of the staffs like members of sales team and deliveries to customers do not need to move from their position. However, the company remains silent regarding the transfers of workers after the initial announcement. Hayes (2014) has stated that fear of employees regarding the unknown changes in the firm affects the business operation. In present case, it is observed that the workers of Rapid Supply Electronics Components Ltd have also feared about the success of this change plan followed by the company. Becker et al. (2013) has opined that the change in organisational system requires cost and time. Here, RSEC has invested money to introduce SAP system, training program for the employees that affects the financial growth of the corporation. The employees also remain doubtful about that benefit ratio in relation to the money in vested in the change management system. In opinion of Hornstein (2015), the selection of wrong solution reduces the chances of increasing the profit margin in the firm. The managers of Rapid Supply Electronic Components Ltd (RSEC) have also suspected the effectiveness of the change function possessed by the company. The managers have also anticipated that they might fail to meet the requirements after the change in management strategy. Problem analysis and justification: In opinion of Waters Rinsler (2014), ADKAR Change Management Model focuses on attaining the desired objectives of the company, following the change in organisational work. The model focuses on making individual or business firm aware of the necessity of the change in business structure. In the current situation of RSEC, the company has failed to make their workers understand the problems faced in the current situation and the need of changing their organisational structure and business function. Therefore, it has created fuss among the staffs of the organisation. The change model of ADKAR has also addressed the desire of individuals working in the business firm to support the change plan (Rosemann vom Brocke, 2015). The active participation of individuals assists the corporation to facilitate their change system. RSEC has lacked in attaining the active participation of employees and managers. Therefore, the company has faced hindrance in incorporating the change the business struct ure. The present change model has also mentioned the importance of knowledge to change the business structure. In the present case, it is noticed that RSEC has faced challenges in deriving appropriate process for following the change function. Therefore, the employees fail to understand the purpose of the change in the business function clearly. According to Shah (2014), ASKAR model focuses on the ability of the company to enable the change in the business function. RSEC has implemented the change plan in the different units of the country. However, lack of cooperation from the workers has lowered the chances of introducing the changes successfully. The business firm fails to gather active participation of managers and employees to make the change plan successful. Pugh (2016) has mentioned that ADKAR change management model has also focused on implementing reinforces to retain the change system prevalent in the company. In case of Rapid Supply Electronic Components Ltd (RSEC), the organisation has confronted issues in sustain the change plan. It is observed that the lack of cooperation from the workers and managers have created troubles in maintain the change system in different outlets of the business firm. RSEC has faced anger and stress of staffs regarding the implementation of the change strategy. The skeptical attitude of individuals working in the company has created challenges in enhancing the change plan to develop the current customer service operation of the company. Alternative solutions: In opinion of Nienhuis (2014), effective communication between employees and organisation helps to enhance the business function. Strong relation with staffs assists the company to attain the desired objectives. It helps the firm to share their goals with the staffs and to take their suggestions for further improvement. In present scenario, communication with workers helps RSEC to make the employees clear about the importance of change [plan considered by the firm. It aids the organisation to possess the support and participation of staffs to improve the logistic and customer service operation (Yaghoubi Hojatizade, 2014). Interaction with employees also aids the company to understand the reason behind their stress and anxiety (Mine, 2015). Therefore, RSEC can take essential steps to provide security to their experienced staffs. It helps to retain the support and loyalty of employees and managers that affects their organisational work. Jeston Nelis (2014) has deciphered that the boa rd members of RSEC to improve must focus on making the employees believe that the possession of EBF is a good investment and the centralization of power will help the to take an effective decision for different branches of the company. It helps the organisation to facilitate the logistic function. The improvement in the logistic operation helps to improve the distribution operation and delivery system. Effective delivery system assists to expend the business in different location of the country (Kerzner, 2013). Training plan for employees helps RSEC to make their vision clear regarding the change in the business structure. The training helps to make the staffs aware of the necessity of centralization to enhance the business function. In opinion of Cameron Green (2015), ethical issues assists the company to distinguish between acceptable and unacceptable behavior. It helps the company to regulate and monitor the activities of employees and managers in the company. It aids the business firm to retain the business morale that helps to retain the reputation of the company. Therefore, RSEC should focus on including ethical objects to maintain the morale in the business work. The company should also work on controlling the excessive changes possessed in recent times. The company should consider small amount of changes in their units to address the initial success. It helps the company to avail success in long run. Gradual changes in the business help to understand the response of workers that helps the company to decide their next step. It assists the company to balance between demands of workers and change needed to improve the business operation. Recommendations: In the present case study of Rapid Supply Electronic Components Ltd, it is followed that the business firm should focus on incorporating coaching plan that helps to send messages to employees regarding the necessity of changing the business function. It aids to make the employees aware of the advantages of the change plan that helps to increase the business function. The coaching plan helps to obtain a direct interaction with the staffs to know their idea about the change followed in the corporation. Their attitude assists to understand the acceptability in the change function of RSEC. The company should consider the training plan that aids to improve the relation with managers and staffs. It helps to dissolve the doubts revolve around their mind regarding their current position in the company. It gives RSEC an opportunity to reinforce the implementation of the change plan to facilitate their sales, logistic and customer service department. The company should also discuss with the wo rkers regarding the change of head office in Sydney. RSEC should consider the importance of their experienced workers and should provide them facilities that affect their service in the work area. The business firm should work on analyzing the affective of the change plan. The company has recently attained stability in the market and the sudden decision of change plan affects their current situation. It might bring success in the current time. However, the success of the plan is questionable in long term. RSEC should work on introducing effective management plan that aids the company to derive the opinion of managers and staffs in incorporating the change system in the business. The introduction of management plan assists the firm to take significant steps to improve their present logistic, sales and customers service operation. The management plan helps to monitor the attitude of managers and workers regarding the change plan that affects the sales operation. It is observed that the effective distribution operation and logistic service helps to improve the business in different parts of the country. The management program of the firm helps to facilitate their customer service operation. It helps to provide better service to the end-users that affects the business function of the corporation. RSEC should work on involving the managers and experiences staffs in their discussions. It also helps to indentify the participation of the workers and managers to improve the business operation of the organisation. Implementation: RESC has considered the importance of introducing management plan that assists the company to dissolve the issues faced by them in current time. The board members of RSEC has worked on obtaining the opinion of managers regarding the decision of changing the location of head office and the incorporation of centralized power to perform the work coherently in different units. It helps the company to make the vision clear to the workers and managers about the change strategy considered in the firm. Rapid Supply Electronic Components Ltd (RSEC) has also worked on improving their communication with the staffs to understand their insecurities regarding the change system in the firm. It helps to consider employees points and to take necessary step to dissolve the issues faced by them. Communication with workers also aids to reduce their fear of losing their position in the firm. It aids the company to take initial steps to retain the trust of their experiences staffs. Firm connection with st affs helps the organisation to attain effective service from them that helps to improve the sales operation. Improvement in sales aids the firm to develop their distribution operation and to customer service system to provide service to wide range of service users in different locations of Australia. References: Andersson, M., Tamanini, J., Asplund, C., Fransson, M., Sporre, M., Parliden, J. (2012). Strategic global marketing of Nordic cleantech clusters and competencies. Becker, J., Kugeler, M., Rosemann, M. (Eds.). (2013).Process management: a guide for the design of business processes. Springer Science Business Media. Cameron, E., Green, M. (2015).Making sense of change management: a complete guide to the models, tools and techniques of organizational change. Kogan Page Publishers. Davenport, T. H. (2013).Process innovation: reengineering work through information technology. Harvard Business Press. Harmon, P. (2014).Business process change. Morgan Kaufmann. Hayes, J. (2014).The theory and practice of change management. Palgrave Macmillan. Hornstein, H. A. (2015). The integration of project management and organizational change management is now a necessity.International Journal of Project Management,33(2), 291-298. Jeston, J., Nelis, J. (2014).Business process management. Routledge. Kerzner, H. R. (2013).Project management: a systems approach to planning, scheduling, and controlling. John Wiley Sons. Mine, M. (2015). Operations Adaptive Management Plan. Nienhuis, J. (2014). Using Change Management to improve CRM User Acceptance. Pugh, L. (2016).Change management in information services. Routledge. Rosemann, M., vom Brocke, J. (2015). The six core elements of business process management. InHandbook on Business Process Management 1(pp. 105-122). Springer Berlin Heidelberg. Shah, M. H. (2014). An Application of ADKAR Change Model for the Change Management Competencies of School Heads in Pakistan.Journal of Managerial Sciences,8(1). Waters, D., Rinsler, S. (2014).Global logistics: New directions in supply chain management. Kogan Page Publishers. Yaghoubi, N. M., Hojatizade, M. (2014). Human resource management and ERP system: An integrated model.International Journal of Research in Organizational Behavior and Human Resource Management,2(4), 113-126.