Module 3 Critical Thinking: Portfolio Proposal The study of managing change in today’s dynamic business environments greatly benefits from an insightful examination of leaders and organizations that have successfully engaged in strategic renewal. Perhaps more than any other recent change effort, the extraordinary revitalization of Starbucks Coffee Company represents a compelling example of successful change. Confronted by the cumulative impact of multiple internal and external performance pressures, Starbucks, led by the return of CEO Howard Schultz in 2008, engaged in a comprehensive well-formulated process for change that brought the company back from the brink of potentially catastrophic failure (Schultz, 2011). In response to requirements for the ORG521 portfolio project, this paper proposes an in-depth analysis of the change process that Starbucks followed in the company’s quest for strategic renewal. A summary description of the Starbucks Coffee Company follows the discussion. Reasons for Choosing Starbucks An in-depth analysis of Starbucks’ process for strategic renewal serves an excellent reference for studying the essential elements of successful change. Relative to the learning objectives articulated in the portfolio rubrics (“Course Documents” n.d.), three important reasons emerge from preliminary study for analyzing the Starbucks process for change. First, although the change process that guided Starbucks’ recovery toward a more sustainable business model closely parallels Lewin’s three-stage model of planned change (Schein, 1996), Schultz’s passion for his company added one important dimension – a visionary context for change (Schultz, 2011). The embedding of Schultz’s new vision into the change process created ... ... middle of paper ... ...ewin's change theory in the field and in the classroom: Notes toward a model of managed learning. Reflections, 1(1), 59-74. doi:10.1162/152417399570287 Schein, E. (2004). Organizational culture and leadership (3rd ed.). San Francisco: Jossey-Bass. Schultz, H. (2011). Onward: How Starbucks fought for its life without losing its soul. New York: Rodale. Spector, B. (2010). Implementing organizational change: Theory and practice (2nd ed.). Boston: Prentiss Hall. “Starbucks Corporation,” (n.d.): Datamonitor Company Profiles Authority. Retrieved from EBSCOhost database. Starbucks' quest for healthy growth: An interview with Howard Schultz. (2011). McKinsey Quarterly, (2), 34-43. Retrieved from Business Source Premier database. Zegler, J. (2010, June). New initiatives expand Starbuck’s reach. Beverage Industry 101(18), 62. Retrieved from ABI/INFORM Trade & Industry.
External and internal pressures arising from dynamically evolving business environments inevitably and continuously create unsustainable tension between the desire for stability and the need for change within organizations (Graetz & Smith, 2010). Organizations respond to these tensions by engaging in strategic renewal processes through the implementation of “planned change” (Spector, 2010). Planned change, according to Cummings and Worley (2009), fundamentally concerns the process of changing organizational behaviors. More specifically, new behaviors must replace old ones or be adapted to or integrated with existing behaviors to enable successful change (Palmer, Dunford, & Akin, 2009; Schein, 1993, 2004). This paper outlines the three stages of Lewin’s model of planned change – unfreezing, movement, and refreezing – and discusses the importance of each relative to changing employee behaviors.
The structure of Starbucks business communication is exceptional. Rather you are in their store buying a Caramel Frappuccino®, visiting their website or watching one of their advertisements on television; as the consumer, the message is loud and clear. Pick up any newspaper and you are likely to find an article about the coffee giant. Starbucks pledges a commitment to their over 172,000 partners (employees) and the community. “We realize our people are the cornerstone of our success, and we know that their ideas, commitment and connection to our customers are truly the essential elements in the Starbucks Experience” (Starbucks, 2008).
Starbucks not only shapes a defined importance on its product, the coffee, but also the relationships on its partners, its customers and its shareholders to create diversity, “to create a place where each of us can be ourselves” (Starbucks Coffee), to treat all related partners with dignity and respect at the greatest corporate level. In this sense, Starbucks involves its customers, its neighbors and is shareholders to participate in the community to “be a force for positive action—bringing together [its] partners, customers, and the community to contribute every day (Starbucks Coffee).
Change is interdependent on other variables like size, environment, organization type and power. An organization should monitor and re-assess its change strategy as a shift in any of the variables affects its implementation and requires realignment of strategies. For effective change, progress has to be monitored and feedback should be acted upon continuously. Accepting and altering what can be noticed as a wrong strategy in the change process should be acceptable to all, however, it can only be done, if the organization can have a team to monitor the progress of change, Nelson (2003). Walton and Russel, (2004), discuss that restructuring, downsizing, deregulation, explosive growth and change in business models are some of the changes that
Finally, this report will identify recomendations for Starbucks to minimze future loss and to compete with major competitors like McCafe and Gloria Jeans Coffee.
... middle of paper ... ... Strategic planning kit for dummies, 2nd edition. Retrieved from http://www.dummies.com/how-to/content/strategic-planning-diversification.html “Starbucks”.
Starbucks case study: background 1971-87; private company 1987-92. (1997). McGraw-Hill Companies. Retrieved March 20, 2007, from the McGraw-Hill Companies website: http://www.mhhe.com/business/management/thompson/11e/case/starbucks-1.html
Shultz, H & Gordon, J 2011, Onward: How Starbucks Fought for Its Life without Losing Its Soul, Rodale Books, Pennsylvania.
One of the main problems that Starbucks is facing at the present time is the ability to maintain national competitive advantage (Monash South Africa, 2014). Due to their local demand conditions, Starbucks tries to satisfy all customers by trying “to inspire and nurture the human spirit – one person, one cup and one neighborhood at a time” (Starbucks Corporation, 2014). Local demand conditons consist of a company trying satisfy needs of their closest customers and expanding their competitive advantage by upgrading their strategic management policies (Monash South Africa, 2014).
Starbucks is a worldwide company, known for is delicious brews of coffee and seasonal varieties of tasty drinks for any occasion. Starbucks opened with two main goals, sharing great coffee with friends and to help make the world a little better. It originated in the historic Pike Place Market of Seattle, Washington in 1971 by Jerry Baldwin, Zev Siegl and Gordon Bowker. The creation of Starbucks’ name came from the seafaring tradition of early coffee traders and the romance evoked from Moby Dick. At the time, this individual shop specialized in the towering quality of coffee over competitors and other brewing services enabling its growth to becoming the largest coffee chain in Washington with numerous locations. In the early 1980s, the current CEO Schultz saw an opportunity for growth in the niche market. After a trip to Italy he brought back the idea of a café style environment of leisure and social meetings to the United States we now see in Starbucks locations today. Schultz ultimately left Starbucks to open his own coffee shop, Il Giornale which turned out to be a tremendous success. Fast forward a year later, Schultz got wind that Starbucks was going to sell all their components of Starbucks including their stores and factories, he immediately acquired the funds to buy Starbucks and linked both operations. Within five years he was able to open more than 125 stores starting in New England, Boston, Chicago, and gradually entered California. He wanted Starbucks to be a franchise system based on the mission of telling the truth and emphasize the quality,
At the end of my interview I will try to suggest what steps should be made to keep the company in continuing its quest to become one of the most recognized and respected brands in the world. Introduction With clear core values towards providing quality coffee, the best service, and atmosphere, Starbucks has enjoyed great success since it was founded 30 years ago. The company has been doing very well for the last 11 years with 5% or more store sales increase, even with the rest of the economy still reeling from the post-9/11 recession. However, recent research, conducted by Starbucks, has shown some concerns regarding the company’s problem meeting customers’ expectations.
Millions of Americans these days depend on the glorious caffeine rich nectar provided to them daily by the local Starbucks chain store. With it’s humble roots firmly planted in Seattle Washington, this little coffee shop has turned from a novel idea, into a veritable necessity for Americans on the go. The amazing success of Starbucks can be attributed, in part, to tactical planning. It was through tactical planning that the management team behind Starbucks was able to be so wildly successful. By utilizing their strengths, and capitalizing on trends, as well as periodically evaluating weaknesses and threats, this little coffee joint has become America’s most enjoyable place to get coffee.
Usually that revenue growth is in line with the growth of the economy”. I believe there are thousands of students contributing to Starbucks 's growth today. “As a result, mature companies tend to engage more in inorganic growth to fuel innovation. That means acquiring start-ups or middle-sized companies”. Not all products have been a home run for Starbucks. A lot of their flavored lattes, recipe process, technology endeavors have been part of the declining stage as well. However, Starbucks does have product extension for some items and they tend to return them ever so often due to holiday or
Strategic management is a key element to carry success to global agenda. At the first step of Starbucks’ strategic management, the company’s vision and mission are, ‘’To establish Starbucks as the premier purveyor of the finest coffee in the world while maintaining our uncompromising principles while we grow.” and ‘’To inspire and nurture the human spirit–one person, one cup, and one neighborhood at a time.’’ Shultz wanted to provide people no matter their age, profession, or location with a unique experience that a coffeehouse as a place to relax, work, and socialize. He analyze the market and identify company’s internal strengths & weaknesses and external opportunities & threats. His strategy was offering customers the “Starbucks experience”, that means superior customer service, a ‘community experience which based on the Italian café model, a friendly ambience in its stores. Also it empowers customers to drive change especially in terms of customization, peer to peer marketing and consumer awareness. Moreover, Starbucks seeks brand loyalty and offers perks to frequent customers instead of doing investment to advertisement sector. Starbucks is radically different from the others in this last point.