Starbucks initially was a small structure, run by three partners in a small shop in Seattle. The company then was restricted to selling only whole bean and ground coffee. It was typically a top down structure were the three people in the top management were the decision makers. In 1984, when Schultz suggested the idea of selling coffee and expresso drinks, the directors of Starbucks rejected the idea, in spite of the fact that the move would have made more profit for the company. This displayed the rigidity of the management towards any changes in the business.
After taking over the operation of Starbucks in 1987, Schultz decided to expand the company's business. The next few years brought some positive changes to Starbucks. Starting with 17 stores in 1987, the company quickly expanded by opening stores in Chicago and Portland. With this period of expansion, Schultz hired some experienced people to help him manage the growth plans. In 1989, Schultz hired Howard Behar, who was familiar with opening and running several retail stores. A year later, Schultz brought in Orin Smith as the Chief Finance and Operations Officer. Both Behar and Smith were highly experienced in the industry and helped Schultz build the company's infrastructure.
The new structure of Starbucks was flat and it encouraged competitive ideas from all levels of the company. This necessarily depicted a lateral coordination c...
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...ffman Neilson(2008), Strategy & Business
2) Shultz, H. (2008) Starbucks makes organizational changes to enhance customer experience. Retrieved March 13, 2008, from, http://www.starbucks.com/aboutus/pressdesc.asp?id=831
3) George, J. and Jones, G. (2005). Understanding and Managing Organizational Behavior. (4th ed.)Upper Saddle River, NJ: Pearson Prentice Hall.
4) Gulati Hoffman Neilson, Strategy & Business, 2008
5) Barbero, Martin, Starbucks goal: Recapture its early buzz, Jan 2008.
6) Hoovers Database
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