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Starbucks: Contemporary Developments in Business and Management

   

Added on  2019-10-01

22 Pages5248 Words301 Views
[Year]Starbucks: Contemporary Developments in Business and Management[DOCUMENT SUBTITLE]STEPHEN OMOROGHOMWAN

Running Head: Business ReportContentsOverview.....................................................................................................................................................3Task 1..........................................................................................................................................................4Primary external influences.....................................................................................................................4Importance of External influences to the Organization............................................................................8Task 2: Demographic Factors....................................................................................................................10Influence of Demographic factors on Policies and Decision-making within Starbucks.........................11Critical evaluation of the effectiveness of the company’s response.......................................................13Areas of improvement in the responses.................................................................................................15Conclusion.................................................................................................................................................16References.................................................................................................................................................17Appendices................................................................................................................................................21Appendix 1: Company Profile...............................................................................................................212

Running Head: Business ReportOverviewManagement plays a pivotal role in the every organization or business as it clearly determinesthe short and the long-term goals for the business along with the variety of strategies that couldbe employed to achieve them in the given time frame. In the recent times, the researchers in thisfield are constantly reporting the presence of a number of interlinked variables that interacts tohighly influence the ways in which a firm delivers its services. The following report has been written undertaking the discussion over a leading AmericanCoffee Company and a Coffee house chain, Starbucks. In the first part, the report will closelyevaluate the Primary external factors that influence the working of the company. In the secondsegment, the report will unveil the myriads of demographic factors that are constantlyinfluencing the working methodologies, Policies and Decision-making process of this leadinggiant. In this part the responses from the company towards these influences are also criticallyevaluated along with the suggestion of areas of improvement [ CITATION NGe13 \l 1033 ]. 3

Running Head: Business ReportTask 1There are a number of factors that could not be voluntarily controlled by the company and at thesame time have the potential to highly influence the internal workings and strategic operations ofthe firm. The executives of the firm are required to analyze these factors and evaluate thestrategies that could be readily incorporated to manage these factors in the best possible manner.This is needed because the nature and impact of these factors are unpredictable and with timethese factors can either be beneficial or harmful. So, if evaluated in a proper way then thecompany could use these factors for yielding lucrative results.Primary external influencesThe Primary external influences often remain similar for most of the industries in the market;however, their level of influence may vary. The leading companies always keep a number ofcontingency plans to tackle the ill influence of these factors, but the way in which these plans areimprovised creates a difference. The crucially identified primary external factors for Starbucks are:1.Globalization: At present, Starbucks has over 15,012 stores in around 44countries across the world and this has allowed it to be a Globalization Icon. The company isstriving to become a global brand and for this it has tripled its revenues over the past 5 years.To increase the pace of the growth the country has not only targeted all sorts of markets in itshomeland, but has also amended its taste to meet the needs of the customers outside the US.Starbucks has tried to bring American- style coffee sales to international marketplacesregardless of the volatile political and economic situations of different countries [ CITATIONKBe08 \l 1033 ]. 4

Running Head: Business ReportThe company has not only invested its resources in expanding its business internationally bygaining customers from all over the world, but at the same time the company has also hiredhighly experienced MBAs and Corporate Executives from different parts of the world todeliver high quality services to its customers. Globalization has allowed the company tounderstand different tastes of the people across the world and what all changes could thecompany make in its operations to attract the consumers with different tastes [ CITATION RHa11 \l 1033 ].2.Environmental Policy: Different nations have a different Environmental lawsand policies to which a foreign company adheres in order to deliver its services without anyhindrance. The Environmental laws of some of the Asian and European countries are quitestrict and hence any new foreign entrant needs to follow it in a proper manner [ CITATIONMNN10 \l 1033 ].The environmental policies allow a company to deliver its services in a sustainable manner andavoid any sort of contribution in the pollution levels in the environment. This also helps inmaintaining a good and respectable position among the competitors and also builds a loyalrelationship with the sensitive target market segments of the society. The company, at present, is indulging in a number of recycling and waste-treatment activities.The company has launched the industry’s first hot beverage cup with 10% post-consumerrecycled fiber. The company also started an initiative of using ceramic cups and a gooddiscount to those customers who bought cups of their own. Apart from recycling, the companyis also concerned with the water use and has announced to reduce the water wastage by 25%till the end of the year 2016 [ CITATION Sta164 \l 1033 ]. 5

Running Head: Business ReportThe company’s success highly depends upon the type of Coffee beans it is supplied with and ifan Environmental disaster hits a country in the coming future hen it may have a drastic impacton the quality of the coffee beans being supplied to the outlets. The quality and production ofCoffee may also be hampered by the Global warming issues prevailing in the world. Theincrement in the earth’s temperature due to Global warming patterns may also change theduration and occurrence of the Winter Season. As winter is the most desirable season for thecoffee lovers, hence this might lower the sales for the firm in this particular season [ CITATIONMPa161 \l 1033 ]. 3.Competition: Starbucks is currently leading the Coffee retail market by selling itsproducts at the premium prices to increase their profitability. But the emerging competition inthe Coffee industry is posing a great threat to the existence of the Starbucks in the current andpotential markets. The major competitors for the company are Dunkin’ Donuts, McDonald’sand Caribou Coffee [ CITATION JHa151 \l 1033 ]. In the year 2002, Dunkin’ Donuts entered in the business of espresso beverages. For a betterexpansion of its business, the company entered into a partnership with Proctor and Gamble tosell the Coffee in the Grocery stores. On the same line, McDonald’s began to offer premiumcoffee at a cheaper price than Starbucks. As Starbucks also offers coffee beans and groundcoffee in retail and grocery stores around the world so there are other competitors too in themarkets including Maxwell House and Folgers. Both of these companies dominate the drycoffee goods market and hence give a great competition to Starbucks [ CITATION WWh16 \l1033 ]. 6

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