Financial Performance Management: Analysis of Starbucks

Running head: FINANCIAL PERFORMANCE MANAGEMENT
Financial Performance Management
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FINANCIAL PERFORMANCE MANAGEMENT
Table of Contents
Introduction......................................................................................................................................2
Balanced Scorecard Approach.........................................................................................................2
Total Quality Management..............................................................................................................8
Benchmarking................................................................................................................................10
Conclusion.....................................................................................................................................12
Reference.......................................................................................................................................13
Appendix........................................................................................................................................16

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Introduction
The main purpose of this assessment is to analyze the financial performance of Starbucks
for two years periods which is 2016 and 2017. The assessment considers the business of
Starbucks is an American coffee company which has presence globally with stores in excess of
28,000 with a majority of stores in the US. The assessment also identifies the usefulness of
Balanced Scorecard in the management of the business and how the same can help to improve
the overall performance of the business. The four perspectives of the balance scorecard is
explained in relation to the business of starbucks. The assessment also considers the impacts of
total quality management on the performance of the business. The assessment also considers the
usefulness of Benchmarking as a tool for comparing the performance of the business with other
close competitors.
Balanced Scorecard Approach
Balanced Scorecard can be defined as a tool which is used to effectively measure the
performance of the business and formulate strategies for the purpose of meeting the performance
objectives of the business (Hoque, 2014). There are four aspects which needs to be considered by
the business in a Balanced Scorecard Approach such Financial perspective, customer
perspectives, internal perspectives and learning and growth perspective.
In the last few years the profitability and growth of Starbucks has decreased significantly
and therefore the management is planning to incorporate a Balance scorecard approach to
improve the overall performance of the business. In case of many companies, adopting the
balanced scorecard approach has significantly help the organization in improving and maintain
the performance of the business (Keyes, 2016). The management of Starbucks can effectively

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plan regarding their strategies in such a way that the performance objectives of the business is
the primary focus of the organization. The advantages of balanced scorecard which can be
identified with respect to the business of Starbucks are listed below in details:
 Provides a Clear Picture: The balance scorecard approach provides clear set of
objectives and strategies which is to be undertaken by the management for meeting the
goals of the business (Hansen & Schaltegger, 2016). In addition to this, Balanced
Scorecard allows the business to effectively monitor the finances and performance of the
business.
 Monitors Performance: The management of Starbucks will be able to monitor the
performance of the business as well as the employees with the help of a balanced
Scorecard. An example can be given of the sales team of the Starbucks can keep records
for sales which is achieved by each sales personnel (Reefke & Trocchi, 2013). This keeps
the performance of the business under check and also increases the overall efficiency of
the business.
 Considers the different aspects of Business: The management of Starbucks considers
the aspect of customer satisfaction and customer loyalty to be of highest importance to
the business for which Balanced Scorecard can improve the performance of the business
significantly.
The disadvantages which are associated with Balanced Scorecard incorporation in the
business of Starbucks are listed below:
 Expensive and time Consuming: The process of implementing balance scorecard
approach in the business of Starbucks is an expensive process and requires a lot of