Knowledge Management of Starbucks | Report

Running head: KNOWLEDGE MANAGEMENT
Knowledge management of Starbucks
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Table of contents
Introduction................................................................................................................................2
Findings......................................................................................................................................2
Critical analysis of the anticipated findings...............................................................................3
Theoretical aspects and concepts of knowledge management...................................................6
Recommendations......................................................................................................................8
Conclusion..................................................................................................................................8
References..................................................................................................................................9

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Introduction
Executing the operations needs practical application of the essential skills, knowledge
and expertise from the employees. The managerial roles and responsibilities are enhanced
when they manage the knowledge invested by the employees. This is through the means of
performance management reviews, appraisals, evaluations and audits. These initiatives are
effective in terms of detecting the areas in which modifications are needed for upgrading the
standards of the employee performance to that of the professional growth (Liebowitz, 2019).
Mention can also be made of the knowledge management systems, which are used for
controlling and managing the knowledge for executing the operations according to the
requirements. This assignment attempts to shed light on the knowledge management
techniques used by Starbucks for fulfilling the identified goals and objectives.
Findings
It was in the era of 2008, when Starbucks encountered drastic crisis in terms of
undisciplined growth and focus. One of the major concerns was that the stock declined to
almost 70%. In such a scenario, Howard Schulz took over as the CEO. Refocusing on the
core business strategies boosted the business towards the organic growth. Stability was added
into the operations, as in the era of 2014, the stock price reached $40 (Harvard.edu, 2019).
The major drive behind this is the tactful approach of Schulz regarding equal inclusion of
assets, liabilities, brand image and marketing opportunities in the marketing strategies. Five
year growth plan acted as an agent in terms of increasing the sales revenue from $16 billion
to $30 billion. Along with this, there was a simultaneous growth in the operating income,
which expanded the scope and arena of the business increasing the number of footprints for
the stores. The growth plan covered seven segments, among which one was the New
Occasions Strategy. In this strategy, Hislop, Bosua and Helms, (2018) opines that the
objectives was diversification of the revenues by increasing the menu beyond breakfast,

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lunch and dinner. Addition in this was the evening snacks for luring more clients and
customers.
Critical analysis of the anticipated findings
Strategic approach towards marketing is assistance for the brands in terms of
achieving the desired outcomes. This is segmented into the markets, which they intend to
enter, single market, multi-market and the total market, which assesses the market position as
compared to the contemporary brands (Webb, 2017). Aligning the case of Starbucks, the
growth strategies consists of the seven components, which are:
 Be the employer of choice
 Emerge as a market leader in the sale of coffee
 Expand the scope and arena of the portfolios for the stores
 Creation of new occasions
 CPG brand growth
 Building Teavana
 Expanding the engagement to the social media
Among these aspects, the main focus is on the creation of new occasions for increasing
the trafficking of the audience towards the brand image. This has been intended to be
achieved through the means of launching more stores, which would be fully equipped with
new products. Further narrowing down the search, it can be specified that plans have been
constructed for increasing the afternoon and the evening dayparts (Donate & de Pablo, 2015).
In the lunch, the plans includes expansion of the sandwich platforms by adding more
varieties, which would be effective for influencing the purchasing decision and power of the
clients and the customers.

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The lunch menu is also to include salad, sandwiches, barbecue reef, brisket sandwich,
which would be presented in a lucrative manner. Prepackaged bistro boxes are a means of
conducting marketing mix for the lunch menus. Acquisition of Bay Area bakery chain La
Boulange reflects the expansion in the scale of operations. Decision to close retail stores
indicates merging the operations into the retail operations. Programs like Evening Store
Programs catered to the local customers of Seattle. Variation was present in the platter, which
included wine, craft beer, traffle mac and cheesebreads. In this case, the target audience was
the friends, office colleagues intending to take a break after a hard day’s work. According to
Soto-Acosta and Cegarra-Navarro, (2016), this identification was apt in terms of enhancing
the sales revenue and the profit margin.
Consciousness was attached to the peak rush hours and the time when the traffic was
traditionally low. Example of this lies in the identification of the fact that after 4 PM, the
traffic was less, as the customers demanded caffeine late in the day. One of the other
parameters of the growth plan is that of expansion in the production capacities, which was
achieved by Starbucks through the means of infrastructural development. Typical evidence of
this is alteration of the seating arrangements in such a way that the customers can be properly
accommodated for the Evening Program. Sensory experts were hired for inspecting the
quality of the wines produced, which sufficed the need for implementing the final decision
regarding placing them in the stores for display (Mäntymäki & Riemer, 2016).
Further segmentation of the post lunch menu is a latest addition in the growth strategies.
This approach can be considered as a means for maintaining the balance between the internal
and external environment. As a matter of specification, it can be said that the approach was a
slow and gradual progression towards strengthening the customer base through the means of
infrastructural development. The Sunset menu seemed to be an addition in the source of
income for Starbucks from the customers like that of the young adults, families, friends,

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colleagues an others. An interesting issue in this context is that the customers eating the
breakfasts can try the sunset menus (Inkinen, 2016). Consciousness was exposed towards
maintaining the traditionalism in the dietary habits of the customers. As a result of this,
positive word of mouth advertisements was generated, which proved to be effective for
expanding the customer base. Uniqueness was reflected from altering the taste and texture of
some of the dishes, which can be correlated with the strategy of product diversification.
Objectives are an important part of the strategies, which improves the focus of the
business for the companies and organizations. In case of Starbucks, New Occasion Strategy
proved to be effective for luring more and more customers. As a matter of specification, this
strategy acted assistance for expanding the scope and arena of the business to the threshold of
the foreign markets. Diversification of revenue in the menus relates to the strategy of product
differentiation and diversification, which increases the market share (Todorović et al., 2015).
The approach of creating new occasions enabled Starbucks to acquire 15% of the revenues,
which were acquired by the contemporaries through the scheme of Quick Service Restaurants
(QSR) with focus on the servings of the morning. Comparative studies reflect that the total
QSR business in terms of evening, afternoon, and lunch and morning servings in US accounts
for 15%. On the contrary, evening, afternoon and lunch totals to 54% in case of Starbucks.
Incremental revenues reached to $1 billion from the other daypart servings for Starbucks.
In this context, mention can be made of the continuous improvement strategies, which was
undertaken for upgrading the standards and quality of the products. Feedbacks were collected
for ensuring whether the strategies align with the identified aims and objectives. Mention can
be made of K-cups in the Keurig brewing machines, which relates to the strategy of product
development for penetrating into the foreign markets (Handfield et al., 2015). For catering to
the ease of the customers, special facilities were introduced delivery of the coffee at their

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tables and desks. Along with this, mention can be made of the app services, which would
provide the access to the customers to order coffee and sandwich from the office.
Special packages are offered to the customers, who come with their friends and
colleagues to socialize in the evening time. The delivery is made within the stipulated time,
so that the customers can get back to their work stations within one hour.
Theoretical aspects and concepts of knowledge
management
Knowledge sharing culture is important in terms of averting the instances of
discrimination, harassments and conflicts. Taxonomy or classification of the individuals into
groups is assistance for the brands like Starbucks to gain knowledge about the specific tastes
and preferences. Fidel, Schlesinger and Cervera, (2015) opines that this approach is effective
for identification of the target audience through the means of experimenting with the current
marketing mix. Business process improvement relates with the evaluation and audits, which
helps in detecting the areas in which modification is needed for reaching to the benchmarks.
Metrics is used for measuring the extent to which the operations of managing are knowledge
are effective.
Intellectual capital is one of the other essential components, which caters to the
efficiency in the operations of Starbucks. One of the segments is that of the human capital,
which caters to the management of the human resources. ICT is adopted by the managers for
evaluating the contribution of the employees towards diversifying and differentiating the
menus (Kianto, Sáenz & Aramburu, 2017). Design thinking is a means, which adds
innovation into the process of expanding the product line and the offerings. Innovation Labs
suffice the need for catering to Quality Control and Assurance. Job-to-be-done proves
beneficial for the brands like Starbucks to expand the scope and arena of the business beyond
the demographics. The anatomy of this concept projects the relationship between dimensions

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and circumstances, which leads to the desired outcomes. For instance, situational analysis of
the approaches towards availing the services of renovated menus in breakfast, lunch, snacks
and morning helps in excavating the fact that the customers coming with the collagues prefer
the snack menu, as they can refresh themselves with the refreshing drinks and the snacks
(Heisig et al., 2016).
Data asset management is conducted through conglomeration of the data and human
interpretation, which results in the formation of information to be shared and used for
executing the operations. On the contrary, information and human usage of the resources and
capabilities results in the formation of knowledge. The information related to the menu
alteration and diversification is done through four levels: expertise, knowledge, information
and data. When the employees make practical application of the learnt skills and knowledge,
the possessed knowledge becomes information. When the employees of Starbucks are
encouraged to conduct self-evaluation for the exposed performance, the information is
transferred into the status of data. Khan and Vorley, (2017) is of the view that upon receiving
training, the experience of the employees are concretized, which enhances their
individualism.
Knowledge and skill management competencies revolve around experience, behaviour,
attributes, tasks, specialities and components in the performance. In case of Starbucks, the
employees are instructed to read books on the tastes and preferences of the customers in
terms of food and beverages. Community participation is a means for expanding the scope
and arena of the corporate social responsibility. Subscription offers are levied for the
community members and associate partners. Conferences is one of the means for
disseminating the plans to the stakeholders and shareholders. The presentation of the dishes is
done in a lucrative manner in the conferences, which acts as an effective agent for luring
large number of clients and customers towards the brand image (Hwang, Lin & Shin, 2018).

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Social media marketing proves beneficial for assessing the approaches of the customers
towards the introduced menus. Quizzes, contests are a means for reaching to the specific
tastes and preference of the customers.
One of the other aspects is that of design thinking, which enables the brands like
Starbucks to alter the outlook of the business scenario. In this context, change management
strategies are effective for bringing the proposed change into the business in an efficient and
effective manner. The considerable facts in this context were system/tools, interactions and
artefacts.
Recommendations
 To add the menus in the social networking sites like Facebook and Instagram
 To acquire capital for setting up new stores
 To indulge in contact with the transport dealers for transporting the products from the
factories to the stores
 To adopt celebrity endorsements for expanding the customer base
Conclusion
New Occasion Strategy is apt for Starbucks in terms of diversifying the products and
the options. Social media marketing is an effective means for luring the traffic towards the
brand image. New stores would add value to the distribution channels, enhancing the
parameter of the public relations. Experimenting with the recipes would be an initiative for
influencing the tastes of the customers. Job to be done relates to the aspect of revising the
recruitment and selection strategies and policies, which would help Starbucks in assessing
why they need to hire skilled and efficient people at this juncture of the business operations.

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References
Donate, M. J., & de Pablo, J. D. S. (2015). The role of knowledge-oriented leadership in
knowledge management practices and innovation. Journal of Business Research, 68(2), 360-
370.
Fidel, P., Schlesinger, W., & Cervera, A. (2015). Collaborating to innovate: Effects on
customer knowledge management and performance. Journal of business research, 68(7),
1426-1428.
Handfield, R. B., Cousins, P. D., Lawson, B., & Petersen, K. J. (2015). How can supply
management really improve performance? A knowledge‐based model of alignment
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Harvard.edu (2019). Starbucks: driving growth through new dining occasions. Retrieved 18th
Dec 2019 from https://hbsp.harvard.edu/product/KE1079-PDF-ENG
Heisig, P., Suraj, O. A., Kianto, A., Kemboi, C., Perez Arrau, G., & Fathi Easa, N. (2016).
Knowledge management and business performance: global experts’ views on future research
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Hislop, D., Bosua, R., & Helms, R. (2018). Knowledge management in organizations: A
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Hwang, Y., Lin, H., & Shin, D. (2018). Knowledge system commitment and knowledge
sharing intention: The role of personal information management motivation. International
Journal of Information Management, 39, 220-227.
Inkinen, H. (2016). Review of empirical research on knowledge management practices and
firm performance. Journal of knowledge management, 20(2), 230-257.

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Khan, Z., & Vorley, T. (2017). Big data text analytics: an enabler of knowledge management.
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Kianto, A., Sáenz, J., & Aramburu, N. (2017). Knowledge-based human resource
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Soto-Acosta, P., & Cegarra-Navarro, J. G. (2016). New ICTs for knowledge management in
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Todorović, M. L., Petrović, D. Č., Mihić, M. M., Obradović, V. L., & Bushuyev, S. D.
(2015). Project success analysis framework: A knowledge-based approach in project
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Webb, S. P. (2017). Knowledge management: Linchpin of change. Routledge.