Operations Management in Starbucks

MANAGEMENT &
OPERATIONS

Table of Contents
INTRODUCTION...........................................................................................................................3
TASK1.............................................................................................................................................3
Covered in PPT.......................................................................................................................3
TASK2.............................................................................................................................................3
P2. Role of a leader and function of a manager apply in different situations........................3
P3. Apple different theories and models of approach............................................................4
TASK3.............................................................................................................................................6
P4. Important approaches to operation management and the role of leaders and managers in it.
................................................................................................................................................6
P5. Importance and value of operation management in present business world....................7
TASK4.............................................................................................................................................8
P6. Assess the factors within business environment which has an impact on operation
management............................................................................................................................8
CONCLUSION................................................................................................................................9
REFERENCE.................................................................................................................................11

INTRODUCTION
Management and operation is a very crucial term in present business world because
everything needs to be managed properly and appropriately. Management is the art which are
used by manager of the company for planning, organisation, directing and controlling the
different set of activities (Smith, Maull and CL Ng, 2014). Operations is the term which is used
to manage the internal working of the company so that it runs as effectively and efficiently as
possible. Organisation undertaken in this report is Starbucks which has initiated its operations
from the year 1971 and serves products and services like coffee, smoothies, tea, baked goods,
sandwiches, etc. This report will explain the different role of a leader and a manager by
considering the differences and similarities between them. The report will also apply the range of
management accounting techniques. The report will further demonstrate an appreciation of the
leaders roles and managers play in the operation function of an organisation. The later part will
provide and understanding of the relationship between leadership and management.
TASK1
Covered in PPT.
TASK2
P2. Role of a leader and function of a manager apply in different situations.
The business organisations faces various situations from the external and internal world
and in each situation, it has different role of a leader and manager. The following are the
different business situations which can be faced by the Starbucks:
Speedy changing situations
The speedy or rapid changing business situations are the ones where the changes in
external business environment creates a need for changes. For instance, if the political conditions
of the country is highly inflexible and unstable then this will have a significant impact on the
operations and functions of the company (Slack and Brandon-Jones, 2018). If government of UK
raises the tax rate then this will adversely impact the Starbucks. In such case, the role of leader
will be to adopt autocratic leadership style where quick decisions will be taken in order to deal
with the changes prevailing in the external world. The role of manager under such case will be to
assess the external business environment. They will develop the plan and make decisions

regarding the manner in which the company will deal with such change. The manager will devise
that when tax rate will increase then either company will minimise the quantity of their products
at same price or providing the same quantity at increased price and select the options which will
best for maintaining the level of profitability.
Slow changing situations
During the period of slow changing situations where the business environment is highly
stable then Starbucks can effectively think of introducing new products and services for their
customers (Schwarz, Hall and Shibli, 2015). Suppose, they think to introduce the new and
innovative beverages for the customers then role of leader will be to adopt democratic leadership
style. In such style, the leader will consult their subordinates and takes their feedback in order to
accomplish the business goals and objectives. By adopting democratic leadership style, the
leader will be able to generate the attention among subordinates because they will feel motivated
and also inspired by taking part in decision making process (Schönsleben, 2016). While the role
of manager will be to assess and evaluate the market trends which will help the company in
identifying the customer needs and requirements and response towards the idea of introducing
new beverage. The manager will make proper plan by critically evaluating all the relevant factors
and due to stable business world, they will thoroughly examine each and every business
situation.
P3. Apple different theories and models of approach.
Situational leadership: The situational leadership is one where the leaders and manager
of the organisations are highly flexible in nature and adjust themselves according to the different
business situations (Reid and Sanders, 2015). They adopt that leadership style which fits best in
the appropriate business situations. Thus, leaders of Starbucks must be able to move themselves
from one leadership style to another in order to accomplish business goals and objectives.
Strength Weakness
 This leadership theory is highly flexible
in nature and develops a comfortable
working atmosphere for the employees.
 It generates the ability among the
people to work in team. This helps in
 This leadership theory has a major
drawback of concentrating on current
need rather than the long term benefit.
 This is highly ineffective approach
when proper approach has been defined

generating better and more productive
results such that business goals can be
attained effectively.
by the management of the company for
performing a particular work.
System leadership: The theory of system leadership will allow the leaders of the
Starbucks to create the conditions which will work immensely at all the levels in order to
improve the productivity (Ravindran, 2016). This leadership theory develops principles about
human behaviour so that the approaches of good leadership, organisational strategy, system
designs, etc. can be accomplished. By using this leadership theory in practice, the leader of
Starbucks can easily and effectively forecast the behaviour of individual in organisation.
Strength Weaknesses
 This leadership is very effective and
efficient and helpful in accomplishing
individual and organisational goals and
objectives.
 Furthermore, this leadership style has a
strong emphasis on the multiple
dimensions of the businesses.
 This leadership has a drawback that it
may or may not be able to be practical
and leads to postponement or delays in
taking decisions.
 The classification of different
organisational activities has to be done
properly otherwise it can lead to
counter productive results.
Contingency leadership: The contingency leadership style is emphasised on the
effectiveness of leader which is dependent on matching the leaders style to the correct situation.
This leadership style has three factors which are to be taken into consideration that is relation
between leader and manager, task structure and positional power (Mahadevan, 2015).
Strength Weaknesses
 There is a huge level of flexibility in
the operations where different tasks are
required to be performed at different
level.
 It is reactive in nature and it becomes
very difficult for handling situations at
times.
 Apart from this, identifying the
different aspects of the situation can be

 This approach helps in enhancing the
decision making and leadership skills
which further helps in accomplishing
the business goals and objectives.
subjective in nature and may lack the
reality of the situation.
TASK3
P4. Important approaches to operation management and the role of leaders and managers in it
Six sigma
The concept of six sigma is an important approach which is used by the management. It
is a highly disciplined, statistical based and data driven approach which requires continuous
improvements in order to accomplish business goals and objectives (Khanna, 2015). This helps
in advocating the qualitative measurements of the success and works on defining various aspects
within the business sphere. The Starbucks canuse six sigma because this will help in minimising
the cost incurred during the manufacturing process and also improves the level of productivity.
With this, the organisation can further helps in identifying and resolving products and defected
parts and leads to minimisation of the variation within the process. Under this, the role of leader
will be to recognize the importance of using six sigma as a management strategy and leader will
focus on motivating and influencing people working in the Starbucks to work with full potential
and ability such that business goals and objectives can be attained (Kato and. et. al., 2015).
Furthermore, the role of manager will be to use the DMAIC plan in which the manager will
focus on defining the relevant problem, measuring the same, taking corrective action,
implementing the same and controlling the same so that assurance can be given relating to the
improvement of efficiency.
Lean manufacturing
The concept of lean manufacturing is concerned with reducing the waste within the
manufacturing systems and maximising the productivity. The lean approach is based on thorough
evaluation of the processes. This concept focuses on customers in order to make customers
focussed towards the value. By adopting lean manufacturing in practice, the Starbucks will be
able to save a lot of time and money. It provides proper customer relationship management
where there will be less interruptions, maximised sustainability, provides effective and pleasant

working atmosphere. The role of leader under this will be to act as a guide or coach. Leader
provides proper training to the team and other members so that business goals and objectives can
be attained effectively and efficiently. Leader is responsible for creating an environment which
enhances the continuous and regular improvement by regularly motivating the people through
different means which will accomplish business goals and objectives effectively and efficiently.
The role of a manager under this is to identify that whether the appropriate funds and equipments
are available in the organisation so that the lean practice can be accomplished (Kapadia and. et.
al., 2018). They are also responsible for controlling regularly that the applied practised is
generating the expected results and if not then corrective actions are required to be taken.
P5. Importance and value of operation management in present business world.
Operations management refers to stream of management through which there is in
performing business operations in better and synchronize manner. This stream makes business
activities properly controlled and designed and achieve set targeted (Song and Parola, 2015).
managers of Starbucks has to consider principles of operations management through which raw
material gets converted into finished goods in order to serve best services to consumers and
maintain proper balance between profits and costs. With the help of operations management,
there is proper coordination and activities are performed in sequential manner. Starbucks is
coffee house and it operates all around the world, there are different organisations working in
same sector. Hence it is essential to provide best quality products and services which is possible
with making proper planning related to conducting operations in better and effective manner.
Importance of operations management is as under-
Maintaining quality of product- With the help of operations management, there is
security of quality aspects which creates good brand image in mind of consumers. When
business operations are conducted in sequential and synchronise manner then it is easy to
complete roles and responsibilities within specified time. This makes consumers retain for long
time with Starbucks which is core aim of organisation because with this Starbucks is able to
maintain long term resistance in industry (Stadtler, 2015).
Customer satisfaction- Customer satisfaction is the key through which business can exist
in industry for long term. When all the departments are aware about their business operations,
then they performs activities properly and consumer's waiting time gets reduced. Operations

management assist Starbucks in maintaining quality of products which are provides consumers
as per their preferences. Hence with the help of operations management to provide satisfactory
services to consumers and increase revenue.
Reduction in wastage- Starbucks is coffee shop which have different outlets, so it is
responsibility of managers to assign job roles to workers properly (Stevenson and Sum, 2014).
This reduces possibilities of duplication of activities and provide timely services to consumers.
With reduction in wastage, cost of production will be reduced which is main aim of business
enterprise. When cost is low, then price of product will be affordable for consumers. So
reduction in wastage will provide satisfactory services to consumers.
Increment in revenue- Operations management refers to performing business activities
in proper synchronise way with considering quality aspects. Starbucks is the organisation having
good brand image, so they are price maker. This is because of serving best quality products to
consumers as per their preferences. Hence with the help of operations management, business
objective of increment in revenue can be achieved. So there is increment in revenues of
Starbucks.
Hence it is clear that with the help of operations management, it is easy to maintain good
brand image which makes long term relations with consumers. Possibilities of duplication of
activities get reduced which leads to maintain cost efficiency and increasing revenue. (Wu, 2016)
TASK4
P6. Assess the factors within business environment which has an impact on operation
management.
The business environment is a very broad concept which comprises of various internal
and external factors which can significantly impact the operation management of the company
and influences the decision making in Starbucks. The following are the some of the factors
which have an impact on Starbucks:
Corporate social responsibility: The concept of corporate social responsibility is the
combination of societal advantageous programs and practices into the corporations business
framework and culture. The primary aim of this model is to maximise the long term profitability
for the businesses in order to create their image in the market by depicting their contribution to
the social communities. The companies are investing a lot in CSR activities (Hoyos, Morales and

Akhavan-Tabatabaei, 2015). When Starbucks will engage in corporate social responsibility, in
its operations then this will enable them in committing their business that they will act in an
ethical manner and contributes towards the economic development by maximising the quality of
life of the labour and employees. It further helps in assuring the sustainability of the business
such that the workforce will make use of available scarce resources effectively and efficiently.
Stakeholder: The stakeholder are the people who are associated with the organisation
directly and indirectly and have a strong level of influence on the decision making. For instance,
customers are the key stakeholder in Starbucks from whom the revenue and profits are
generated. It is very crucial to keep them always happy and satisfied because dissatisfied
customer can affect the company adversely. The another important stakeholder is the employee
who works to fulfil the customer needs and requirements. It is very important that employee
always remain motivated towards their work and for this, Starbucks must provide them with
financial and non financial rewards to their employees and at the same time proper employment
legislation must be adopted by the organisation in order to attain business goals and objectives.
Political factors: There are various political factors which are related to the intervention
of the government and stability of the country (Hitt, Xu and Carnes, 2016). It includes taxation,
subsidies, import, export policies, , etc. For instance, if the taxation prices increases then this will
directly have an impact on the profitability and prices of the Starbucks because with the rise in
taxation, either the company will have to minimise the quantity of its products or maximise the
prices for the same products. This will affect the company in maintaining the level of
profitability. This will have a crucial impact on leaders and managers where leader will apply the
autocratic leadership style and rapidly takes the decision and manager predicts the future and
develop new plans and policies for the betterment of the company.
CONCLUSION
From the above report it has been concluded that management and operations plays a
vital role in the growth and success of the company. Leaders and managers are two different
person who with their immense abilities and skills can lead to the company to the greater heights.
There are various role which are required to be performed by the manager in order to accomplish
business goals and objectives. Furthermore, leader has used several leadership styles in their
actions for making people work towards the business goals. Apart from this, to remove the
defects and problems, various approaches of management like six sigma and lean manufacturing

are used in order to attain the business goals by maximising effectiveness and minimising
defects.

REFERENCE
Books and Journals
Hitt, M. A., Xu, K. and Carnes, C. M., 2016. Resource based theory in operations management
research. Journal of Operations Management.41. pp.77-94.
Hoyos, M. C., Morales, R. S. and Akhavan-Tabatabaei, R., 2015. OR models with stochastic
components in disaster operations management: A literature survey. Computers &
Industrial Engineering.82. pp.183-197.
Kapadia, S., and. et. al., 2018. Operations, administration and management (OAM) in overlay
data center environments. U.S. Patent Application 10/116,559.
Kato, T., and. et. al., 2015. Operations management methods and devices thereof in information-
processing systems. U.S. Patent 9,128,704.
Khanna, R.B., 2015. Production and operations management. PHI Learning Pvt. Ltd..
Mahadevan, B., 2015. Operations management: Theory and practice. Pearson Education India.
Ravindran, A. R., 2016. Operations research and management science handbook. Crc Press.
Reid, R. D. and Sanders, N. R., 2015. Operations Management, Binder Ready Version: An
Integrated Approach. John Wiley & Sons.
Schönsleben, P., 2016. Integral logistics management: operations and supply chain management
within and across companies. CRC Press.
Schwarz, E. C., Hall, S.A. and Shibli, S., 2015. Sport facility operations management: A global
perspective. Routledge.
Slack, N. and Brandon-Jones, A., 2018. Operations and process management: principles and
practice for strategic impact. Pearson UK.
Smith, L., Maull, R. and CL Ng, I., 2014. Servitization and operations management: a service
dominant-logic approach. International Journal of Operations & Production
Management.34(2). pp.242-269.
Song, D. W. and Parola, F., 2015. Strategising port logistics management and operations for
value creation in global supply chains.
Stadtler, H., 2015. Supply chain management: An overview. In Supply chain management and
advanced planning (pp. 3-28). Springer, Berlin, Heidelberg.
Stevenson, W.J. and Sum, C.C., 2014. Operations management. McGraw-Hill Education.
Wu, C. L., 2016. Airline operations and delay management: insights from airline economics,
networks and strategic schedule planning. Routledge.