HRM and Performance at Starbucks

The given assignment is about analyzing Human Resource Management (HRM) at Starbucks, focusing on commitment, restraint, and dimensions. It requires identifying relevant concepts from literature, such as HRM, IVR, and cultural differences. The assignment also involves using case studies of successful organizations like Toyota and Starbucks to demonstrate effective HRM practices.

OFFICIAL
MANAGING THE HUMAN RESOURCE
MANAGING THE HUMAN
RESOURCE
Assessment
STUDENT NAME -
COURSE - MBA
MANAGEMENT CONSULTANCY
UNIVERSITY OF WALES
STUDENT NUMBER -
WORD COUNT - 4366
1

OFFICIAL
MANAGING THE HUMAN RESOURCE
INDEX
1.1High Commitment Human Recourse Management……………………………………… 3
1.2 Abraham Maslow’s Hierarchy of needs…………………………………………………. 4
1.3 Herzberg two factors theory………………………………………………………………. 6
2.1 Internal labour markets and job Security……………...………………………………… 8
2.2 Recruitment process; hiring, selection of right candidates..……….….……………... 9
2.3 A learning culture through continuous Training and development.………………….. 11
2.4 Active employee involvement…………………………………………………………….. 12
2.5 Team working and self-management……………………………….……………………. 13
2.6 Reasonable pay and performance based rewards....…………………………………. 14
2.7 Reduction of status differentials/harmonisation……………………………………….. 15
3.1 Best Fit………………………………………………………………………………………. 15
3.2 Effective HRM Planning and advantages of Committed HRM
Strategic Implementation………………………………………………………………….. 17
3.3 Recommendations for a successful High Commitment HRM………………………… 18
Bibliography………………………………………………………………………………………. 20
Abbreviation
HRM………… Human Resource Management
HR…………… Human Resource
2

OFFICIAL
MANAGING THE HUMAN RESOURCE
1.1 High Commitment Human Recourse Management
Comparing to other established academic subjects such as politics, economics, law… etc,
human resource management (HRM) is relatively a new area of study. In the past HRM is
mostly associated with personnel management and industrial relations. There are several
definitions and developments in HRM in the past and is identified as one of the key features
of a sustainable business entity.
Generally HRM is “a philosophy of people management based on the belief that human
resources are uniquely important to sustained business success. An organisation gains
competitive advantage by using its people effectively, drawing on their expertise and
ingenuity to meet clearly defined objectives. HRM is aimed at recruiting capable, flexible and
committed people, managing and rewarding their performance and developing key
competencies” (Price, 2004, p.35).
Selznick (1957) highlights Organisational possession of idiosyncratic competence to
outperform competitors, further supported by Penrose (1959) categorising physical and
human resources as the ‘collection of productive resources’. HRM is an important strategic
element, which drive core competencies to deliver advantages to the organisation. Barney
(1991) used a SWOT analysis to stress the advantages of internal strengths and to reduce
the effect of internal weaknesses.
Ideally there are 4 dominant types of HR strategies depending on locus of control and ‘make
or buy aspect.’ (Bamberger and Meshoulam, 2000)
A high commitment HR strategy compromise with
 Internal staff development, high investment in training
3

OFFICIAL
MANAGING THE HUMAN RESOURCE
 Less compliance with process based standards, develop psychological contract
with mutual respect, trust focusing on outcomes.
High commitment HRM practices are “commitment oriented HRM practices not only
encourage employees’ motivation and willingness to contribute but also help forge a stronger
psychological connection between employees and organisations” (Arthur, 1994, p.677)
1.2 Abraham Maslow’s Hierarchy of needs
Human motivation and moral behaviour consist of five universal needs. It is necessary to
fulfil Bottom level needs prior moving to top levels. This theory illustrates relationship
between motivation and moral against performance. Less motivation and moral impact staff
dissatisfaction leading to employees leaving the business resulting high employee turnover.
Less staff turnover at Starbucks, comparing to the retail industry implies fulfilment of staff
needs and High committed HRM.
www.forrester.com
Motivation is important to achieve organisational goals. “The desire to achieve beyond
expectations, being driven by internal rather than external factors, and to be involved in
continues striving for improvement” (Torrington et al., 2002, p.335).
4

OFFICIAL
MANAGING THE HUMAN RESOURCE
Morris (1981) defined morale as the individuals’ (groups) spirit and willingness to perform
assigned tasks. High morale of Starbucks staff positively associates with productivity, state
of mind, efficiency, psychological condition, performance and effectiveness.
Despite limitations, Maslow attempted listing human needs in a systematic order. Such
attempts have been a key to the development of High Commitment HRM. According to
Maslow's, achieving satisfaction is fulfilling needs.
Maslow’s theory reflects,
1. How needs group associate with different levels. Maslow underpins existence of
a standardised way in which these needs group and common solutions are
available. Author argues employee’s motivation, morale and attitudes are
influenced by external factors and depend on personal circumstance.
Another factor is individuals’ attitudes towards work and how high level of needs
can be satisfied through work. This is common in organisations practicing
Traditional HRM and adopts a ‘one-size-fits-all’ approach.
2. What is the most important level of need and its distinction between other levels
of needs? A solution through such ambiguous prediction is not possible.
3. A universal theory. Needs hierarchy fails to differentiate needs of individuals and
different cultures.
In high committed HRM employees require flexibility of choosing their own bespoke bundle
of benefits. Starbucks unique ‘your special blend’ compensation package is an example of
High committed HRM providing staff to decide what set of benefits they need.
Employee motivators are the needs on higher levels at Maslow’s hierarchy. They consist of
recognition, opportunities, responsibility and certain job specific factors which decide neither
the satisfaction nor the dissatisfaction for growth towards self-actualisation.
Starbucks provides low and middle level needs; by restricting existence of a staff Union,
implies restrictions to self-actualisation and social equality as part of High Commitment
HRM.
5

OFFICIAL
MANAGING THE HUMAN RESOURCE
1.3 Herzberg two factors theory
Frederick Herzberg argued there are two factors influencing motivation; Hygiene factors and
Motivator factors. Herzberg’s theory does not directly debate motivation or morale; theory
discusses job satisfaction at work providing the right working environment. From a
contemporary view, Motivator-Hygiene theory is based on factors contributing employees’
behaviour at work. Hygiene factors prevent dissatisfaction and pain. Example - working
conditions, company policies, administration and interpersonal relationships. Author’s
argument is that existences of such factors provide limited motivation.
Herzberg two factors theory (www.wordpress.com)
Bowen (1980) identified recognition, achievement, work-life balance, possibility of growth,
advancement, salary, policy and administration, interpersonal relations, supervision,
responsibility, working conditions and the work itself as motivator-hygiene factors.
Starbucks has created a great place to work environment even providing informal social
networking within the organisation using schemes such as ‘partner connection’, on-site
fitness programmes, ‘the wonderful world of food’ and ‘the new parent network’.
Importantly the flexible work schedules enable employees a greater degree of work-life
balance. Enhanced health treatment schemes are motivators for employees to retain in the
organisation. Author argues about the work flexibility at Starbucks. Starbucks provide part
time working opportunities. Comparatively to which extend Starbucks is actually flexible?
Flexible work categorically differ from part time working to flexitime, home-working, term-time
working, structured time off in lieu, compressed hours, annualised hours, job share and
staggered hours.(www.direct.gov.uk).
6

OFFICIAL
MANAGING THE HUMAN RESOURCE
Bowen (1980) states Herzberg's theory cannot be applied worker groups as the initial study
was conducted based on Accountants and Engineers. Author’s criticisms are,
1. Theory is less likely applies for unskilled and non-professional workers where the
majority of jobs are repetitive and monotonous though often presented with least
job satisfaction. Also some employees do not like the contents of their job
regardless of motivating factors.
Starbucks high commitment HRM provides high degree of Motivator-Hygiene
factors, though majority of staff are employed at sales positions conducting a
routine job function.
2. Methodology employed by Herzberg had influences on the responding
interviewers. Motivator-Hygiene factors of Accountants and Engineers cannot be
compared with front line sales persons.
Theoretically actions and practices of Starbucks provides clear adherence to
improve motivation and hygiene factors but still not practical in the long term due
to high HRM costs.
Mullins (2005) stated favourable reflections of peoples’ performances are likely to attribute
motivating incidents at work. External influences and efforts of other people are attributing to
dissatisfying hygiene. Notwithstanding criticisms of Herzberg's theory, Herzberg illustrated
worker motivation by drawing attention to job design and job enrichment.
Starbucks conducted staff surveys to analyse, evaluate and review HRM practices and with
the high ratio of staff satisfaction concludes employees’ appreciation and acceptance,
proving high commitment HRM at Starbucks. ‘MUG’, ‘Bravo’ and ‘Spirit of Starbucks Awards’
are several recognitions and rewards through employee achievements.
There are five principles embedded to Starbucks corporate strategy to drive high
commitment HRM.
1. HRM Planning
2. Staffing (selection, recruiting)
3. Staff development, Review and evaluation
4. Compensation
5. Managing effective work-force relations
7

OFFICIAL
MANAGING THE HUMAN RESOURCE
Many contemporary organisations including Starbucks adopt high commitment HRM. Pfeffer
(1994) developed a list of 16 best practices and later (Pfeffer, 1998) concise to 7 factors.
Seven components to of high commitment HRM (Pfeffer, 1998)
 Employment security and internal labour markets
 Selective hiring and sophisticated selection
 Extensive training, learning and development
 Employee involvement, information sharing and worker voice
 Self-managed teams/team working
 High compensation contingent on performance
 Reduction of status differentials/harmonisation
2.1 Internal labour markets and job Security
Pfeffer (1998) identified employment security is the principal expectation of employees about
their employment security, promotions and career development. High commitment HRM
avoids job losses by possible internal transfers, redeployment and TUPE transfers while
expecting no compulsory redundancy; only use temporary staff to protect the core workforce
& corporate HR vision of employing new starters until they retire.
Author argues about job security guarantee in high commitment HRM. Job security is a high
commitment HRM objective but organisation’s has a corporate financial objective of
maximise corporate profits. Job security relies on corporate strategy, demand and supply
forecast of workforce regardless of HRM commitments.
Starbucks had to increase their premium price to cover HRM costs. Author argues about
Starbucks’ contingency plan for rising HR costs. There is a cap that the consumer prepared
to pay for a product regardless of its optimum service. Alternatively Starbucks can introduce
staff benefits packages based on corporate performance to reduce fixed HR costs.
Additionally outsourcing of functions such as HR, pay-roll, logistics and process automation,
re-engineering can be used to minimise operating costs.
Starbuck’s staff matching model for a better HR cycle
Traditional HRM used to match job requirements with the abilities, skills and experience
(Person-job fits). Contemporary practice is towards hiring people who fits for the
organisation’s culture (Person-Organisational fit). Most companies believe that the skills and
experience can be developed using trainings, but peoples’ attitudes cannot be changed
8

OFFICIAL
MANAGING THE HUMAN RESOURCE
easily. Therefore it is highly vital to select and retain the staff to match the organisational
culture. Starbuck’s recruitment and selection model sifts new recruits to match the Starbucks
culture.
 Selection of best staff
- Required qualities and competencies posted on Starbucks job adverts
- Enable prospective employees to self-select them to a certain extend in the
Starbucks application process
 Recruitment process
 Induction “facilitate transition of persons in to social roles and statuses that are new for
them” (Trice and Beyer, 1993. p.111). Trainings are focused on different components of
the individual’s requirements to fulfil the organisational requirements.
Starbucks is heavily investing on their overall recruitment process. It is a common aspect in
high commitment HRM. Starbucks Induction and training are inclusive of,
- High investments
- Comprehensive for all employees
- First Impression (24 hour Induction at regional office)
When recruiting management trainees, they are required participating a lengthy extensive
training to familiarise them to the Starbucks culture.
2.2 Recruitment process; hiring and selection of right candidates
Planning for hiring involves obtaining right people in right numbers. Recruits need to possess
right knowledge (skills and experience) to effectively do the right job. At all the time,
recruitment functions need to conduct at the right place incurring the right cost. High
commitment HRM tends to recruit the best people to match the organisational socio-culture,
interpersonal skills, attitudes and commitment to drive the Organisational objectives in a
team environment to accomplish goals and objectives. The technical skills and experience
can be provided by a committed learning culture within the organisation. Starbucks applies a
systematic well defined process which uses sophisticated selection techniques to attract and
retain the targeted employees as it is a non-negotiable key aspect of high commitment HRM.
Redman and Wilkinson (2009) presents a balanced selection process consists of
organisational goals, macro and micro environments, applicants and outcomes. External
9

OFFICIAL
MANAGING THE HUMAN RESOURCE
environment can be broadly assessed by– political, economic, socio-cultural, technological,
environmental and legal factors a (PESTEL framework).
Especially the economic factors are influencing the labour markets and the supply of skilled
labour. Demographic changes such as diverse work forces, changing priorities of job
applicants and legal requirements such as discrimination, equal opportunity, disability
(Guaranteed Interview schemes) has to be adhered unless can be objectively justified.
Therefore the External environment impacting the high commitment HRM and organisational
HR strategy with,
 Skills needs (demand) and supply
 Monitoring, segmenting and targeting the suitable employees
 Use of attractive incentives
 Efficient integrated systematic approach.
The high commitment HRM systematic recruitment process includes pre-recruitment
activities such as job analysis (task based or worker based attributes), applications,
psychometric tests, reasoning tests, structured interviews (telephone and followed by a face-
to-face), role plays, work sampling to increase the possibility of hiring the right candidate to
fit for the job. Person specifications, positive behaviour, ‘can do’ attitudes, cognitive ability,
performance, competencies are assessed in a high commitment HRM other than skills and
mere qualifications.
Redman and Wilkinson’s Recruitment Framework
Organisation is an element of this framework. Organisation’s size, culture and HR strategy is
pressured by industry, growth level, financial stability; geographical operational location(s)
which impacts the recruiting process. Large and most multinational companies continuously
recruit and formally use specialist consultants on HR strategy.
There is a functional shift of traditional HR towards line management, centralisation of
divisional HRM to a central unit and even the recruitment processes are outsourced to
external organisations (agencies and head hunters, specialise in recruitment). These
strategies are in place to attract high quality employees, to shorten lengthy recruitment
processes and reduce costs to improve efficiencies. Starbucks need to adopt such strategies
to minimise costs and to recruit best fitting staff.
High commitment HRM encourages internal recruitment for the jobs. This strategy has to be
only implemented if the position requires high skills and knowledge unique to the
10

OFFICIAL
MANAGING THE HUMAN RESOURCE
organisation, as this process may require lengthy and costly trainings than recruiting a
suitable external candidate. If the recruitment is conducted externally it is more beneficial if
the vacancy is a short-term relationship. Ex – temporary and short term contracts.
As described by Redman and Wilkinson (2009) in high commitment HRM there are 5
indicators of psychometric quality.
1. Reliable and valid assessment tools
2. High validity assessment tools for a low adverse impact
3. Assessment of non-cognitive quality
4. Bespoke simulations
5. Online delivery of assessments
Nevertheless these selection practices and decisions are biased and influenced by
economic pressure (short term and long term), social pressure and stakeholder pressure. On
the other hand the applicant should identify the organisation is a positive place to work. From
the organisations perspective it is important to recruit the right candidate resulting positive
post-hire outcomes.
If the organisational culture is not fitting with the candidate it is very likely that the recruits’
leaving the job and the organisation has to complete another cycle of recruitment, costly
trainings to fill the HR gaps. Long serving staff at Starbucks reflects the credibility of their
recruitment process to acquire people to fits with the culture.
2.3 A learning culture through continuous training and development
Providing comprehensive quality trainings and development to staff is a responsibility of the
employer which develops the work place skills portfolios, integrated to the way work is
designed (on-the-job trainings) and to gain competitive advantages.
Sloman (1994) introduced a high committed logical systematic series of training and learning
adding competitive advantage to organisations.
 Training policy
 Methodical identification of training requirements
 Training objective and training plan
 Implementation of training plan and continuously validate, update, evaluate and
review training as a whole process
11

OFFICIAL
MANAGING THE HUMAN RESOURCE
 Addressing skills gaps (At Starbucks - general awareness of retail business, Coffee
making skills and its history…etc)
Starbucks recruits the best fitting, outstanding, talented, skilled employees. Then ensure,
demonstrate and facilitate continues learning and development as it is an important element
of high commitment HRM. There are different but common types of measures for training
and development in quantitative (financial) aspect,
 Number of worker trained
 Number of training hours
 Training Budget (Amount spent)
According to high commitment HRM, the time and effort devoted for training, quality (focus,
delivery) and amount of training received by workers are important. In the same time if the
worker is overqualified, trainings may not additionally improve the worker or organisational
performance; in that scenario the aim of learning and development objectives are failed.
Author suggests that the measurement of learning and development drives the organisation
to improve continuous performance. On-the-job trainings such as cash register, coffee
recipes conducted by experienced store managers at Starbucks are example of high
performance orientated high committed HRM.
Author criticise the lengthy extended training of 8-12 weeks for the Management trainees.
Instead of such costly, lengthy training schedule, Starbucks can offer on-the-job training
while maintaining required standards and training curriculum.
2.4 Active employee involvement
Organisations need to involve employees actively and allow worker to raise their voice and
share information. Employee engagement is a main component of high commitment HRM.
Marchington and Wilkinson (2005) developed a framework on the depth of employee
participation. The two ends demonstrate high and low level employee participation.
At Information level, employees are simply informed of the management decisions. First
level of participation starts at the communication level and its peak is the control level, where
employees can influence decisions (In normal circumstances decision making is dependent
on the management).
12

OFFICIAL
MANAGING THE HUMAN RESOURCE
This framework illustrates depth of employee participation, involvement and empowerment.
Provide information sharing and open communications about organisational performance,
strategic change, strategic direction and issues embedding a positive bond and mutual trust
amongst the employee and employer. The whole organisation to work as a team, effective
use of upward and downward communications, enabling suggestions and consultation of
employees to improve performance instead of impractical isolated management decision.
Starbucks Mission Review programme allows employees to raise their voice and
communicate upwards.
The involvement of trade union representation in an Organisation, raise employee voice and
contribute towards high commitment HRM. By firing employees who tried to form unions at
Starbucks, develops anxiety about true staff participation and job security, which reflects
autocratic management power in Starbucks.
2.5 Team working and self-management
Teamwork leads to cooperative decision making, creative results for issues, high level of
team’s motivation, commitment, making best use of the people’s abilities, shifting the locus
of control from Managers to team members, but in reality it is rare that the availability of
categorically ‘autonomous groups’ who has the responsibility for managing own work and
time as practically it is difficult to implement. Many organisations claim worker empowerment
giving an impression of control without power or influence. Starbucks provide opportunity to
employees to take over day-to-day management and decision making.
High commitment HRM supports the team working and worker empowerment. Author argues
that team working may lead to a negative impact on lower skilled workers and their
performance. People are different; while one employee is willing to take responsibility
another might not want to take additional responsibility and stress of decision making. Such
13

OFFICIAL
MANAGING THE HUMAN RESOURCE
practices can lead employee dissatisfaction and people feel pressured by asked to do a
manager’s job for a worker’s pay.
2.6 Reasonable pay and performance based rewards
“As strategic and integrated approach to increasing the effectiveness of organisations by
improving the performance of people who work in them and by developing the capabilities of
team and individual contributors” (Armstrong and Baron, 1998, p.7)
There are several factors in the compensation element.
1. Lower than average
2. higher than average
3. performance-related
Organisations should reflect different levels of contribution rather than a common bonus,
profit sharing or company shares based on employees pay to attract and retain high
committed employees. In a high commitment HRM practice, performance appraisals are the
key factors used to determine compensation. Starbucks currently has a share incentive plan;
‘bean stock’, giving employees a stake of the organisation depending on company
performance and based on employee’s annual salary.
Incentives prove the organisation’s high commitment HRM practice. Author argues, instead
corporate performance, if the measurement is based on individual performance, it will further
motivate individuals; improve their productivity; increases organisational performance. To
implement such incentives, Starbucks require a more visible thorough individual
performance appraisal method.
Author argues what is the fair basis of appraisal assessment for workers compensation as
each line manager may assess performance according to their personal perspectives.
Starbucks can obtain performance information using five primary sources identified by Noe
et al (2010) considering strategic themes of reward driven integration and development
driven integration.
These primary sources are,
1. Managers 2. Peers
3. Subordinates 4. Self &
14

OFFICIAL
MANAGING THE HUMAN RESOURCE
5. Customers
Additionally if Starbucks use upward appraisals to appraise management and 360 degree or
Multi-Rater-Feedback will enables more visible performance management and performance
related compensation strategy in Starbucks high commitment HRM.
2.7 Reduction of status differentials/harmonisation
This aspect highlights the value of the work force and treating them the way they wanted to
be treated. High commitment HRM sends a strong message to front line employees that they
are treated as same as the senior management and Starbucks reflects it by, harmonised
with same level of benefit access, share ownership, employment conditions, hours of work,
team working and flexibility. Another example is that, Starbucks do not capitalising job titles,
promoting equality and humility at work place.
3.1 Best Fit - Matching Model of Strategic HRM (Devanna et al, 1984)
The effectiveness of HRM theories depends on how closely they fit with the organisation, its
culture, external environment and mutual performance enhancements. Organisations defer
from one to another due to organisational life cycle stage (introduction, growth, maturity and
decline) and size (large organisations, small and medium organisations).
“Organisations are taking increasingly divergent forms but the key dimensions of size and
structure still constrain the people function. HRM is conducted in a variety of ways, partly
due to these constraints but also because of strategic decisions taken to meet organisational
goals” (Price, 2004, p.203).
Starbucks have to survive global competition as it strive rapid growth through market
development and diversification strategies. Starbucks need to re-assure that they are no
longer a small business or a family run business. The company’s corporate business
strategy encompasses its expansion mission, mainly from saturated western markets to
emerging markets around the globe.
Starbucks has a flat organisational structure, but the forces of multi-national cultures and
increased numbers of employees require a controlled HRM strategy. It does not mean a
sudden cropping of its benefits blend or redundant its high committed HRM activities.
15

OFFICIAL
MANAGING THE HUMAN RESOURCE
Starbucks has a culture embedded with high commitment HRM and the organisation
believes investment in employees, is the success factor.
Starbucks was awarded in the large companies’ category as a ‘Best Company to Work For’
by fortune and needs to sustain its reputation as a high committed organisation coping with
economic forces and political forces.
Barney (1991) argues that the HRM has to be aligned with the strategic direction and
strategic change and consists of 4 characteristics.
1. Value – Starbucks High Committed HRM add significance to the organisation’s
activities in the long term as it is adding value to immaterial human asset of the entity
2. Rarity – ‘Your benefits blend’ is unique to Starbucks and not commonly available in
the retail industry
3. Inimitability – Starbucks core-competence are hard for competitors to copy
4. Non-substitutability – The Human interaction in retail service providing industry
cannot be replaced by any other resource. A barrister cannot be replace by a
vending machine at Starbucks as the customer expects the Starbucks experience
3.2 Effective HRM Planning and advantages of Committed HRM Strategic
Implementation
“HRM changes its appearance as we move around its image. Each shift of stance reveals
another facet, a darker depth, a different contour. As a fluid entity of apparently multiple
16

OFFICIAL
MANAGING THE HUMAN RESOURCE
identities and forms, it is not surprising that every time we look at it, it is slightly different.
This is why, conceptually, HRMism appears to be a moving target, and why, empirically, it
has no fixed (fixable) forms”. (Keenoy, 1999, pp.14-15)
HRM is changing its shape size and contents with accordance to the suitability, acceptability
and feasibility of its operating environment. The factors influencing HRM can be internal
factors (organisations, corporate strategy) and external factors.
Strategic decisions should drive core competencies to deliver advantages to the company as
HRM is an important strategic element. The Harvard map addresses five strategic policy
areas.
HRM is another tool for organisational strategies which manages the decisions, behaviours,
influence, control and motivates the workforce. “Strategic HRM takes a long-term
perspective and is concerned with issues such as corporate culture and individual career
development as well as the availability of people with the right skills. It incorporates
redundancy and recruitment planning and is increasingly focused on the concept of the
flexible workforce. ” (Price, 2004, p.292)
Starbucks needs Implementing high committed strategic responses to the environmental
changes. Its’ purpose of look after employees is the broader aspect of contribution to wider
community (society). Starbucks preserved their promising identity for all stakeholders during
financial ups and downs.
17

OFFICIAL
MANAGING THE HUMAN RESOURCE
Identification of risks such as demand risk, innovation risk and inefficiency risk will enable
Starbucks to face challenges and implement control systems. To cater rapid expansion,
Starbucks need a challenging effort to ascertain the ability to hire employees who fits the
organisational values and culture. Starbucks need to acquire the Human skills while
integrating them to the company culture especially when hiring Expatriates.
3.3 Recommendations for a successful High Commitment HRM
No doubt, the fact behind Starbucks past success is high commitment HRM. Starbucks has
two strategic options to continue similar level of high commitment for increased number of
employees.
a) Enhanced employee benefits management
Available options are benefit redundancy or further finance employee benefits by increasing
product price. Referring to the Harvard Map either above strategic decisions will negatively
impact in long term. Therefore an alternative is required.
b) An alternative Business strategy to support high commitment HRM.
 Outsource non-core activities. (HR, Pay-roll, logistics)
 New technologies (Kiosks for the customer to place orders)
 Product variety and different types of products. Starbucks can produce a product for a
supermarket chain (ice-coffee)
 Further improve productivity levels amongst workforce. Instead of corporate performance
related bonuses, introduce an individual performance based bonus schemes.
 Avoid waste and use an advance inventory system (Just-In-Time Stock Control).
c) Six Dimensions of National cultures
As a multinational organisation it is not easily possible to develop high committed HRM
strategies to maintain a small company atmosphere in different national cultures. At present
there is an increasing trend of different religious, ethnic, linguistic and national groups raising
their voice for recognition, at some cases even leading to conflicts and wars. For an
expanding organisation, Starbucks required to interpret, analyse, gain experience to
conceptualise different societies. Professor Geert Hofstede (1973) has identified a four
dimensional cultures (six dimensions at present). Multi-national Starbucks needs to consider
National dimensions in its high commitment HRM.
18

OFFICIAL
MANAGING THE HUMAN RESOURCE
1. Power Distance (PDI)
2. Individualism versus Collectivism (IDV)
3. Masculinity versus Femininity (MAS)
4. Uncertainty Avoidance (UAI)
5. Long-Term Orientation (LTO) - fifth Dimension by Michael Bond (1991)
6. Indulgence versus Restraint (IVR) – sixth dimension by Michael Minkov (2010)
Above recommendations will ascertain Starbucks high commitment HRM and sustainable,
feasible and acceptable performance improvements and its success in the future.
------------------------------------------------------END-------------------------------------------------------
Bibliography
1. Price, A., 2004. Human Resource Management in a Business Context. Second Edition.
London, Thomson Learning.
19

OFFICIAL
MANAGING THE HUMAN RESOURCE
2. Redman, T. and Wilkinson, A., 2009. Contemporary Human Resource Management Text and
Cases. Third Edition. Essex, Pearson Education Limited.
3. Albrecht, M. H., 2001. International HRM; Managing Diversity in the workplace. Oxford,
Blackwell Publishers Ltd
4. Kovach, K.A., 1996. Strategic Human Resource Management. Lanham, Md. ; London,
University Press of America.
5. Pfeffer, J., 1998. The Human Equation: Building profits by putting people first. Boston,
Harvard Business School Press.
6. Bamberger, P. and Meshoulam, I., 2000. Human Resource Strategy: formulation,
implementation, and impact. California, Sage Publications Inc.
7. Wickramasinghe, W. 2005. HRM and Banking Industry. Colombo, Seewali Printers
8. Mullins, L. J., 2005. Management and organisational behaviour. Seventh Edition. Harlow,
Prentice Hall/Financial Times
9. Trice, H.M. and Beyer, J.M., 1993. The cultures of work organisations. New Jersey, Prentice
Hall.
10. Johnson, G., Scholes, K. & Whittington, R., 2011. Exploring Strategy text & cases. Ninth
Edition. Essex, Pearson Education Ltd
11. Marchington, M. and Wilkinson, A., 2005. Human resource management at work: people
management and development. Third Edition. London, CIPD
12. Armstrong, M. and Baron, A., 1998. Performance management: the new realities. London,
Institute of Personnel and Development
13. Noe, R.A., Hollenbeck, J.R., Gerhart, B., Wright, P.M., 2006. Human resource management,
gaining a competitive advantage. Sixth Edition. New York; London, The McGraw–Hill Irwin.
14. Torrington, D., Hall, L., Taylor, S., 2002. Human resource management. Fifth Edition. Harlow,
Financial Times/Prentice Hall
15. Barney, J.B., 1991. Firm Resources and Sustained Competitive Advantage. Journal of
Management, 17(1): 99–120.
20

OFFICIAL
MANAGING THE HUMAN RESOURCE
16. Arthur, J. B., 1994. Effects of resource systems on manufacturing performance and turnover.
Academy of Management Journal, 37: 670-687
17. Keenoy, T., 1999. HRM as Hologram: a polemic. Journal of Management Studies. 36(1):1-23
18. Maslow’s Hierarchy of needs [Online]
Available at: http://blogs.forrester.com/nigel_fenwick/10-03-12-secret_successful_social_
communities_4_social_needs
[Accessed on 22 December 2011]
19. Herzberg’s Two-factor Theory [Online]
Available at: http://mathehu.wordpress.com/2010/04/15/
[Accessed on 22 December 2011]
20. Dimensions of National culture [Online]
Available at: http://www.geerthofstede.nl/culture/dimensions-of-national-cultures.aspx
[Accessed on 24 December 2011]
21. Different Types of Flexible working [Online]
Available at: http://www.direct.gov.uk/en/Employment/Employees/Flexibleworking/DG_184872
[Accessed on 06th January 2012]
21