Organisational Structures in Starbucks Coffee

Running head: PRINCIPLES OF MANAGEMENT
Principles of Management
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PRINCIPLES OF MANAGEMENT
Contents
Introduction...........................................................................................................................................2
Organisational structures......................................................................................................................2
Evaluation of Geographic structure.......................................................................................................4
Evaluation of Matrix structure...............................................................................................................6
Evaluation of Product structure.............................................................................................................8
Conclusion...........................................................................................................................................10
References...........................................................................................................................................11
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PRINCIPLES OF MANAGEMENT
Introduction
An organisational structure is an illustration that specifies the manner business activities are
directed in an organisation to attain a defined goal and purpose and these activities mostly
consist of roles, responsibilities and regulations within a firm. Also the organisational
structure determines the manner information and line of command flows between different
levels of hierarchy in a firm so as to ensure clarity and transparency of decisions at different
levels. In this report the different types of organisational structures has been discussed with
specific focus on Starbucks Coffee which is renowned across the world for their high quality
of roasted coffee beans and high passion for coffee products. Starbucks offers their customers
unique and fulfilling experience more than just coffee and provides a premium selection of
tea, coffee beans, fine pastries and other delectable items to satisfy taste buds of consumers.
Each of Starbucks store offers warmth, artistry and appeals customers with music and
ambience where people can sit, relax and chat or even work. Starbucks is highly committed
to offer highest standard of quality in coffee throughout the world and engage their
consumers and community with responsible business practices and approaches. Starbucks
has strong organisational structure that promotes their business activities to ensure global
dominance in coffee industry and their structure impacts all their areas of business including
management, leadership, communication, strategic change and implementation as well as
other elements of business to ensure exceptional success by meeting business needs.
Starbucks has four types of organisational structures that involves intersections among
different elements of their business. For instance Starbucks product structure intersect with
the functional and geographic divisions which in turn intersect with other sections of the
business. The main elements of Starbucks organisational structure includes functional
structure, geographic divisions, product based division and matrix based structures.
Organisational structures
According to Shahabadi & Pourkiani (2014) the organisational structure specifies the manner
in which a firm distributes their line of authority, accountability and arrange the
responsibilities for people and their jobs so as to maintain clarity of work, performance and
objectives to be attained. The organisational structure determines the possibility for
acceptable behaviour of employees in a firm in alignment to their responsibility and reporting
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PRINCIPLES OF MANAGEMENT
systems and even illustrates the firm’s relationship with their external environment to
demonstrate their arrangement of group of jobs and pattern through organisational chart. The
organisational structure of a firm depicts both reporting and operational process and
relationships and its components or building blocks consist of department or division,
hierarchy of management, process, regulations and objectives and specific temporary
building blocks like task force or committee. These organisational structures shape and
support in implementation of primary goals to promote their attainment in an effective way
and hence presence of appropriate organisational structure helps to identify and address
human and business realities so as to determine long term success. Hence organisational
structure effectively guides the behaviour of employees and teams so as to maximise their
productivity, efficiency, flexibility and motivation to attain pre-established goals. A strong
organisational structure is build on key elements such as work specialisation which means a
firm’ is divided into separate subdivision of jobs and their specialisation. The other element is
departmentalisation where firm is divided into basis of job divisions (Lee, Kozlenkova &
Palmatier 2015). Further organisational structure is grouped on basis of line of command
which illustrates line of reporting and on basis of span of control which specifies the way a
manager can effectively direct a group or individual. The other element of appropriate
organisational structure is determining whether the firm would follow centralisation or de-
centralisation to empower authority of decision and formalisation which ensures degree of
rules and regulations to be directed to staffs and managers of firm. An example of
organisational structure followed at Starbucks is given below:
Functional structure: in this structure a firm is grouped according to purpose and it allows the
division of firm based on specified function or area that empowers a specialist personnel to
direct authority, line of command and control within specified and defined scope of authority
(Syed, Azhar & Shahid 2013). For example a firm can practise functional structure and
divide responsibilities, line of command into functions like Sales & Marketing, Finance,
Engineering or Production etc where each function is headed by specialist Vice President
who are controlled by a Group President. Under each specialist VP like HR there exist
functional managers who are empowered to take decisions and give instructions to other
employees in their specified division so as to enforce control and command. Like managers
under HR function are authorised to enforce advice or decision in context to safety and labour
rights, relations.
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