Sustainability and Business Environment

This document discusses the impact of sustainability on the business environment, focusing on Starbucks. It includes SWOT and PESTLE analysis, corporate social responsibility goals, different leadership styles, and the importance of organizational culture.

Sustainability and
Business environment

Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
SWOT analysis for Starbucks................................................................................................3
PESTLE analysis of Starbucks...............................................................................................4
Influence on Corporate Social Responsibility goals..............................................................5
Different styles of leadership..................................................................................................7
Importance of organisational culture on the processes at Starbucks......................................8
Reflection report.....................................................................................................................9
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11
REFERENCES..............................................................................................................................12

INTRODUCTION
Business environment is It is defined as all the internal as well as external factors which
impact how an organisation function including management, customers, employees, business
regulations and many more. In addition to this, it is the surrounding in which an organisation
process and function as well . It is analysed that business environment assist business entity to
gain an understanding about factors that impact on their performance level (Gandhi, 2017). It is
significant for an organisation to develop strategies by doing external and internal analysis in an
effective manner. For the present report, Starbucks is taken into consideration, which. It is an
American company andthat offers food and beverage to the customers globally. Theise company
was wasis established by Jerry Baldwin, Gordon Bowker and Zev Siegl in year 1971 and . The
headquartered of Starbucks is located in Seattle, Washington. and Aat present, it operates a large
chain of coffee shops in offer services in more than 15 countries. The report will cover SWOT &
PESTLE analysis of Starbucks to analyse the factors that force this firm to make changes in
business operations, for running sustainably. In addition to this, significance of corporate social
responsibility in context to respective organisation is discussed with its CSR goals. Moreover,
different leadership styles were are elaborated with and importance of organisational culture is
explained in relation to Starbucks.to implement changes in business.
MAIN BODY
SWOT analysis for Starbucks
It SWOT analysis is defined as a tool and strategic technique that is adopted by a business
entity as it helps in gaining insight about strength and weaknesses of company. In addition to
this, it also a ssists organisation to know the opportunities and threats due to which an effective
strategy were developed in order to make improvement. The SWOT analysis of chosen
organisation is discuss below:
Strengths
 One of the major strength of company is its strong and high financial performance that
help in gaining best spot for offering food and beverages at marketplace.
 Another strength of Starbucks is its quality and on time service by employees, which help
in developing effective brand image within the market.

 The company has high presence in market as it offers services in more than 15 countries
that impact positively on productivity and profitability of the organisation.
Weaknesses
 It is analysed that company is based on key inputs which is coffee beans that decline the
level of profit and revenue of Starbucks (Hillary, 2017).
 In addition to this, cost of goods involve within the premium to middle class if market
segment which makes its product above the budget of working customers and because of
thus, they prefer to take services from McDonald’s and other outlets that offer coffee.
Opportunities
 The company has the opportunity to increase its operations by entering into other market
as it helps company to strengthen its market performance and earn higher profits as well.
 In addition to this, Starbucks is a renowned brand and have loyal customers as well.
Therefore, it has the opportunity to enlarge the number offerings that attract more number
of customers and also assist in attaining competitive advantage at marketplace.
Threats
 One of the threat of Starbucks is increase in cost of its key element that is coffee as it
declines the profit margin and revenue of company.
 The company at present is facing issue because of global supply chain that leads to
disruption within the supply chain.
PESTLE analysis of Starbucks
It is considered as a tool which iIs used by business entity in order to analyse the macro
environmental factors, which hasthat highly influence on productivity and performance of an
organisation. It is significant for the company to conduct external analysis as it helps in
developing effective strategies and implementation of operations in a proper manner. The higher
authorities of Starbucks make used of PESTLE framework in order to identify macro
environment factors, which are as follows:
Political factor
This factor consists of political stability, political conditions, trade, taxes and so on.
herein, the political element which respective organisation faces is associated with the sourcing
of raw materials. In addition to this, the higher authorities of Starbuckf Sainsbury’s is highly
required to adhere all the rules as well as legislation of countries from where it take raw

materials. Due to Brexit the political conditions of country is decline that directly has influence
on productivity and performance of respective organisation.
Economical factor
The economic factors which can be impact on Starbucks were interest rates, inflation
rate, import laws, exchange rates and so on. It is analysed that the main economic factor that
impact respective organisation is ongoing recession which dented profitability of many
organisations. In addition to this, nowadays customers are shifted more towards the consumption
of coffee that impact positively on demand and profit of Starbucks. It is analysed that Because of
COVID-19, inflation rate is decline which results as reduce in buying power of people. This
impact negatively on sales and profit level of Starbucks.
Social factor
The company provide quality that attract large number of people and impact on its
performance within the society. On the other hand, it is not able to give its products and services
according to the budget of low as well as middle tiers working people that impact negatively on
its customer base level. For this, it is important for company to also focus on offering products
that is afford by low and middle class tiers as it will help in raising performance and profitability
in an effective manner.
Technological factor
This factor plays an important role in providing on time service to customers prevailing at
marketplace. Starbucks make use of innovative and new technology in order to provide service
that directly leads to improvement at café (Saura, Palos-Sanchez, and Correia, 2019). Along with
this, it also assist in offering service frequently that gain loyalty of customer in an effective
manner. Starbucks also tie up with Apple with a motive to introduce application related to
discount coupons. Moreover, the preference of customers has changed with the change in
technology therefore, it is significant for Starbucks to make use of such technology in order to
offer something new in market and attract large number of customer. In addition to this, it occur
high cost to company that decline the revenue level of company.
Legal factor
It is significant for an organisation to follow all the laws and legislations in order to carry
out activities in a systematic and smooth manner. In relation to Starbucks, its higher authorities
ensure that all the legislation of countries from which it source raw materials must be followed.

In addition to this, the government also assure that company is using appropriate as well as
ethical goods in order to produce product and service as well. Moreover, company using coffee
beans direct from the farmers which is effective for an individual and environment as well. There
is change in policies of government because of Brexit and following all such rules is significant
in order to execute activities without any interruptions and delays as well.
Environmental factor
Now the taste and preferences of customers are changed as they prefer to consume those
products as well as services that protect the environment. With reference to Starbucks, it make
use of bio-degradable materials, fuel efficient equipment’s, gas emission and so on. in addition to
this, using of bio-degradable materials decline the use of plastic and impact positively on the
environment. This assist company to develop positive mind set of customer and strengthen its
brand image as well. Furthermore, it is determined that after COVID-19, people are more
concerned of their health and also ensure that they eat healthy and consume those products which
safeguards the environment. For this, it is important for higher authorities of Starbucks to bring
new product that is natural and herbal as it will help in raising customer base level and
profitability ratio in an effective manner.
From the above discussion, it is said that the present condition of country impact
negatively on the performance and productivity of company. It is significant for respective
organisation to follow all the rules and guidelines for implementing activities systematically and
effectively. In addition to this, development of products by considering present mind set of
people towards their health and environment help company to attract people and maintain its
performance level within the market.
Influence on Corporate Social Responsibility goals
It Corporate social responsibilitySR is defined is as an activity that is performed and
function out by an organisation for welfare and improvement of societies. It helps company to
develop a positive brand image and enhance its reputation at marketplace by making investment
for welfare of vulnerable societies. It is analysed that CSR mainly involves three pillars that is

community, environment and ethical sourcing as well. for?. The ways by which CSR activities is
implement by Starbucks is given below:
There are various community stores of company that is associated with not for profit
organisation. The main objectives of developing such stores and partnership is to fulfil
requirements as well as demand of communities. It is stated that Starbucks mainly contributes
15% of transaction to non-profit partner so that improvement take place within the societies and
communities as well (Clinton and Whisnant, 2019). In addition to this, the higher authorities of
Starbucks also give opportunity of training to youths living within the communities. Starbucks
has established a foundation with a motive to increase strength of community centric initiatives.
In context to the second pillar that is ethical sourcing, which is showcased by the way
company purchase products. Starbucks ensure that quality of products as well as services is
given to its customers. It makes use of authentic ingredients in order to make coffee, cocoa, tea
and other products as well. It directly takes essential ingredient that is coffee directly from the
farmers in order to make their living standard stable directly. Moreover, Starbucks produce
goods by considering all the standard of ethical treatment in an effective manner.
With reference to Starbucks, there are various corporate social responsibility activities
implement by respective organisation in an effective manner such as conducting education
campaign, health campaign, contributing part of profit for welfare of communities and societies,
make use of recyclable product and so on. It help company to uplift the living standard of people
and make improvements within the society that has positive influence on brand image of
Starbucks. The company has partnership with Planet that ensures all the business operations does
not harm the environment. In order to do business and functions in a socially responsible
manner, the company build stores that are LEED certified. Furthermore, the company make use
of products and is recyclable and decline the sue of plastic as well. It is determined that
respective organisation make use of effective strategies which help in dealing with climate
change at global level. The higher authorities of company put efforts in order to handle as well as
manage environmental friendly operations and activities (Fernandes, 2017).
Starbucks emphasis on fulfilling the requirements of people in order to bring positive
change within the communities. As per the statistics, 90% of customers build positive image of
an organisation if the company giving its contribution for the welfare of societies. It is analysed
that report which is published by company named as “Global responsibility report”. It give

information and data that show Starbucks operations and activities towards the communities and
societies as well (Hamilton and Webster, 2018).
From the above discussion, it has been evaluated that Starbucks is a renowned
organisation that has high presence in market because of its high quality and service offering to
customer. In addition to this, the company make use of product that is recyclable and also ensure
less use of plastic as well. Starbucks also contribute a particular part of profit for development of
communities and societies which develop positive brand image in mind of customers and market
as well. Moreover, the higher authorities of company is decided to add new products in its
offerings that is good for their health (Németh and Németh, 2018). The products is herbal and
natural that will help in raising customer base level and also assist in maintaining performance in
such diverse environment.
Different styles of leadership
Leadership is the process of managing as well as handling different people performing
within the organisation. In addition to this, it is the way of providing instruction to staff members
in order to attain objectives within given time period. In context to Starbucks, there are many
leaders who manage and control activities performed by employees at its workplaceof the
company. It is significant for leaders to manage all the activities and motivate staff members to
implement it properly and effectively so that organisational objectives is are attained on time
period. Adoption of an appropriate form of leadership style will help company to influence
employees to accept changes and maintain their performance level in the diverse environment.
There are various leadership styles that is used within Starbucks, which are as follows:
 Autocratic leadership – It is defined as a style of leadership wherein leaders given
instruction to the staff members in order to effectively perform in an organisation. In
addition to this, the concept of autocratic leadership assists staff members to work within
a diversified place. On the other side, disadvantage of such leadership style is that leaders
take decision at their own level, without suggesting employees & worker as well. This
impact negatively in mind of customer and decline their level of creativity and products
which in turn leads to reduce in performance level of both employee and organisation as
well.
 Servant leadership – This leadership style is adopted when a business entity give service
at marketplace. The main objective of such organisations is to give quality and best

service to its customers. This leadership style was proposed by Robert K Greenleaf in
year 1970. In relation to Starbucks, it is a good and beverage company and its leaders
using servant style of leadership (Escaleras and Chiang, 2017). The main motive of
applying such style is to meet with the requirements of customers. It is analysed that such
leadership style help company to give quality service due to which brand image is
enhanced in an effective manner. Moreover, servant style of leadership gives benefits to
individuals in spending time and resources in an appropriate manner.
 Democratic leadership – It is considered as the most effective leadership style in order
to motivate staff members towards attainment of desired goals. Democratic leadership
style allows employees to give their opinions and suggestions at the time of decision
making. This make Starbucks employees feel valued and important at workplace which
motivate them to put their high efforts in achieving objectives within stipulated time
period.
 Howard Schultz leadership – This leadership style is basically a mixture of democratic
and transformational style of leadership. It is analysed that using such style give freedom
to employees in order to decide effective and appropriate strategy for implementation of
activities and functions as well. In addition to this, such style of leadership inspires as
well as motivate employees to work with full potential that has positive impact on
productivity and profitability of the organisation.
From the above study, it is determined that Howard Schultz leadership style is feasible
and beneficial for Starbucks in order to deal with the changing environment. In addition
to this, it help company to retain employees in such time period and maintain their
performance level. It also motivate staff members to give their full potential in such time
that has positive influence on performance and productivity of respective organisation.
Importance of organisational culture on the processes at Starbucks
Organisational culture is defined as the collection of values, norms, beliefs, practices and
expectations that guide actions of all the employees. It involves the behaviour as well as values
that directly contributes towards the psychological and social environment of the business.
Organisational culture plays an important role in order to motivate employees and retain them for
longer time period. It is analysed that providing positive working culture to employees enhance
the level of efficiency and performance as well (Chasdi, 2017). In addition to this, it also help

company to make employees flexible and accept the changes that take place because of change
in environment. The performance of companies is decline because of COVID-19, so it is
important for respective organisation to provide positive working culture to employees so that
they remain with company and help in dealing with such changes in an effective manner. It is
significant for managers to align organisational culture with the vision and objectives of
organisation. This Such goals and thinking way derived staff members to perform well and
remain loyal with the company. It develops high morale of employees and maintain the
absenteeism and including retention rate of a business entity. In relation to Starbucks, it is
renowned for its quality and high customer experience. Culture of company requires its
employees to be trained and knowledgeable as well. It is determined that higher authorities of
Starbucks has gone with alterations in the culture of organisation. The organisational culture of
organisation is distinct character which create competitive advantage and also enhance the level
of loyal consumers that leads to increase in profitability or financial performance of company..
In relation to this, corporate strategic management issues lies in better implementation of
culture in franchisees and licenses human resource as business partners have own approach
associated with organisational culture and human resource development. It is analysed that in
Starbucks, culture values needs of customer that is achieve with the positive behaviour of
employees. The company focuses on developing effective and positive culture so that employee
takes interest functioning of activities effectively. In addition to this, the company developed
environment of non-discrimination so that employees feel valued to working with company.
Another significance of organisational culture is it brings out the creativity of employees due to
which an entity is able to offer some innovation at marketplace. This help company to attract
large number of customers and enhance its performance level in an effective manner. The top
level authorities of Starbucks promised to uplift the culture wherein equality and diversity is
valued and respected as well. Moreover, the culture of company is better renowned for its
recycling and commitment towards declining waste & shrink environmental footprints (Bruijl,
2018). Furthermore, it treats employees as their partners and family members and focus on
fulfilling their requirements on time period. This help company to develop positive mind set of
employees and strengthen its market reputation effectively.

Reflection report
By conducting the study on Starbucks, it is determined by me that respective organization
has effective and strong leadership style that assist in handling as well as managing operations in
an effective manner. It is significant to focus on working with the leadership style adopt by
leaders as it assists in implementing activities in an effective manner. After the study conducted
by me, it is analyzed by me that adoption of Howards Schultz style of leadership admires all the
staff members and also give the effective care as well. It is determined by me that offering
benefits and perks did not enhance satisfaction level of staff members, offering non-monetary
benefits will satisfy them and for this Starbucks provide insurance, healthcare benefits and so on.
This assist company to motivate its staff members and maintain good relationship with them that
impact on their performance and efficiency level. It is important for company to provide training
session to its staff members so that they are clear with the activities need to be implemented in
order to perform job in an effective manner. Moreover, it is observed by me that productivity an
performance of Starbucks is decline due to COVID-19 as purchasing power of people is
declined. In addition to this, the company is going to bring new product in market which is
natural and good for the health of people that is the key point in mind set of people because OF
COVID-19. This will help company to maintain its performance level and attract large number
of people in an effective manner.
It is analyzed by me that Schultz style of leadership is also followed by the leaders of
Starbucks that assist in designing and developing activities effectively. Moreover, it is observed
by me that such leadership style assists in systematic implementation of overall functions that
directly leads to improvement in performance of organization. The vision and mission of
Starbucks is associated with managing staff members effectively so that demands of customers is
are satisfied that develops positive image in mind of customers towards brand. Along with this,
organization is involved in partnering with various companies and entities that assist in meeting
with requirements and wants of customer. The company also focuses on bringing innovation as it
believes that innovation is the factor that help in gaining growth and success at marketplace. It
also assists in satisfying requirements that is change with the market trends (Akhtar and Sushil,
2018). The company believes that it has two pillars that help company to enhance its market
performance that is employees & customers as well. At the time of conducting research about
Starbucks, it is determined by me that it follows differentiation strategy in order to enhance

customer satisfaction. Furthermore, the company conduct CSR activities for welfare of societies
and communities that has positive influence on its brand image as well as reputation. In the last,
it is observed by me that providing a positive working culture to employees which motivate them
to work with full potential in order to achieve objectives within given time period.
CONCLUSION
From the above study, it is concluded that business environment helps in gaining
understanding about the external and internal factors that has impact on productivity as well as
performance of an organisation. In addition to this,To respond towards changes in market and
other factors, applying SWOT and Pestle analysis is a tool that assist in identify strength and
weaknesses due to whichhelp companies in developing effective strategies were developed in
order to make improvements in a proper manner. Moreover, it is concluded that PESTLE
analysis allow an entity to gain knowledge about environmental factors that affect on its
performance. It is significant for an organisation to develop an effective CSR activities in order
to welfare societies and communities which in turn leads to development brand image at
marketplace. . In the last, it has been concluded thatFurthermore, it is important significant for a
businessbusiness entity to focus on maintaining the culture of organisation positive and healthy
that will help in raising performance and efficiencyas it increase the efficiency and performance
of employees which in turn that leads to increaseraise in profitability as well asand revenue level
of the companyan organisation.

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