Operations Management Report: Starbucks, Greggs, and Global Strategy

This report provides a detailed analysis of Starbucks' operations management, focusing on key aspects such as the Four Vs framework (volume, variety, variation, and visibility) in comparison to Greggs. It examines comparative performance objectives, including speed, quality, flexibility, and cost, highlighting the strategic decisions and their impact on customer service. The report further delves into design analysis, covering customer service processes and store layout. Task B investigates Starbucks' global operations strategy, exploring macro-environmental factors influencing its expansion. It also examines key requirements, capabilities, and challenges within the supply chain, offering recommendations for operational improvements and concluding with insights into Starbucks' service excellence and overall operational effectiveness.

Operations
management and
Service excellence

Table of Contents
INTRODUCTION..........................................................................................................................3
TASK A..........................................................................................................................................4
Comparative Four Vs Analysis..................................................................................................4
Comparative Performance Objectives Analysis.........................................................................5
Design Analysis.........................................................................................................................7
TASK B..........................................................................................................................................8
Overview....................................................................................................................................8
Global operations strategy and Macro environment factors affecting Starbucks......................8
Key Requirements, capabilities and challenges.........................................................................9
Evaluation and Analysis of chosen operational area................................................................11
Recommendations....................................................................................................................12
CONCLUSION.............................................................................................................................14
REFERNCE..................................................................................................................................15

INTRODUCTION
Operations management refers to planning and monitoring processes in order to achieve
high profitability. It is basically converting labour as well as raw materials into products &
services effectively so that maximum profit can be achieved. In this current report, Starbucks a
coffee company or coffee house chain is chosen (Hugos, 2018). The company operates in more
than 80 countries and have 30,000 outlets worldwide. Starbucks was established by Gordon
Bowker, Zev Siegel in year 1971. in this report, Four vs analysis is going to discuss in relation
to two companies that is Starbucks & Greggs. In addition to this, analysis of objectives of
performance is discuss in this report. Later it covers, Design analysis that influence the layout
and design of services that is provided to their customers. Process of supply chain management
is very important to be followed by this company so that overall objectives can be achieved in
the given time frame.

TASK A
Comparative Four Vs Analysis
The main feature of this process is to convert each resource or raw material in a
productive output which is generally classified into four assorted attributes. It is said that every
business operation have common elements which they requires such as raw material, equipment,
money and in exchange it will be converted into the form of finished goods. These four
dimensions consist of visibility, volume, variety and variation. It has been said that the process
of developing and creating goods and services which are based fundamentally which helps them
in order to create values in an effective manner (Copacino, 2019). In the present context of
Starbucks & Greggs, a difference between both the organisation are going to be performed
which is mainly on the basis of four Vs.
Four Vs
Elements
Starbucks Greggs
Volume It refers to the first element where
major principle is to maintain the cost
low and volume high about the
production process. According to
this, if management team adopt this
element produce high volume of
goods and services, cost of
production will be reduced. In this
context, managers of Starbucks need
to focus on bulk manufacturing
which reduces the cost of production
process. It is the company mainly
deals in coffee.
On the other hand, in this context of
Greggs managers of the company
decides to increase their volume so
that they will be able to gain their
profitability at the marketplace.
Management team need to increase
their bulk production which
automatically helps them in order to
reduce their manufacturing cost.
Variety In the second element of this
dimension, it has been said that
managers need to raise their
dimension area so that they can beat
In case of Greggs, managers need to
increase the range of food items so
that they can attract large number of
customers. With the help of

the level of competition. In this case,
Starbucks innovate new and unique
food products which have different
types of variety so that large number
of customers will be attracted
towards the company. For example,
managers need to launch new flavour
coffee as well as food items
(Fahimnia, Sarkis and Davarzani, ,
2015).
producing new food bakery items,
company will be able to influence
ample number of individuals at the
marketplace.
Variation As per this element, managers need
to add variations in their goods and
services. In reference to Starbucks,
managers develop unique features in
their present goods offered by them.
This as a result, need innovation as
well as creativity within their present
goods and offerings.
The third dimension of 4 Vs says that
in order to influence large number of
customers, managers of Greggs need
to add some new flavour or element
in their current food items. This will
assist them in attracting large number
of new customers towards their
organisation.
Visibility It is the element in which customer
will be able to track the order placed
by them within stipulated time frame.
This is the method which needs to be
adopted by the management team of
Starbucks. For example if a customer
place their order through online
sources, they can easily identify the
current location of their product.
It refers to the last element where
customers will be able to easily
visible the products and services
offered by them. In this context,
Greggs have their physical stores
where they sell their food items to
the consumers in a traditional
method.

Comparative Performance Objectives Analysis
It has been said that there are various types of performance objectives which need to be
followed and adopted by the management team of both the organisation. Main focus of the
company is on their employees as they are the key resources of the company. Some of the most
essential performance objectives are as follows:
Speed: It is the element which is all about customer experience where how long
customer need to wait to buy their goods and services. It is very essential for the management
team to have strong internal communication so that they can organise and manage every
activity in an effective manner. In this context, Starbucks have low internal communication
whereas in context of Greggs managers have strong communication which increases the overall
profitability of the company at the competitive marketplace (Heizer, Renderand Munson, 2016).
Quality: In the present context of Starbucks, quality of the products and services offered
by them are high in quality which retain large number of customer towards their organisation.
On the other hand, in case of Greggs, managers provide bakery products which are high in
quality in order to retain large number of customers towards their business entity. Therefore, it is
very essential for the management team to maintain and increase their overall quality of the
products which is offered by them to customers. This as a result assist them in order to maintain
their position at the marketplace (Quarshie, Salmi and Leuschner, 2016).
Flexibility: It has been said that speed and flexibility are highly interrelated with each
other. Managers need to be flexible so that they can easily adopt changing environment so that
they can assist them in order to attain their goals and objectives in an effective manner. In the
present context of Starbucks, managers have flexible organisational structure with the help of
which they can accomplish their goals in an effective manner and within given time frame. On
the other hand, in case of Greggs, with the help of flexible working management team attain
goals and objectives of the company in an appropriate manner.
Cost: It has been analysed that the major cost of Starbucks associated with the purchase
of coffee beans. The cost of coffee beans are quite high which affects the overall profit margin
of the company at the competitive marketplace. Managers need to maintain their cost of
resources which need to be managed by them in an effective manner. On the other hand, in
context of Greggs cost is highly associated with the raw material required by the company in

order to produce bakery products. In order to maintain or reduce the cost of production,
managers need to focus on producing bulk products so that they can manage their overall cost.
With the help of all these elements, it has been concluded that managers of both the
company adopt these factors so that they can maintain the overall sustainability and reputation at
the competitive marketplace. This will assist them in attaining large number of advantages at the
marketplace so that they can easily perform their task and accomplish their goals in an
appropriate manner (Wieland, Handfield and Durach, 2016).
Design Analysis
 Impact on design of customer service process
Customer support refers to a range of customer services used to assist customers in order
to prepare them for correctly using the products and services. It consist of helping in the process
of planning, training, upgrading, maintenance and disposal of goods and services. Customer
service is a branch where an organisation deals in providing services to the customer before,
during and after purchasing goods and services. In the present context of Starbucks, it is
required by the management team of the company to provide after sales services to the
customers so that they can retain their potential customers for a long duration of time
(Fredendall and Hill, 2016). For example, it is the company which attain feedbacks and reviews
on a regular basis, so that they can perform their functions according to the requirements of
customer's. On the other hand, Greggs use this method so that they can develop positive impact
on the customers available at the marketplace. This positively affects the reputation of the
company which leads to increase the overall profitability & sales at the marketplace.
With the help of using feedbacks, reviews and response of customers, managers will be
able to produce services which assist them in order to retain their potential consumers for a
longer period of time.
 Impact on design of store layout and flow
It is required by each and every organisation to design their store in an attractive,
influencing and unique manner so that they can influence large number of customers towards
their company. Both physical as well as online stores help in attracting customers and
maintaining their reputation at the marketplace in an appropriate manner. If we talked about
Starbucks, company have their physical stores where they traditionally sell their products to
their customers. Apart from this, it has been said that company provide their goods and services

through online platform to large number of customers which assist them in order to attract huge
number of individuals towards their company. On the other hand in context of Greggs,
managers provide all the bakery products through physical and online platforms. With the help
of this, company gain various advantages at the marketplace which leads towards the overall
development and growth of the company (Zdeblick, PROTEUS DIGITAL HEALTH Inc,
2017).
TASK B
Overview
Supply chain management is a network of various activities which is related with
delivery of a service or product in which the company is dealing with. It is a function which is
related with coordination of various network lines, coordination of movement of products with
help of supplies from various suppliers to manufacturers and then to distributors (Heizer, Render
and Munson, , 2017). This is related to sourcing of materials, assembling chains, warehousing
facilities, entry of orders, distributing them and final delivering them to their customers. A
supply chain is a process which is having a sequence of organisational facilities, activities and
various functions which are involved in production & delivery of products which are of very
high quality and also at prices which are affordable & competitive at same time (Monczka,
Handfield, Giunipero and Patterson, 2015).
Global operations strategy and Macro environment factors affecting Starbucks
Global operation's strategy is related to a company which is willing to expand its
operation and functions at a international level. There are many benefits which a firm can get
when they are able to expand themselves from their own country to other countries across
borders. In 1995, as there was a saturation in UK markets, Starbucks started to expand its
business operations in overseas market (Luthra, Garg, and Haleem, , 2015). By year 2001 there
are around 150 stores of Starbucks and they are planning to expand it since then basic of high
success which they have achieved through these years. Expansion of a brand across borders is
not a very easy task as there are lot of macro environmental factors which affect a company in
case of Starbucks also this company faced some of macro environmental issues which lead to
this company getting affected in a positive and negatively some of factors are discussed below:

 Regional integration: This is one factor which is affecting Starbucks as there is a
current trends and various external factors which provide increase number of opportunity
to Starbucks which can help them in expanding themselves towards global markets. This
factor poses threats as business expansion is very difficult for Starbucks in those
countries which are at developing state.
 High economic growth: There is a very high economic growth which has been taking
place countries which are developing state which can lead to creation of more
opportunities for Starbucks (Christopher, 2016).
 Rising labour cost: There is a rise in overall labour cost in developing countries this
factor is a threat for Starbucks as this will lead to increase in spending of more financial
resource for extraction of ingredients.
 Increase in health consciousness: There is a trend which is taking place in most of
countries which is people are becoming more conscious and aware about what they are
consuming and ingredients present in that particular products which they are consuming.
 Technological improvements: There is a opportunity for Starbucks because of
technological improvements that they can improve their market reach because of mobile
application and link their services which can help them in generation of more revenues.
Above mentioned are some of factors which are affecting Starbucks in a negative or positive
manner, depending on way company is able to deal with such situations (Kamble and Rawal,
2016).
Key Requirements, capabilities and challenges
Key operation requirements:
There is a requirement that all functions are having required amount of coordination
which is required in supply chain management function. There are many requirements which
have to be compulsorily followed and adopted by a company in their overall process of supply
chain in Starbucks. Major requirement in Starbucks overall process of supply chain is mentioned
below:
1. A system approach which can help Starbucks in management of entire flow of materials,
information, services which is process of procurement of raw material from various
factories & warehouses and then finally delivering them to customers is very necessary
for maintenance of a effective supply chain process in a company.

2. Strategic coordination is a tool which has to be necessarily present in Starbucks which
can help them in having a integrated system of supply chain which is very essential for
maintain a balance between overall supply and demand in Starbucks. Effective process
of supply chain will help in competing successfully in the cut-throat competition which
is there in global markets.
Challenges:
1. Purchasing of green coffee beans: This is most important ingredient for Starbucks from
a various developing countries has started increasing risk because of political instability
in such countries (BEYAZIT, 2015).
2. Weather conditions: There are situations which are affected any changing weather
conditions such as political risk, weather condition and inconsistent quality. Though
Starbucks has to some extent has been able to lock their prices of green coffee bey
forming various long term contracts but then also it has suffered from lack of flow of
inventory to some extent.
3. Adverse conditions of market: There was a decision passed which was related to
increase in incremental cost on their customer rather than the replacement cost on
various gasoline stations which are present today which is because of oil prices which
are rising with high amount of uncertainty.
4. Instability in supply chain: If there is any instability in the overall supply chain then it
leads to immediate and very quick reaction from wall street which leads to profits of
company getting affected by the adverse conditions flourishing in market (Gonçalves,
and Correia, 2019).

Evaluation and Analysis of chosen operational area
Evaluation and Analysis of supply chain process:
It is very important for every company that they are able to have effectiveness in the
supply chain process. If evaluation is being done of the present supply chain process then it can
be said that Starbucks is managing their own process of supply chain.
Right inventory: It is very important that there is very high quality of coffee beans
which are used by Starbucks in their overall production of coffee. If a farmer is not bale to get a
good or required amount fir a particular type of coffee beans then it will impact the quality of
coffee beans as they will then not use required fertilizer which is necessary for producing good
quality of coffee beans. This leads to a requirement that Starbucks is making sure that they are
able to provide a good price to their farmers which can help them in maintaining of right amount
of quality in their coffee beans.
Supply chains are value chains: It is very important for Starbucks that they are able to
consider their supply chains as value chains. Main reason behind this view is that ultimate value
of product and service in this case is affected by purchasing of raw material, receiving it and
then warehousing them and further using it in overall process of manufacturing.
Integration of supply chain process: It is very necessary that Starbucks is able to
integrate their procedure of supply chain as a strategic coordination is required for every
business organisation. This is necessary that there has to be a proper balance between demand
and supply and this has very huge impact on the process of supply chain. If there is no
coordination then that has to be brought by the company by understanding what are various
lacking factors which is affecting the process of supply chain in a negative manner(Sabry,
2016).
Consideration of cost, quality and customer demand: there has to be a respective
standards which by Starbucks in their products which they are willing to maintain in their
products. If in any case that standards are not been able to followed then this leads to a situation
of dissatisfaction amongst their customer and this posses negative impact on overall market
image of Starbucks. This has been a major reason why Starbucks has to maintain effective
standards of quality control

Mishandling of activities in supply chain: There are many instances when the supply
chin network is affected by mishandling of various factors which has a negative impact on
procedure of supply chain such as control process which is related to quality maintenance,
management of their own supply chain procedure (Lucien Fobi, 2017).
Focus on core service: Purchasing of coffee beans has been a core activity in Starbucks
which they have to make sure that they are performing this part of their manufacturing and
production of good quality coffee. This is one process which must not be outsources in any case.
In effective maintenance of supply chain process it becomes very important that this part is
performed by Starbucks themselves.
Above mentioned are some of activities which have to be considerer by Starbucks with
respect to their overall procedure of Supply chain management. This will be having a offering of
high quality of coffee to customers (Adela, Vasilica and Dan, 2018). If the overall value
perceived by customers is very high then it will lead to increase in customer loyalty which is
very essential factor for maintain a required brand image in external market and also to have a
competitive edge in surviving for long term while maintaining high satisfaction of customers.
Recommendations
From above discussion there are various recommendations which are being made which
can be implemented by Starbucks so that they are able to improve their overall supply chain
management process and also at same time they are having adequate quality products which can
help them in maintaining satisfaction level of their customers
(Soeleman, , 2019).
 Following of series: In case of adequate maintenance of supply chain management
process it is important that the process which starts from procurement of raw material to
the final delivery of product to the consumer.
 There has to be increase in appeal to customer profiles which is very necessary for
increase in their sales they are having a target base of customer which are of category
cultured, technologically savvy, highly educated, art interested this will help Starbucks
in having a mass target of marketing which can help them in maintenance of their overall
brand image for a particular point of time.

 Start a new variant for those customers which are very health conscious this will help
them in satisfying and catering to needs of all category of customers and this will also
help in approaching a new segment of customers which will also be a competitive
advantage as other competitors have till now not stared any such product for such
segment of customers.
 Improvement of housekeeping service especially when there are lot of customers which
can affect their overall sales. Improvement and maintenance of performance standards in
case of overall supply chain process of Starbucks will lead to improvement in house
keeping especially during busy times.
 Adoption of Hybrid Layout: There is a necessity that there should be a mix of layout
which means that there should not be focus on only product layout or process layout but
both as product and process both aspects are very important to be taken care of by
Starbucks.

CONCLUSION
This report is based on various aspects which Companies use in their overall process of
operations management. There are many different aspects which affect their functioning such as
supply chain management, quality control methods, quality improvement techniques all such
have effect on how a particular organisation is handling their functions. Supply chain
management is a process which is present in every company and this is required to be carried on
with adequate effectiveness so that overall objectives can be achieved.

REFERNCE
Books & Journals
Soeleman, A., 2019. Align operations to cope with hostility: Managing Uncertainty and
Variability.
Adela, B., Vasilica, O.S. and Dan, P., 2018. Data Management for Photovoltaic Power Plants
Operation and Maintenance. Ovidius University Annals, Economic Sciences
Series, 18(1), pp.70-75.
Lucien Fobi, A., 2017. Improving efficiency and effectiveness of operations in humanitarian aid
logistics.
Sabry, H., 2016, November. Integrity Assurance of Critical Common Pipelines of Two ADNOC
OPCO's. A Success Story. In Abu Dhabi International Petroleum Exhibition &
Conference. Society of Petroleum Engineers.
Gonçalves, A. and Correia, A., 2019, June. Determination of Compatibility between Activities
according EU General Data Protection Regulation: An Initial Study. In 2019 14th
Iberian Conference on Information Systems and Technologies (CISTI)(pp. 1-7). IEEE.
BEYAZIT, Y., 2015. gamma (@ um “ttflsflntt.
Kamble, H.Y. and Rawal, A.N., 2016. EVALUATION OF CREDIT RISK MANAGEMNT
POLICIES AND PRACTICES IN COOPERATIVE BANKS.
Christopher, M., 2016. Logistics & supply chain management. Pearson UK.
Monczka, R.M., Handfield, R.B., Giunipero, L.C. and Patterson, J.L., 2015. Purchasing and
supply chain management. Cengage Learning.
Hugos, M.H., 2018. Essentials of supply chain management. John Wiley & Sons.
Copacino, W.C., 2019. Supply chain management: The basics and beyond. Routledge.
Fahimnia, B., Sarkis, J. and Davarzani, H., 2015. Green supply chain management: A review
and bibliometric analysis. International Journal of Production Economics, 162, pp.101-
114.
Heizer, J., Render, B. and Munson, C., 2017. Operations management. Sustainability and
Supply Chain Management, 12th Ed., USA.
Heizer, J., Render, B. and Munson, C., 2017. Operations management. Sustainability and
Supply Chain Management, 12th Ed., USA.
Fredendall, L.D. and Hill, E., 2016. Basics of supply chain management. CRC Press.
Quarshie, A.M., Salmi, A. and Leuschner, R., 2016. Sustainability and corporate social
responsibility in supply chains: The state of research in supply chain management and
business ethics journals. Journal of Purchasing and Supply Management, 22(2), pp.82-
97.
Wieland, A., Handfield, R.B. and Durach, C.F., 2016. Mapping the landscape of future research
themes in supply chain management. Journal of Business Logistics, 37(3), pp.205-212.
Luthra, S., Garg, D. and Haleem, A., 2015. Critical success factors of green supply chain
management for achieving sustainability in Indian automobile industry. Production
Planning & Control, 26(5), pp.339-362.
Zdeblick, M.J., PROTEUS DIGITAL HEALTH Inc, 2019. System for supply chain
management. U.S. Patent 10,305,544.