Operations Management and Service Excellence at Starbucks: A Report

This report provides a detailed analysis of Starbucks' operations management and service excellence. It begins with an introduction to operations management, then delves into a Four Vs analysis, evaluating volume, variety, variation, and visibility within Starbucks. The report examines the company's performance objectives, assessing how they are measured and attained, and compares them to those of competitor Greggs. Furthermore, the report analyzes the design of Starbucks' cafes and their impact on the customer experience. Part B of the report explores planning and control, a macro-environmental analysis, challenges faced by Starbucks, and planning and control of resources, culminating in strategic recommendations for improvement. The report emphasizes the importance of customer satisfaction, innovative technology, and cost-effective production techniques in achieving operational efficiency and business growth.

OPERATIONS
MANAGEMGENT
AND SERVICE
EXCELLENCE

Table of Contents
INTRODUCTION...........................................................................................................................3
1. Four Vs Analysis of Starbucks................................................................................................3
2. Performance Objectives Analysis of Starbucks......................................................................4
3. Design Analysis of Starbucks.................................................................................................6
PART B............................................................................................................................................7
1. Planning and Control...............................................................................................................7
2. Starbucks Macro Environment Analysis.................................................................................8
3. Challenges of Starbucks..........................................................................................................9
4. Analysis and evaluation of Planning and control of Resources............................................10
5. Recommendations.................................................................................................................11
CONCLUSION..............................................................................................................................12
REFERENCES..............................................................................................................................13

INTRODUCTION
Operation is the basic function of any business organization and it has to be very effective
in increasing the growth of the organization as it will help to establish the business organization
in the market to attract more customers. The operation are carried out with employees which are
also the human resources of the organization. Employees also need to increase their efficiency by
increasing the knowledge and skills which are required to achieve the organizational objectives
they also have to maintain the quality of the products and services which the organization have to
offer to the customers. In this report there is a brief study about Operation management of
Starbucks and its services as Starbucks is an American company which is delivering coffee to
the customers with various varieties. The company was established in 1971 in Washington, US
and also have more than 290000 employees inn the company to service the customers and
increase the operations of the company. The company also have an annual revenue of 24.7
billion dollars and it has a mission to achieve the satisfaction of the customers. In this report
Starbucks have to examine the competitors' analysis so that they can increase the operation in
the market and increase the efficiency of the company.
1. Four Vs Analysis of Starbucks
Starbucks have adopted this analysis to determine the factors which can help the
company to increase the efficiency and increase the market share be decreasing the threat of
competitors.
Volume
In this the company have to evaluate the quantity of products to produce them so that it
can satisfy the demand of the customer and also provide satisfaction of them. The company have
to adopt the high level production of their products which will help the company to decrease the
cost and increase the demand by improving the prices of their products and attracting more
customers to the company. Starbucks also have to increase the quantity of their production as it
will help to meet the daily requirements and increase the efficiency of the company to satisfy the
customers needs as it will help the company to become loyal and increase the market share of the
company. Coffee brand and other machines are made for the bulk so that it can reduce the cost of
the company and decrease the cost of production to reduce the prices.
Variety

Starbucks also have to determine the different types of coffee and other products which
by evaluating the tastes, preferences of the customers as it will help to attract more customers all
of different segments. The company also have to identify the types of nee of the customers to that
they van produce the products which can increase the satisfaction level of the customers and
become more effective for the company to grow in the market. (Wirtz and Lovelock, 2016)
Variation
The company also have to determine the probability of the change on the demand of the
customers which can affect the growth of the company and also the demand of the company will
be affected. The company have to increase the evaluation to identify all the environmental
changes and the external business environmental changes which will impact the efficiency of the
operations of Starbucks.
Visibility
The company also need to ensure that the products are properly reached to the customers and the
brand is visible to the market which will help the company to attract more customers and
increase the efficiency of the company. The marketing strategies will also help the company t
develop the effectiveness in the market and also help the company to attract more customer by
providing them better [products which are visible to them. The company also have to increase the
location where the cafe can be easily accessible and increase the sales of the company. The
company can also ensure that the products can be visible to the customers at the time of delivery
and all the stages of delivery can be seen by the customers which will increase the satisfaction
level of the customers and help the company to achieve competitive advantage. Customer
satisfaction services with high focus towards bringing innovation, quick delivery of products to
bring high profitability and functional efficiency will visibly enhance its goodwill and reach
global benchmarks effectively. Gregs is British bakery company serving bakery items and
delicious snacks with high quality parameters widely known for its best management ethics and
also functioning with new working scenarios. The company is aiming to work ahead within
serving consumers on larger parameters., keen scenarios worked on among major goals under
which new operational aspects can be worked on.

2. Performance Objectives Analysis of Starbucks
Starbucks have to analyze this factors which will help to increase the performance by
estimating the quality of operations of the employees in the company which will integrate all the
efforts to push them to achieve the objectives of the company and increase the growth of the
company. The company also have to compare the performance in the market to ensure the
efficiency of the company and also increase the productivity of their operations in the company.
Greggs is also the competitors of Starbucks and also need to be analyzed on the same to
determine all the strength's weakness of the two company which will help Starbucks to grow
effectively. Greggs Company being one of the strong competitors providing innovative business
services to customers with efficient services, impactful services with high focus towards
positively bringing new handy coffee drinks.
Specific
Performance objectives of the Starbucks have to specific in nature and it should have the
effective knowledge about the resources which are currently available and it should also help the
employees of the company to understand the vision of the company so that they an easily attain
the objectives and create an effective organizational culture which will help to increase the
productivity of the company. Whereas Gregg's have to analyze the effective ways in which the
customers can increase their satisfaction and increase the sales of the Bakery chain. The
company also have to formulate the specific mission which can be effective to the behavior of

the demand of Bakery products and it can also help the employees of the company to increase
their knowledge in that field to increase their performance.
Measurable
The company have to decide the system why which the performance can be measured and
increased the quality of the products and services as the Starbucks have adopted the star rating
system which will ensure the quality and satisfaction of the customers on the basis of the stars
where one star is poor and 5 star is excellent in terms of quality and satisfaction level. Where as
Gregg's bakery have adopted numerical rating system in which the scale of 1 to 10 is used to
identify the satisfaction of the customers. Starbucks also implemented the questionnaire and
feedback forms which increased the knowledge of the company to increase the satisfaction of the
customers and remove the obstacles within the internal structure of the company.
Attainable
Starbucks have to analyze the liability of the objectives of the company as it can be
attained the objectives with the available resources and maintain the quality of the coffee and all
other products in the company. Starbucks also have to analyze that the resource which are
available should be utilized optimally to increase the rate to achieve the objectives this will
increase the performance of the company increase the market share of the company to increase
the profitability in the market. Gregg's bakery have analyzed that the need and demand of bakery
product is growing so the company also increased the cost efficiency of the raw material and also
increase the value of the resources to increase the performance of the objectives to increase te
growth of the company and increase the sales of the company. The company also helped the
customers to maintain the quality of their standard of living by providing low cost food which
was hygienic and healthy.(Wirtz and Zeithaml, 2018)
Relevant
Starbucks have to analyze that the objectives which are set are relevant to the nature of
the company and also are efficiency in integrating with the company so that they can also help
the company to maintain the quality of the company and increase the performance of the
company. Starbucks also have to analyze all the customers which are having preferences of
coffee and target the specific market to ensure the regulation of the objectives. Gregg's bakery
have to analyze the relevancy of the food products which are their Uniqueness and also maintain
the taste of their products to increase the performance of the company. The performance of the

company will only be increased if the employees of the company are very well skilled and
knowledgeable to achieve the objectives.
Time Bound
The objectives of the company also have been time limited to increase the efficiency as
thew company as they believe more pressure will increase the efficiency of the employees and
also they will push their boundaries to increase the quality of the products. Gregg's bakery have
the ideology that the employees should work coordinated in a systematic manner by which they
will able to increase their efficiency and manage their time to decrease the chances of stress.
The 5 PO principles applied to operations can be understood as major impact scenario
which further brings on major determinants worked on among management, to upgrade sales and
consumer focused services which have been majorly known for major work goals. Operations of
management under Starbucks company is known for best working aspects and new scenarios
under which working profits can be analyzed within various quests goals.
The student has shown no clear understanding of the 5 PO principles as applied to operations.
3. Design Analysis of Starbucks
Starbucks is also known as the most beautiful coffee places in the world as the company have the
efficiency to design the cafe in such a way which increase the ambiance f the cafe and increases
the satisfaction of their cafe they also have to maintain the beautiful views so that they can also
increase the sales of the company. (Suarez, Calvo-Mora and Roldán, 2016) As the design
analysis help the company to increase the goodwill and brand image of the company to I crease
the quality of the products and services the company offers to the customers. Starbucks also have
to analyze the design of every aspect which will help the company to be more vibrant for the
customer as the company also have to display itself to attract maximum customers. The
company also have to decide the interiors and brand logo design which will be more effective in
making the efficient design of the company. The design of the company helped the company a
lot o promote and influence the customers to attract to the cafe as the quality standard and the
pricing of the company increase the self-esteem to be the part of the company and it creates the
social uplifting the customers who visit the Starbucks cafe. The customers who are going the
Starbucks cafe are also treated as the upper and higher class people as they are ready to spend
more to their satisfy their demand and increase the quality of their standard of living. (Reid, and
Sanders, 2019)

Operational Performance Objectives:
Starbucks operations are based towards efficient performance and objectives being largely
focused towards integration of new working patterns, innovative technology usage to serve
customers dynamically. The operations are highly focused towards bringing cost effective
production techniques in all departments which will enable optimum resource utilization on
varied functional arenas. Operations in Starbucks are highly focused towards keenly reaching the
set global benchmarks of brand among consumers, leveraging best resources and outlets to
technically uplift its standards.
Starbucks Gregg's bakery
Customer Service process The company have increased
the mobile utility with the help
of mobile application as all the
customers are able to register
any complaint on the mobile
application and also order their
coffee as well. They also
provide the customized the
coffee according to the tastes
and preferences of the
customers.
The company have developed
the food which can be
delivered as take always and it
does not decrease the quality
of the food in the packaging.
The coffee also helped the
company to increased its sales.
(Psomas and Jaca, 2016)
Store layout The coffee cafe of the
company have the heritage
history and mixture of
traditional and modern
concepts of architecture. The
company also have good
ambiance in their sitting
arrangement which provide
better quality of comfort and
The layout of the stores have
been differentiated with the
food stores as it will help to
create the bakery environment.
The location of the store is also
made prime to attract the
customers. The layout also
included the artisan styling
which increase the efficiency

satisfaction. of the customers to visit the
store more frequently.
PART B
1. Planning and Control
Planning Is the process of forecasting the uncertain future outcomes which are market
with the available resources to increase the efficiency of the business organization. Planning is
the first stage of managing the operations of the organization and also need to gather all the
factors which will also help the organization to make an effective functional operations so that
they can create a vision and mission as it will also help the organization to create the foundation
of the nature of the business organization which the business will do all the other activities to
increase the growth of the company. Controlling is the last stage of the management operations
which help the organization to maintain the planning operations and create a systematic culture
in the organization as without controlling planning is of no use and vice versa. (Mahadevan,
2015) Planning objectives are strongly important for Starbucks in establishing high end targets
completion within specific time frame for gathering strong goodwill, productivity and strong
working ethics within all departments.
Impact on performance: Planning and control functions are highly fundamental for Starbucks to
focus towards for reaching strong working efficiency, timely production targets and serving
customers with strong delivery of products along with diverse business extension.
The design analysis is widely also known for gaining functional objectives, keenly known
for gaining stronger working aspects which has bee fundamentally known for various scenarios
under management. The 5vs analysis is correlated under this where we can analyze that there are
major working aspects under which new goals among company paradigms are framed on for
enhancing new scope segments within consumers market reach.
2. Starbucks Macro Environment Analysis
Starbucks have to increase the managerial operation so that the company can perform the
effective planning and controlling of the options strategies and it will also help the company to
increase the productivity to maintain the efficiency to lead in the market as the company also
have more than 30000 stores all over world and it is very essential for the company to ensure the
proper planning and controlling of their stores to increase the performance and achieve the
competitive advantage In the market which will also help the company to increase the

profitability and develop innovative ideas to promote the growth of the company. All the factors
of the external environment have analyzed by the company as Starbucks is always expanding its
business in the new market and that also need to decrease the threat of failure so this analysis will
help the company to formulate the effective strategies to increase the efficiency I the market and
achieve the objectives if the company. (Liker and Ross, 2017)
Starbucks operational strategy can be understood by the fact that strategic planning is highly
involved in the deployment of resources, implementing effective usage of all resources through
which capital investments can result in high outputs. Impact of planning, controlling on these
operational factors is highly relevant and their role will bring strong positive impact on
profitability as well as goals attainment.
Political Factors
Starbucks have to analyze the political stability of the new market in order to ensure the
efficiency of the market all the laws and policies formed by the government have to be identifies
in this factor. The company also have to analyze the employment laws and regulations in the
market to ensure the ethical operation in the market. (Kerzner, 2018)
Economical Factors
The company also have to determine the economic factors In the market to ensure the
financial stability and also increase the profitability from the market. The company have to
ensure the employment rates and unemployment rates, inflation rates, Gross Domestic product of
the nation, tax rates which are applicable on the company's products and services. As the
company is also dealing in the global operations they also need to evaluate the foreign exchange
rates and import and export rates of the country to make the effective pricing strategies and
increase the efficiency of the company.
Social Factors
Starbucks is focused on the customers' satisfaction so that company have identified the
customer behavioral pattern in order to increase the quality of their coffee to meet the demand of
the customers. In this factor the preference, tastes, values, morale, ethics, culture, beliefs are
evaluated to increase the efficiency of the products and make them according to the demand of
the market this will also help the company to segment all the customers to develop the product
differentiation so that they can target them and increase the sales of the company.
Technological Factors

The company also need to analyze the technology to In the market and the competitors to
ensure the competitive advantage as latest technology reduces the cost of operations and also
increase the efficiency to attract the customer more effectively.(Jaca and Psomas, 2015)
Planning and control also posses strong focus for gaining stronger place within working
competitiveness for gaining new positions as per external factors where brand aims to function
with maximum functional efficiency.
3. Challenges of Starbucks
Strengths
 the company is financially very strong and also have a very effective strategy to increase
the efficiency to invest in the market to gain the maximum returns.
 It is the fastest growing company and is also worth more than a billion which is much
more than their competitors which give an advantage to the company to increase the sales
and discourage the new entrant to compete in the same market.
 Starbucks is the largest chain of coffee house in the world which also gave the company a
strong advantage of economies of scales and decrease the cost of operations of the
company.
 The panning and controlling of the company also provide better outcome o to the new
market and also help to survive in the existing markets.
Effective planning and controlling business functions work as an important fundamental
requirements for enabling change in overall structure with the detailed analysis on the
set global brand benchmarks. Starbucks strongly focuses towards integrating strong
management functions with relative focus towards planning, controlling as it is strongly
required for positioning itself as competitive brand ( Bataglin, Viana, and Bulhões,
2020. Starbucks also have an effective managerial employee which help to increase the
efficiency of the company so that they van improve the quality of the outcome and
provide the better vision to the company. (Gómez, Martínez Costa and Martínez Lorente,
2017)
Weaknesses

 The have a weakness is hat the company is totally based on the coffee beans and if the
price of the coffee beans is increased it will also impact the profit margins of the
company.
 Planning can controlling of the company will be ineffective if there is any factors which
is changing with he control of the business and it will also decrease the efficiency of the
company.
 The company is also to having all the product other than coffee which decrease the
customers to go for it as there are many competitors which provide food and coffee at the
same place. Starbucks plan to achieve the addressed weaknesses with strong strategic planning,
innovative technologies and impactful services among consumers by dynamically serving
them as per their preferences. High promotional business services are strongly important
to bring leverage of high profitability goals and completion if targets .
Opportunities
 Planning and controlling of the marketing strategies which will help the company to
provide the efficiency to increase the quality of the products and innovate the technology
will also decrease the cost of the company.(Fernandes and et.al., 2017) The agricultural aspects of the company of the coffee beans can also ensure the quality of
beans and also decrease the uncertainty of the fluctuation from the suppliers. There are
business opportunities for company to expand in untapped countries market and also
govern special focus onto new arenas for leveraging major work aspects competively.
Threats
 Starbucks have the threats of new entry in the market which are more innovating and it
can attract the customers of the Starbucks which will decrease the market share of the
company.
 The company also have to expand its business to growing economies to increase the
efficiency and increasing the panning and control of the strategies. Starbucks faces
competition from external sources of business industry where various new companies
and startups are coming up among various paradigms.

Planning and control requirements are widely important for gaining new functional working
aspects, leverage working innovation among employees performance goals and to enhance new
working aspects which will keenly bring on major factors of working effectiveness.
4. Analysis and evaluation of Planning and control of Resources
Starbucks also have to evaluate the effective methods and theories which are very
effective in planing and controlling the operations in the company and it also helps the company
to provide a better performance criteria. (Escrig and de Menezes, 2015) The self actualization
needs are the focus of the company and the design analysis help to evaluate the best ways to
attract the customers which are willing to spend on themselves to increase their satisfaction. As
the Gregg's is also located very close to the Starbucks cafe it will also help the Starbucks to
increase the sales as the company have the quality of products and best ambiance and both the
chains have different stores which will not compete each other. Motivational theory is highly
important to motivate employees in company for delivering services to customers as per the set
benchmarks as there needs to be strong development along with focus towards gaining strong
workforce commitment from them
Resource allocation
Starbucks have to plan that all the resources which are available in the company are
allocated at the right place so that it can increase the efficiency of then company and provide a
better quality of management. A proper planning of all the resources will help to allocate all the
resources effectively in the organization.
Resource Scheduling
In this the managers of the company have to evaluate the total resources required and
what are the resources available. This will also ensure that the required resources is mad
available in the same time and this will also help the company to increase the efficiency of the
company by increasing the resources which are required for in the specific time so that the
company can reach the objectives effectively. (Campbell, Reyes-Picknell and Kim, 2015)
Resources Leveling and Smoothing
In this stage the Resources of the company will be processed in such a way that all the
resources which are planned within the time period will also increase the quality of the
operations and provide better results. Starbucks have to make sure that the resources which are

available are equally utilized in all the operations so that it can increase the efficiency of the
operations.
Resource Forecasting
It is the planning of the resources which rare to be used a=or required by the company in
the future to continue the operations and also increase the expansion of the company. The
resource forecasting help the company to analyses the cost of production which is to be done and
also it helps to evaluate the pricing strategies of the current period which will help the company
in future to increase the resources in the company. (Campbell, Jardine and McGlynn, 2016)
Planning and controlling are interrelated with performance parameters as it enables company to
serve new strengths and working aspects among employees, where new goals and aspects are
widely worked on by analysing new domains.
5. Recommendations
Starbucks need to analyze all the factors which will help to increase the sales of the
company they also need to promote the quality and consistency in such a way that all the
customer do not forget. This will all be done with the help of effective planning and the company
also have to provide better customer satisfaction also that the company can increase the sales.
The plannings and controlling will help the company to grow rapidly as it evolves overall
functioning efficiency and infrastructure of brand leveraging them strong determinants through
which they can reach the set production standards. Training employees and strategic planning
along with strategic controlling of delivery within services will enable Starbucks to be effective
in all its business activities . The company have to ensure the efficiency of the employees and
also motivate their employees to get training and increase the knowledge and skills of them so
that they can help the company to achieve the efficiency and maintain the quality of the
company. The Coffee is the most consumable product in the hot beverages and the employees
also need to find an innovative way to convey this information to the customer in such a way that
it will help them to decide more openly, and they will be more effective in becoming the loyal
customers of company. Starbucks also need to increase the promotional campaigns and provide
free sample taste of their coffee to the pope so that they can ensure the taste of quality and
provide discounts to the existing customer to retain them in the company as customer satisfaction
is very essential In the company to achieve the competitive advantage and also increase the
profitability of the company. (Calabrese and Corbò, 2015)

CONCLUSION
This Report had a detailed discussion about Operation management of Starbucks in
Comparison with Gregg's bakery as it had developed the products and also launched a new
coffee in their store which had now become the competitors of the company. Starbucks also have
to analyses then internal and external environment to increase the knowledge ad provide a better
vision to the company. Report concludes importance of planning and controlling on company
performance, various issues which management needs to overcome with strategic planning and
also focus towards bringing long term implementation. The management of the company also
need to be much effective in managing the resource which will help to increase the quality and
productivity of the company (Missbauer and Uzsoy, 2020).

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