Leading Change: Comparative Analysis of Starbucks and Costa Coffee

This report delves into the critical aspects of leading change within organizations, using Starbucks and Costa Coffee as case studies. It begins by comparing the operational strategies of both companies, highlighting their approaches to adapting to market changes. The report examines the impact of internal and external drivers on leadership, individual performance, and team dynamics. Furthermore, it assesses the importance of minimizing the negative impacts of change within an organization. Barriers to change and their effects on leadership decision-making are also explored. The report then analyzes the application of suitable leadership styles in an organizational context, and concludes with a summary of key findings. The report references various academic sources to support its analysis of change management, leadership, and organizational strategy.

Understanding and
Leading change

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1. Comparison between different organisational operational strategies after adopting changes
.....................................................................................................................................................1
P2 Measurement of internal and external drivers of change on leadership, individual and team
.....................................................................................................................................................3
M1...............................................................................................................................................5
M2...............................................................................................................................................5
D1................................................................................................................................................6
P3 Evaluate how to minimize negative impact of change on organisation.................................6
TASK 2............................................................................................................................................7
P4 Barriers which effect the change and affect leadership decision making strategies..............7
M3...............................................................................................................................................8
D2................................................................................................................................................9
TASK 3............................................................................................................................................9
P5 Application of suitable leadership style in organisational context........................................9
M4.............................................................................................................................................11
D3..............................................................................................................................................11
CONCLUSION..............................................................................................................................13
REFERENCES..............................................................................................................................14

INTRODUCTION
In a business process, there are various tools and techniques which can be utilised to
make the process successful and making business capable of adopting changes within market
place environment. Adopting dynamic kind of nature also helps in providing gaining competitive
advantage. There are various changes which take place within marketplace due to change in
tastes and desires of marketplace (Fullan, 2014). Smooth and effective running is being ensured
when the company running get flexible in nature. In this report, company chosen is Costa and
Starbucks and they both are multinational firms that deal in providing coffee products across the
globe. There are various factors which are presented in this report like effect of changes within
structure and operations of an organisation and its policies. Apart from this, there are various
other sections which will be discussed like drivers who has direct impact on the team behaviour
and leaders for completing aims and objectives in better and effectual manner.
TASK 1
P1. Comparison between different organisational operational strategies after adopting changes
In marketplace, number of modifications which takes place within marketplace by the impact of
various factors like culture, tastes, technology and many other elements. These whole process
can be stated as changes in organisation. It is highly essential to adopt these kind of changes by
an organisation in order to acquire the best possible opportunities so that it can make the position
much better than earlier in future regarding staff members and making long term relationships
with customers. In global market, there are two companies which are mainly operating as retail
coffee products chain at multinational platform and they are large in scale and those are Costa
and Starbucks.
STARBUCKS
This company can be stated as one of the largest firms that has been dealing in coffee
products. First, Starbucks was launched in Seattle on 31st March, 1971 by they three friends who
were studying in College. This is a public limited company and it has around 27000 outlets that
are operating worldwide. Company has some main products like Coffee Beverages, smoothies,
tea, bakes goods and Sandwiches. As per the report of 2017, their turnover was noticed on 22.38
billion dollars. Their current employees are approx. 238,000.
COSTA
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Costa coffee is a British multinational company which is headquartered in Dunstable,
Bedfordshire and is subsidiary of Whitbread. This company was established in 1971 in London
England and there are approx. 3400 stores of this coffee company across the globe. The main
products of this company is Coffee, Tea, Sandwiches and Iced drinks. As per 2016, their
turnover which was noticed about 1.16 billion Euros.
There are number of policies and plans which are being made and has been adopted by
both companies but still, there are number of differences that are given as below:
Basis Starbucks Costa
Demand based
strategies
Criteria of company is to grab the
knowledge and analyse actual
needs and wants of customers and
thus, bringing changes according
to desires. There are various
changes which took place due to
implementation of Innovation and
categorised as per desires and
needs.
Costa Coffee has certain products like
Infusions and Smoothies which they
mainly deal in. There is huge and main
difference between Starbucks and
Costa Coffee and that is Costa does not
mainly look out for the taste of
customers and what does they actually
want (Aslan and Reigeluth, 2013). As
per the comparison, Costa coffee prices
are high in nature and thus it becomes
hard in nature ton maintain the budget
for having cup of coffee. The main
focus area of this company is
innovating in products and experiments
so that tastes of people can be explored
and changed.
Pricing strategies When company got high goodwill,
price of products increased and
this in turn affected the
productivity and profitability in a
negative manner because those
kind of prices was not being
There are number of cost strategies
which are being adopted by company
so that competitive advantage can be
gained. There has been addition done in
flavours and tastes in order to gain new
experience which can be given to
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accepted by consumers. Therefore,
after conducting deep market
research, they restructured pricing
strategies in order to uplift the
profit and production ratios.
coffee having people.
Promotions and
advertising tactics
There are various effective
marketing strategies which are
being adopted by company in
which huge amount of funds has
been invested so that benefits can
be acquired by advertising at the
initial stage.
These kinds of promotions and tactics
are not being adopted by this company
but due to dynamic nature of
marketplace, number of plans and
strategies have been adopted by Costa
and now, there main focus is on
promotional activities in order to gain
high share of market.
Process When company was at initial
stage, there was structure form in
which company performed its
operations but with time, required
modifications has been done in
order to reach at better position
(Thomas and et. al., 2013).
There are number of strategies and
tactics which are being followed and
among them most used is traditional
methods like presenting coffee on
tables. There are number of changes
which are being done in hospitality,
communication behaviour and
presentation as well.
P2 Measurement of internal and external drivers of change on leadership, individual and team
Leadership
This can be stated as process in which leadership is being conducted within group of
certain people in order to lead them for achievement of objectives. This is done by single person
who is called as leader. In order to become a leader , there are various abilities and skills are
required so that effective leading can be observed. According to the structure, there are number
of certain qualities which are required in order to obtain high level of performance. Certain time
needs to be allocated to each and every element specially while conducting process and
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operations along with manufacturing of products and services. Two major elements can be stated
as internal and external drivers of an organisation.
Internal drivers
Internal drivers of an organisation refers to various events, factors, people, systems, structure and
conditions within the organisation which are mainly under control of an organisation. Apart from
this, there are other elements which can state Internal drivers and they are described below:
 There are number of structures which are being stated as capital structure and goodwill
of an organisation and those are being included within marketplace.
 Number of factors like innovation and creativity plays crucial role in enhancing the
goodwill of firm in better and effective manner (Aslan and Reigeluth, 2013).
 It is highly important for a company to regulate and monitor effective and comfortable
environment within workplace so that modifications can be implemented in ease and
effective way.
External drivers
External drivers can be stated as those elements which mainly occurs outside the company so
that reasons which takes place within organisation are cause by external drivers which are not in
control of an organisation. Apart from this, there are various other elements which are being
described below:
 It can be said as most essential driver in which whole business process mainly depends
on growth factors of an organisation.
 There are various another elements which has direct affect on ratios company and which
is competitor present within marketplace .
 There are various number of things which are being stated as external drivers of changes
and there are investors, Govt. , technology and many others who can directly impact on
them.
Linkage of leadership with drivers of changes:
There are high chances for an individual to become a leader when certain skills and
abilities are being adopted by him\her (Different type of leadership styles, 2017). It is highly
essential for a leader to identify and analyse the nature of an organisation in order to implement
certain skills and abilities for required modifications.
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It is highly essential for a leader to determine and analyse the skills and capabilities and
thus number of effective plans and strategies are being in order to adopt the attain the target
market. This can result in providing number of benefits to the company.
Leadership goals and motive:
There are number of objectives in leadership in order to provide appropriate guidance for
attainment of certain aims and objectives. Below described are the objectives of a leadership
which needs to be adopted by an effective leader:
Direction: Effective guidelines are being provided so that attainment of aims and objectives of
firm can be obtained for various motives and thus chances of error can be reduced.
Control: For a leader it is essential to regulate and monitor so that performance level can be
enhanced of an organisation along with effective production (Doppelt, 2017).
Authority: To a leader, various number of roles and responsibilities which are being allocated to
him along with certain powers in order to extract effective and proper path can be provided to
team members.
Influence: Company working in marketplace has to face adverse kind of situations sometimes
and thus to overcome that, guidance is being needed so that leader can show his effective skills
and handle that particular situation . This whole factors can be done by the aid of various theories
for attainment of objectives.
M1
There are two factors which has direct impact on the activities of an organisation along
with other operations while manufacturing of products and services. Moreover, brief explanation
can be given by elaborating the culture of an organisation, staff members, management, Govt.
and competitors and many more who has crucial role to play in growth and success of an
organisation in effective and efficient manner (Fyke and Buzzanell, 2013). There are various
organisational changes which got affected by those two drivers and among those most important
is productivity and profitability.
M2
It is highly essential for a firm to adopt the concept of change management in order to
obtain the response which can be applied to environmental changes. In this kind of approach,
Kotter change model is being applied in order to upgrade the place in performance level of an
organisation. There are 8 steps which are being involved like from starting to create urgency and
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after that formulation of powerful coalition. After all this vision is being created and thus it being
communicated after then. Changes are being built after removing of barriers and thus
implementation is being done (Gupta, 2011).
D1
There are various plans and policies which are being formulated and to make them
effective in nature, it is required to determine them and thus analyse them with deep research in
order to recognise the areas where modification can be applied within company (Hrebiniak,
2013). In order to make employees much more effective, training and development sessions can
be provided so that they can skills and abilities to deal with outside environment.
P3 Evaluate how to minimize negative impact of change on organisation
There is presence of risk factor within elements of change and all this in turn will have
direct impact on culture and structure of an organisation. Appointment of department is being
done who has main focus on solving out the risk factors which are involved in business process.
There are various kinds of methods which are applied and thus those implementation is being
done and they can have negative impacts and those are described below:
Employee resistance: This kind of approach can be stated as an universal truth that whenever the
company adopt some changes, their certain structure also get directly affected. While conduction
of process, mostly traditional process is being utilised by an organisation. In simple words, when
an employee who resist to adopt the modifications make the company cripple. Resistance is an
inevitable response for any major changes (Keppel and et. al., 2012). Illustration can be
expressed that by actualizing the man-made brainpower in directing records and information of
assembling process which may occur in specific components in capturing of framework.
Expenses: With time, it becomes necessary for company to make some changes which are
required and in order to make them successful in nature, innovation is being needed so that it can
be applied for the Starbucks. It becomes easy for a large scale company to arrange the funds
from the investors but for a small scale it becomes difficult to arrange as they face many types of
obstacles while applying those changes. Effective planning needs to be done in finance sector so
that high costing in operations and process can be reduced (Mukherjee and et. al., 2012). There
are number of factors which can be determined and thus managers and leaders can analyse them
therefore selecting the best one for meeting requirements. Expenses are the most essential
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element for an organisation and thus it is required to have proper database of it so that in future it
can save time and money for company.
Lack of Support and failure: A company faces various kind of situations which mainly arises due
to miscommunication and lack of exchange of essential data. This can be stated as main cause
behind those certain modifications in nature and environment of staff members and an
organisation. It is highly needed to have support of managers and leaders to lower division and
thus higher authority should provide effective guidelines so that work of leaders and managers
can get easy and thus aims and objectives of firm can be attained (Parsons and Cornett, 2011).
There are some certain tactics which needs to be learn by employees so that level of performance
can be improved for certain tasks and objectives along with certain changes which also will take
place within an organisation.
Morale: There are various elements which are being considered as nature of human like
confidence level, skills and abilities for achieving the goals and objectives of company within
given period of time. Morale is an essential factor which is required for every kind of employee
in order to give high level of performance. There are some situations which arises while that
employee feel low in confidence and his morale level gets very low while working in a company.
This in turn can directly put impacts on the productivity and profitability ratios of the company.
Certain modifications are available and they needs to be implemented within firm and that too in
favourable situations (Suchman, Sluyter and Williamson, 2011). Establishment of effective
communication needs to be done by management of company so that dynamic changes which
can be adopted within marketplace.
TASK 2
P4 Barriers which effect the change and affect leadership decision making strategies
It is important for leaders and managers to keep on making plans, strategies and
executing them in a proper manner so that favourable conditions may come across for
organisation. A leader is the one who think beyond the limits. At the time of decision making
process they can take support of subordinates as well this will help them in making even more
appropriate decisions for upcoming future. Costa coffee and Starbucks have so many factors
which may affect the decision making process. Most of the companies have different department
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which mainly analyse the marketplace and take decisions after analysing by looking at every
aspect.
Therefore, Starbucks and costa also uses same kind of departments which helps leaders at
the time of decision making. They look at every single point which may cause organisation
losses . Member of this department look at the risk factors, market conditions and look
competitors that what exactly they are providing services and collects the data. Than they plan
accordingly. Like, try to modify its products so that sale can get increases, use new technologies
which rivals are not using and etcetera. Leaders can also form different sorts of team that brings
up different solutions and cases that may help at the time of decision making. Also, management
keeps on changing in every organisation from time to time. These things mainly put impact on
production, manufacturing, finance and etcetera. These impact can be both positive or negative.
Unnecessary changes may arise conflict situations for the companies (van der Voet, Kuipers and
Groeneveld, 2015). Hence, at the time of decision making it is essential for leaders to keep an
eye on every single factor.
Change management is stated to be a kind of management which brings positive changes
in the organisation. In today's world, market rapidly changes like, new tools and technologies
comes up. In this context, leaders and managers are the one who bring changes that are necessary
for the organisation. This aid in running business properly without any fail. After bringing new
technology tools it is their duty to make employees familiar with the changes. Here, training and
development programmes takes place which gives knowledge to staff members and by that it can
enhance both productivity and profitability of these companies. These changes takes time in
setting with the environment. But once they gets set it pulls favourable conditions for firms.
These steps can make changes at workplace. But, it also lead organisations to increase
their expenses. Results of these decisions comes in front in the future. Controlling and
monitoring is another process which takes place after setting a plan regarding the desired goals.
Leaders should keep on monitoring the situations if the plan is going in a proper way or not. It is
important for leaders to keep on motivating its subordinates so that targets can attain in an
efficient time frame (Yoder-Wise, 2014). It is not necessary that every decision brings positive
changes in Starbucks and costa. Failures of these decisions may increase put companies to a
loose position in the marketplace. Here, A motivated leader is the one who can bring up the
company back to the market. Failure is a part of way to success. Leaders should make changes in
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the organisation or for the company after having word with the subordinates this may help them
in making decisions which are effective and efficient.
M3
There are various obstacles which mainly occurs when leadership process is being
performed for various changes and other modifications. The main cause behind barriers are low
discipline and self confident, poor communication, high cost, impulsiveness and many others.
There are various factors which have potential to directly affect the profit ratios and production
of firm and that too in negative manner (Field and Barros, 2014). This in turn creates difficulties
for employees to give high level of performance for the company. It can be further explained by
an example that communication funnels needs to be effective in nature so that vital information
can be shared and kept as confidential so that it can be further used in future decision-making
process.
D2
With a specific end goal to decide the execution phase of staff individuals, minimisation
is being finished by constrain field thinking so real aptitudes and capacities can be resolved for
specific changes (Goetsch and Davis, 2014). Preparing is being given to workers keeping in
mind the end goal to enhance their aptitudes and abilities with the goal that errands and exercises
can be executed in smooth way.
TASK 3
P5 Application of suitable leadership style in organisational context
As per the business nature, there are various types of leadership theories which are being
implemented. There are various tools and techniques which are being applied by Starbucks with
effective styles of leadership as it is basically a coffee shop industry so that it can lead to
effective management along with achieving aims and objectives of firm in better and effective
manner. There are some leadership styles which are being offered within organisation depending
upon the necessary tasks to complete and departmental needs. Those leadership styles are given
below:
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(Source: Leadership Styles, 2017)
 Laissez Faire: In this kind of factor, leader lacks direct supervision of his team members
and thus mainly fails to give effective feedbacks under his own supervision. This kind of
approach is being mainly used by high level trained and experienced employees who just
needs little guidance. This can be helpful in this kind of leadership. But in turn this can
hamper the productivity of employees and thus in turn can also affect features of
employees (Norman and Verganti, 2014). It mainly produces no kind of leadership or
supervision efforts from managers which can lead to poor production, lack of control and
cost of improvement.
 Autocratic: This kind of leadership style allows manager and leaders to make effective
decision-making process and that too alone without input of others. Total authority is
being possessed by the managers and thus impose their will on staff members. Usually
decisions of autocratic leaders are not being challenged. For example Country like North
Korea operates under autocratic leadership. Main benefits are being grabbed by
employees.
 Participative: This kind of leadership is also called democratic leadership style
participative administration esteems the contribution of colleagues and companions,
however the obligation of settling on an official choice rests with the participative
pioneer (Agostino, Arena and Arnaboldi, 2013). This kind of leadership mainly boosts up
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Illustration 1: Leadership Styles,
2017