BPP MSc Management: An Analysis of Starbucks Operations (Spring 2020)
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This report, submitted by a student for an MSc Management module, provides a detailed analysis of Starbucks' operations. It begins with a comparative study of Starbucks and Greggs using the Four Vs framework (Volume, Variety, Variation, and Visibility), examining how these factors influence their operational strategies. The report then delves into the performance objectives of both companies, highlighting their differing priorities and approaches. Furthermore, it analyzes the design aspects of both Starbucks and Greggs, including customer service processes and store layouts. Part B of the report focuses specifically on Starbucks, offering an overview of its global operations strategy, the surrounding macro-environment, key requirements, capabilities, and challenges. It also includes an analysis and evaluation of a chosen operational area and concludes with recommendations for improvement.

Programme MSc Management with Streams
Module name Operation Management
Schedule Term Spring 2020
Student Reference Number (SRN) BP0230934
Report/Assignment Title An Analysis Of The Operations Of Starbucks
Date of Submission
(Please attach the confirmation of
any extension received)
23th September/2020
Declaration of Original Work:
I hereby declare that I have read and understood BPP’s regulations on plagiarism and that this is my
original work, researched, undertaken, completed and submitted in accordance with the requirements
of BPP School of Business and Technology.
The word count, excluding contents table, bibliography and appendices, is words. 3450.
Student Reference Number: BP0230934 Date: 23/09/2020
1
Module name Operation Management
Schedule Term Spring 2020
Student Reference Number (SRN) BP0230934
Report/Assignment Title An Analysis Of The Operations Of Starbucks
Date of Submission
(Please attach the confirmation of
any extension received)
23th September/2020
Declaration of Original Work:
I hereby declare that I have read and understood BPP’s regulations on plagiarism and that this is my
original work, researched, undertaken, completed and submitted in accordance with the requirements
of BPP School of Business and Technology.
The word count, excluding contents table, bibliography and appendices, is words. 3450.
Student Reference Number: BP0230934 Date: 23/09/2020
1
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MSc Management with Stream
Operation Management
Spring Term 2020
Student Number : BP0230934
Submission Date : 23th , September 2020
Submission mode: Turnitin
2
Operation Management
Spring Term 2020
Student Number : BP0230934
Submission Date : 23th , September 2020
Submission mode: Turnitin
2

TABLE OF CONTENTS
PAG
E
Part A- Comparing the Operations of Starbucks to that of Greggs
1. Four Vs analysis of Starbucks and Greggs................................................................................................4-7
Volume
Variety
Variation
Visibility
2. Performance Objectives Analysis of both the companies....................................................................8-10
3. Design Analysis.....................................................................................................................................11-12
Starbucks Design Analysis
9Gregg’s Design Analysis
Part B-The Operations of Starbucks
Overview........................................................................................................................................................13
Starbucks global operations strategy and surrounding macro-environment........................................13-15
Key requirements, capabilities and challenges.......................................................................................15-16
Analysis and evaluation of chosen operational area..............................................................................16-17
Recommendations....................................................................................................................................17-18
Conclusion......................................................................................................................................................19
3
PAG
E
Part A- Comparing the Operations of Starbucks to that of Greggs
1. Four Vs analysis of Starbucks and Greggs................................................................................................4-7
Volume
Variety
Variation
Visibility
2. Performance Objectives Analysis of both the companies....................................................................8-10
3. Design Analysis.....................................................................................................................................11-12
Starbucks Design Analysis
9Gregg’s Design Analysis
Part B-The Operations of Starbucks
Overview........................................................................................................................................................13
Starbucks global operations strategy and surrounding macro-environment........................................13-15
Key requirements, capabilities and challenges.......................................................................................15-16
Analysis and evaluation of chosen operational area..............................................................................16-17
Recommendations....................................................................................................................................17-18
Conclusion......................................................................................................................................................19
3
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References................................................................................................................................................20-21
Part A
SECTION 1: FOUR Vs. ANALYSIS OF STARBUCKS AND GREGGS
Most modes of operation have a single factor in common; they always take and turn their 'input'
into products (goods and services) such as resources, information, energy, equipment and time.
They do this in different ways, and the 4 major aspects are called four Vs., Volume, Variety,
Variation and Visibility. Ultimately, the accurate combination of these four features will decide
how best to design an organisational process for optimal performance. Usually, based on these
four considerations, trade-off decisions would need to be taken with regard to operations
management. In this section, I discuss the comparative study of the Starbucks and Gregg’s four-
Vs. service. This is shown in below:
4
Part A
SECTION 1: FOUR Vs. ANALYSIS OF STARBUCKS AND GREGGS
Most modes of operation have a single factor in common; they always take and turn their 'input'
into products (goods and services) such as resources, information, energy, equipment and time.
They do this in different ways, and the 4 major aspects are called four Vs., Volume, Variety,
Variation and Visibility. Ultimately, the accurate combination of these four features will decide
how best to design an organisational process for optimal performance. Usually, based on these
four considerations, trade-off decisions would need to be taken with regard to operations
management. In this section, I discuss the comparative study of the Starbucks and Gregg’s four-
Vs. service. This is shown in below:
4
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4 Vs. Diagram
Volume:
Businesses formulate their practices based on their amount of production and revenue. In this
respect, the structure of the operation changes at the activity stage. Therefore, it is claimed that
companies with low volume sales or production have adjustable and dynamic operating practices
and high-volume companies go for mass customization and static operating processes (Parisio,
Rikos and Glielmo 2016).
Starbucks versus Greggs
5
Volume:
Businesses formulate their practices based on their amount of production and revenue. In this
respect, the structure of the operation changes at the activity stage. Therefore, it is claimed that
companies with low volume sales or production have adjustable and dynamic operating practices
and high-volume companies go for mass customization and static operating processes (Parisio,
Rikos and Glielmo 2016).
Starbucks versus Greggs
5

Compared to Greggs, Starbucks has a comparatively higher sale ratio based on price. The
Starbucks has a big brand name is the reason behind it. This high selling ratio also impacts their
operation. Compared with Greggs, Starbucks has a very rigid menu and sells fewer items. They
have a low revenue ratio, which is why they have provided a range of food on their menu. When
a restaurant has a high volume of sales, the menu appears to be more rigid and organised.
Otherwise, there would be a general stock-out scenario.
Variety:
Variety aspect means how much variety in a single product can be given by the business.
Introducing various sizes and shapes of a single product, for example. Companies that have
variety in their goods and services tend to some degree to have flexible operations, the process is
always complicated, and the unit cost is high (Parisio, Rikos and Glielmo 2016).
Starbucks versus Greggs
Starbucks does have a variation of coffee, just like Greggs did, they also provide a wide range. In
their operating processes, Starbucks has standardization, their food offering is very routine-
based, and thus they have easy operation and low-cost operation. On the other side, due to low
volumes, Greggs has a versatile activity where they sell a range of foods. Their product offering
can be said to be highly flexible but has a high unit cost.
Variation:
6
Starbucks has a big brand name is the reason behind it. This high selling ratio also impacts their
operation. Compared with Greggs, Starbucks has a very rigid menu and sells fewer items. They
have a low revenue ratio, which is why they have provided a range of food on their menu. When
a restaurant has a high volume of sales, the menu appears to be more rigid and organised.
Otherwise, there would be a general stock-out scenario.
Variety:
Variety aspect means how much variety in a single product can be given by the business.
Introducing various sizes and shapes of a single product, for example. Companies that have
variety in their goods and services tend to some degree to have flexible operations, the process is
always complicated, and the unit cost is high (Parisio, Rikos and Glielmo 2016).
Starbucks versus Greggs
Starbucks does have a variation of coffee, just like Greggs did, they also provide a wide range. In
their operating processes, Starbucks has standardization, their food offering is very routine-
based, and thus they have easy operation and low-cost operation. On the other side, due to low
volumes, Greggs has a versatile activity where they sell a range of foods. Their product offering
can be said to be highly flexible but has a high unit cost.
Variation:
6
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Due to certain external influences, such as changes in consumer taste and other monetary factors,
variation relates to or is correlated with changes in demand over a given period. For a business,
however, the variation is very difficult to predict (Gino, Coffman and Huizinga, 2019).
Starbucks versus Greggs
The company diversifies its product portfolio based on the past of Starbuck and food supply, but
still, the changes are not so important. Without bringing any change, they give distinct food from
decades. However, on the other hand, Greggs has launched new products and even discontinued
different products. Because of this, it can be assumed that Starbuck has a reliable operating
pattern that can be seen and felt from observation.
Visibility:
Visibility indicates how certain events influence the client and the resulting experience. In this
respect, highly visible organizations strive to make processes more seamless and error-free.
Routine and error-free activity (Ichinose et al, 2018) should be based on it.
Starbucks against Greggs
Starbucks, relative to Greggs, has a clearer process and visibility based on the above-mentioned
description. Coffee making and even packing is done in front of the client. Therefore, their
actions have a profound effect on consumer behavior and, through it, help to shape a favorable
view. Greggs, on the other hand, has a high range and flexibility option because of which the
process is not very visible from the customer end. Visibility at Greggs can be said to be quite
limited.
7
variation relates to or is correlated with changes in demand over a given period. For a business,
however, the variation is very difficult to predict (Gino, Coffman and Huizinga, 2019).
Starbucks versus Greggs
The company diversifies its product portfolio based on the past of Starbuck and food supply, but
still, the changes are not so important. Without bringing any change, they give distinct food from
decades. However, on the other hand, Greggs has launched new products and even discontinued
different products. Because of this, it can be assumed that Starbuck has a reliable operating
pattern that can be seen and felt from observation.
Visibility:
Visibility indicates how certain events influence the client and the resulting experience. In this
respect, highly visible organizations strive to make processes more seamless and error-free.
Routine and error-free activity (Ichinose et al, 2018) should be based on it.
Starbucks against Greggs
Starbucks, relative to Greggs, has a clearer process and visibility based on the above-mentioned
description. Coffee making and even packing is done in front of the client. Therefore, their
actions have a profound effect on consumer behavior and, through it, help to shape a favorable
view. Greggs, on the other hand, has a high range and flexibility option because of which the
process is not very visible from the customer end. Visibility at Greggs can be said to be quite
limited.
7
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Volume Variety Variation Visibility
Section 2: Performance Objectives Analysis
On the basis of the 4V Analysis, the operating strategy of Starbucks and Greggs differ
completely. Starbucks have high volumes, low variety, low visibility and low variation, while
Greggs have low volumes, high variability and high visibility. Their success goals and focus
areas are also totally different.
Starbucks
Performance Map
8
Section 2: Performance Objectives Analysis
On the basis of the 4V Analysis, the operating strategy of Starbucks and Greggs differ
completely. Starbucks have high volumes, low variety, low visibility and low variation, while
Greggs have low volumes, high variability and high visibility. Their success goals and focus
areas are also totally different.
Starbucks
Performance Map
8

Starbucks has a cost target in operation on the basis of the polar diagram. This is why
standardisation and low variability have to be achieved in the business. It has a large volume that
helps it to achieve its cost target. In the face of extreme competition, Starbucks must slash its
costs so that it can gain more market share (Sholihah et al . 2016). Standardization helps the
organisation to achieve economies of scale that are known as the big leap in cost reduction.
Besides that, the organisation has set time goals, based on the high volume , low variability and
high visibility. In the specified time, they must satisfy the customer. By results of a 4V study
Starbucks has become streamlined by regular service and the time to serve customers food is
much less. Moreover, due to the fact that time taken to serving food is significantly perfect,
Starbucks will make some substantial operational steps due to the low choice, and the consumer
has to wait no longer in queues (Slack and Brandon-Jones 2018). Moreover, in organisational
standardisation, guidelines are quite a few because of routine operations and Starbucks is
considerably time effective in its service in this regard (Li and O'Neill, 2019).
9
standardisation and low variability have to be achieved in the business. It has a large volume that
helps it to achieve its cost target. In the face of extreme competition, Starbucks must slash its
costs so that it can gain more market share (Sholihah et al . 2016). Standardization helps the
organisation to achieve economies of scale that are known as the big leap in cost reduction.
Besides that, the organisation has set time goals, based on the high volume , low variability and
high visibility. In the specified time, they must satisfy the customer. By results of a 4V study
Starbucks has become streamlined by regular service and the time to serve customers food is
much less. Moreover, due to the fact that time taken to serving food is significantly perfect,
Starbucks will make some substantial operational steps due to the low choice, and the consumer
has to wait no longer in queues (Slack and Brandon-Jones 2018). Moreover, in organisational
standardisation, guidelines are quite a few because of routine operations and Starbucks is
considerably time effective in its service in this regard (Li and O'Neill, 2019).
9
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But there is no versatility in its working due to standardisation. The staff must comply with strict
rules and procedures in order to make a regular meal and to satisfy customers ' demands. No
space for innovation and creativity exists in this respect. The rules and processes for making food
and serving the customer are described. Consequently, the goal of versatility is low (Zhang,
Wang and Lin, 2019). But there is no versatility in its working due to standardisation. The staff
must comply with strict rules and procedures in order to make a regular meal and to satisfy
customers ' demands. No space for innovation and creativity exists in this respect. The rules and
processes for making food and serving the customer are described. Consequently, the goal of
versatility is low (Zhang, Wang and Lin, 2019).
Finally, Starbuck doesn't rely on different manufacturers or sellers. Rather, the organisation will
have considerable influence over its supplier due to its high volume and standardisation. This is
because Starbucks depends heavily on its supplier.
Greggs
Performance Map
10
rules and procedures in order to make a regular meal and to satisfy customers ' demands. No
space for innovation and creativity exists in this respect. The rules and processes for making food
and serving the customer are described. Consequently, the goal of versatility is low (Zhang,
Wang and Lin, 2019). But there is no versatility in its working due to standardisation. The staff
must comply with strict rules and procedures in order to make a regular meal and to satisfy
customers ' demands. No space for innovation and creativity exists in this respect. The rules and
processes for making food and serving the customer are described. Consequently, the goal of
versatility is low (Zhang, Wang and Lin, 2019).
Finally, Starbuck doesn't rely on different manufacturers or sellers. Rather, the organisation will
have considerable influence over its supplier due to its high volume and standardisation. This is
because Starbucks depends heavily on its supplier.
Greggs
Performance Map
10
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Greggs have set the key goal on the basis of 4V analysis. The organisation has done an
unstandardized procedure in that respect to implement a range of foods and beverages.
Furthermore, diversity is not feasible if their processes are not versatile. Greggs found their
procedures inflexible, since workers would cook food differently. Often workers are overcharged
with flexible working conditions and the production of different foodstuffs (Ichinose et al, 2018).
Moreover, the quality is their main priority, but quality can not be achieved 100% due to such a
complex operating mechanism. The process would be faulty and errors. However, the codes of
conduct that regulate workers are developed in order to keep an employee engaged and oriented
to error-free operations. Greggs does have a time goal, but is not given priority as Starbucks. The
organisation tries to service the client quicker, but compared with other structured operations
such as Starbucks it is very slow.
Section 3: Design Analysis
11
unstandardized procedure in that respect to implement a range of foods and beverages.
Furthermore, diversity is not feasible if their processes are not versatile. Greggs found their
procedures inflexible, since workers would cook food differently. Often workers are overcharged
with flexible working conditions and the production of different foodstuffs (Ichinose et al, 2018).
Moreover, the quality is their main priority, but quality can not be achieved 100% due to such a
complex operating mechanism. The process would be faulty and errors. However, the codes of
conduct that regulate workers are developed in order to keep an employee engaged and oriented
to error-free operations. Greggs does have a time goal, but is not given priority as Starbucks. The
organisation tries to service the client quicker, but compared with other structured operations
such as Starbucks it is very slow.
Section 3: Design Analysis
11

Impact on the design of the customer service process
The customer service process has a huge effect because of the Standardization at Starbucks,
inflexible processes, low turnover and high volume. First of all, customer service is very
sensitive and effective with standardisation. The production and operation of the customer is not
delayed and most orders are prepared within the agreed time span. Moreover, Starbucks typically
have high sales volumes and, as a result, standardisation in their customer service area is critical
(Gino, Coffman and Huizinga, 2019). The customer is requested to choose a low variety menu,
so it is not long and hectic to order food. In addition, in response to customer inquiries, the client
representative is comfy and truthful (Meredith and Shafer, 2019).
Greggs have various customer support systems on the other hand. Owing to the great variety and
changing demand the customer representatives also had to justify their menu to the customer. In
addition, customer support requires explicit guidance from consumers as to whether they should
tailor the food to their particular needs (Zhang, Wang and Lin 2019). This can also be very
unsuccessful, as customer service does not have established rules and processes.
Impact on the design of store layout and flow
The layout of the store Greggs and Starbucks is designed such that self-service is encouraged.
The client orders food on the counter and only takes food when the number arrives. The risks of
error and failure are therefore very low. In addition, the self-serve shop layout supports both the
traditional Starbucks operation form supporting high volume , low variance, high visibility and
low variation, and the versatile Greggs operation supporting low volume, high variability, low
visibility and great variation (Slack and Brandon-Jones 2018).
For example , Starbucks may cater to a large number of customers with a self-service operation
layout. The customer service can order and require the customer to wait. The customer must not
wait in Que in this way. Instead, the customer may be clarified by Gregg 's representative or
appoint a special employee at the counter (Meredith and Shafer, 2019). This helps us to take
customer orders more accurately.
12
The customer service process has a huge effect because of the Standardization at Starbucks,
inflexible processes, low turnover and high volume. First of all, customer service is very
sensitive and effective with standardisation. The production and operation of the customer is not
delayed and most orders are prepared within the agreed time span. Moreover, Starbucks typically
have high sales volumes and, as a result, standardisation in their customer service area is critical
(Gino, Coffman and Huizinga, 2019). The customer is requested to choose a low variety menu,
so it is not long and hectic to order food. In addition, in response to customer inquiries, the client
representative is comfy and truthful (Meredith and Shafer, 2019).
Greggs have various customer support systems on the other hand. Owing to the great variety and
changing demand the customer representatives also had to justify their menu to the customer. In
addition, customer support requires explicit guidance from consumers as to whether they should
tailor the food to their particular needs (Zhang, Wang and Lin 2019). This can also be very
unsuccessful, as customer service does not have established rules and processes.
Impact on the design of store layout and flow
The layout of the store Greggs and Starbucks is designed such that self-service is encouraged.
The client orders food on the counter and only takes food when the number arrives. The risks of
error and failure are therefore very low. In addition, the self-serve shop layout supports both the
traditional Starbucks operation form supporting high volume , low variance, high visibility and
low variation, and the versatile Greggs operation supporting low volume, high variability, low
visibility and great variation (Slack and Brandon-Jones 2018).
For example , Starbucks may cater to a large number of customers with a self-service operation
layout. The customer service can order and require the customer to wait. The customer must not
wait in Que in this way. Instead, the customer may be clarified by Gregg 's representative or
appoint a special employee at the counter (Meredith and Shafer, 2019). This helps us to take
customer orders more accurately.
12
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