MBAEH18301: HR Planning & Audit Project - Starbucks Analysis

This project provides a detailed analysis of Starbucks' Human Resource Management (HRM) practices, focusing on planning, audit, and the challenges the company faces. It begins with an introduction to Starbucks' corporate mission and its reflection in HRM practices, emphasizing the importance of motivated human resources. The project covers organizational processes, performance management, employee benefits, and customer satisfaction, highlighting Starbucks' investment in training and employee welfare. It also explores employee motivation theories applied within Starbucks, such as equity theory and Maslow's hierarchy of needs. Furthermore, the project discusses Starbucks' recruitment and selection policies, employee development strategies, and the evolution of HRM practices over time. The challenges Starbucks faces in maintaining its reputation as a positive employer amid rapid expansion are also addressed, along with the company's internal standards, public policy advocacy, and global experience. The project concludes by emphasizing Starbucks' commitment to ethical business standards and its mission to nurture the human spirit.

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MID – SEMESTER EXAMINATION
MODE OF EXAMINATION – PROJECT SUBMISSION
FOLLOWED BY VIVA-VOICE
SUBJECT NAME- HUMAN RESOURCE PLANNING AND
AUDIT
SUBJECT CODE MBAEH18301
DATE OF EXAMINATION :-
SUBMITTED TO:- SUBMITTED
BY:-
NAME

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ACKNOWLEDGEMENT
I have taken efforts in this project. However, it would
not have been possible without the kind support and
help of many individuals and organizations. I would
like to extend my sincere thanks to all of them. I am
highly indebted to _____________________ for their
guidance and constant supervision as well as for
providing necessary information regarding the project
& also, for their support in completing the project.
I would like to express my gratitude towards my
parents for their kind co- operation and
encouragement which help me in completion of this
project.
I would like to express my special gratitude and
thanks to friends for giving me such attention and
time. My thanks and appreciations also go to my
colleague in developing the project and people who
have willingly helped me out with their abilities.

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DECLARATION
I herebydeclarethattheprojectentitled‚InternationalHRM
practicesof Starbucks‛submittedto ‘JAGRANLAKECITY
UNIVERSITY BHOPAL’ is record of original work d
under the guidance of ______________________( de
commerce).Any inferences,researchor similarityis purely
coincidental.

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CONTENT
S.no Topic Page no
Introduction 5
Overview of organizational processes 6
Performance management, benefits,
and customer satisfaction
8
Employee motivation 9
Starbucks HRM Practices and Policies 11
Current and past HRM practices in
Starbucks
13
Past and Current HRM challenges in
Starbucks
14
Internal standards and Public Policy at
Starbucks
15
Work Culture at Starbucks 16
Competitive Challenges 17
Unions, Equitable Pay and Working
Conditions
18
Starbucks Global Experience 19
Conclusion 20

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INTRODUCTION
Starbucks corporate mission "to inspire and nurturing the human spirit,
one person, one cup one neighborhood at a time. This particular mission
statement is equally reflected in the organizations HRM practices though it
has not been without challenges. Starbucks holds that committed and
motivated human resources are instrumental to the success of outstanding
retail business. Thus the company has invested in selecting the right people
and come with different measures in retaining them. Its human resource
practices are a reflection of the company's commitment to its employees. In
creating the Starbucks experience the company overwhelmingly reliant on
front line staff and baristas which differentiated it from its major competitors.
Therefore the company closely pays attention to the kind of staff that it brings
on board. Starbucks ' recruitment motto revolves around having the right
people recruiting the right people. The company initially hired people for
qualities such as dependability, adaptability, and ability to work as a team.
Through describing the qualities that it looked for in employees in job
postings the company has always been in a position to allow employees to
self-select themselves to extend.

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OVERVIEW OF ORGANIZATIONAL PROCESSES
After selecting the right kind of people the company then embarks on training
them regarding the skills that would be necessary for guiding them to perform
their jobs effectively. Starbucks is one of the few retail companies that has
been in a position to offer its employees training by offering them
comprehensive training across all classes of employees. Starbucks ' challenge,
however, remains at ensuring that its image as a positive employer survives its
expansion program in the contemporary world. In striving to achieve its place
has a reputable employer the company has invested in finding the right people
in the right numbers to culminate its expansion strategies. Its expansion trend
has worried analysts as the company's expansion strategy has made it triple in
size over the years. However, since the onset of the 21st century, there have
been signs that its high human resource costs and generous employee policies
where reflecting on its financial strengths. Though the company has been
reluctant to disclose the amount it spends on employees it management
revealed that it spends a huge amount compared to that invested in the
advertisement. Increasing the prices of its coffee by 11 cents served as an
ultimate indicator that the company was spending more on recruiting and
retaining its employees. The analyst has been worried whether the move was
necessary given the fact that its customers where already paying a premium to
have Starbucks coffee. However, this sounded like a good move as cutting

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down employee benefits would demoralize them thus affecting their output at
the company. Hence Starbuck's investment in employee welfare remains a core
function in the company that has positively influenced its human resource
practices. Its employees are vividly motivated and invest a lot in ensuring
customer satisfaction. Through employee and customer satisfaction it is thus
evident that the company continues to hold on its mission statement as it looks
towards changing the industry it operates in.

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Performance Management, Benefits, And Customer
Satisfaction
Starbucks has embarked on various programs that ensure that it offers
employees sufficient knowledge on organizational values which they in turn
transfer to its customers. Through the first impression, baristas have developed
an art of interacting with customers in terms of service principles. Employees
are made aware of the company's history and taught how to use the cash register
effectively. Additionally, they learn the right communication skills that enable
them to interact well with customers in creating the environment that Starbucks
strives to promote. Through the Perfect the Art Espresso a training was held to
ensure that baristas deliver high-quality espresso. Additionally at Starbuck
people are viewed as the main resource and training activities involve a
balanced scorecard. Growth and learning perspective revolves around training
employees on the best organizational practices. Through this particular scheme,
employees get to understand more about different organizational perspectives
which are necessary for ensuring change with the organization. It is through
this particular approach that Starbucks has been in a position to develop a
workforce that is suitable for catering for its large client base with ease.

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Employee Motivation
Motivation is the persistence directed towards ensuring that people strive to
achieve personal and organizational goals. It is an important factor in any
business as it promotes efficiency in the workplace. Starbucks applies different
motivation theories in ensuring that employees improve efficiency and make them
enjoy being part of Starbucks. According to the equity theory people tend to be
motivated whenever they realize that they are being treated fairly. Within
Starbucks, every employee is treated by managers as a partner including basic
staff who work for the company. An interesting thing about Starbuck employees
is that they can co-work with each other something that is not the case in many
organizations. By applying equity theory employees within Starbuck have the
feeling that they are working in a lively, friendly and enthusiastic environment
that works without a sense of status. The sense of belonging to the company
makes employees remain satisfied with their job hence increasing the efficiency
of the business.
Additionally, different employee benefits are covered by Starbucks management
to ensure that they satisfy needs at the workplace. Starbucks currently caters to
employee's medical care and increases their pay as they continue to work for the
organization. Employees are also trained on how to handle customers as well as
the process of making coffee.AS a result, Starbucks employees are motivated
towards increasing sales and ensure that the organization remains profitable.
Starbuck has also applied Maslow's hierarchy of needs within its motivation

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theories (Al Halbusi,2017). Through the management, Starbuck initiates
programs that ensure employees satisfy belonging, safety, and love needs.
Through employees treating each other as partners their belonging need is
satisfied. Hence the more employees contribute towards the wellbeing of
Starbucks the more they get paid. This has resulted in employees setting
personal goals to ensure that they earn the organization profit and serve
customers well.

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Starbucks HRM Practices and Policies
Starbuck remains one of the best companies that employees can work for on a
global scale. Starbucks gains its competitive advantage from its supportive work
culture and friendly employee policies. Starbuck prioritizes on recruiting and
retaining the right type of employees Its human resource practices are designed
in a manner that allows to peak competent candidates that match the required
skills. Below is a discussion of the various human resource practices within
Starbucks;
1. Recruitment and Selection Policy
Many studies have shown that effective selection and recruitment is essential for
the success of an organization. The exercise is supposed to be designed
organizational needs and rigorous for the organization to achieve high-
performance goals. Additionally, studies have shown that there exists a positive
correlation between a good reward system and organizational performance.
However, a reward system that considers performance remains a function of the
human resource management department. Currently, Starbuck relies on different
aspects of hiring its employees.
The organization invests intensively on its human resources to ensure that they
remain satisfied. Starbucks reviews the potential capability of applicants from
the time they apply for a job to the time they are offered an opportunity to work
for the organization. The rigorous exercise ensures that they end up absorbing
the most appropriate employee.

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2. Employees Development Policy
Organizational performance largely depends on the policy that it applies to
develop employees. Organizations apply different policies in developing their
human capital. Starbuck banks on offering their employees non-technical and
technical training in repairing them to handle the organization's business
appropriately. The level and manner in which an organization invests in
increasing employees' knowledge determine its future success. Starbuck has
developed a positive relationship between employee development policies and
organizational performance. The organization strives to have a long-lasting
relationship with its employees by offering them good pay and enabling work
environment. It develops a proper career development program that enables
them to design for their time properly. Starbuck additionally promotes
employees from within to show them the essence of working hard.