Starbucks Operations: Four Vs, Design, and Strategy Analysis

This report provides a detailed analysis of Starbucks' operations management and service excellence. It begins with an introduction defining operations management and service excellence, followed by a comparative analysis of Starbucks and Greggs using the Four Vs framework (volume, variety, variation, visibility). It then examines comparative performance objectives (quality, cost, flexibility, speed) and design aspects such as customer service process and store layout. Part B focuses on Starbucks' global operations strategy, macro-environment, key requirements, challenges, and an analysis of its chosen operational area (quality management). The report concludes with recommendations for Starbucks' operations and emphasizes the importance of quality management in achieving organizational goals and objectives. It also provides an overview of Starbucks' global operations strategy and the surrounding macro-environment. The report examines the impact of the chosen operational area on Starbucks’ performance, including the importance of quality management for success. The report also analyzes the design of Starbucks' store layout and flow and their impact on customer experience and brand image.

Operations Management
and Service Excellence

Table of Contents
INTRODUCTION...........................................................................................................................3
PART A...........................................................................................................................................3
1. Comparative Four Vs Analysis...............................................................................................3
2. Comparative Performance Objectives Analysis......................................................................5
3. Design analysis........................................................................................................................6
PART B ...........................................................................................................................................8
1. Overview.................................................................................................................................8
2. Starbucks global operations strategy and surrounding macro-environment...........................8
3. Key requirements, capabilities and challenges.......................................................................9
4. Analysis and evaluation of chosen operational area.............................................................10
5. Recommendations.................................................................................................................12
CONCLUSION..............................................................................................................................12
REFERENCES..............................................................................................................................13

INTRODUCTION
Operation management is defined as controlling and designing of process of business
operations and production in terms of goods and services (Alsmadi, Almani and Jerisat, 2012).
Similarly, service excellence is the process of providing high quality services to consumers and
people to create loyalty, goodwill and brand value. It is very important for organisation to
provide excellence services and manage operating activities and business in an effective manner.
The organisation given for report is Starbucks which was founded in 1971 at Washington. This is
serving million of customers in 80 countries and operating business 30,000 retail stores. This
report is prepared to know about operations of respective organisation at local as well as
international market. There are two parts where part first covers four vs analysis, performance
objective analysis and design of Starbucks and Greggs and second part covers global operations,
macro environment, challenges, capabilities, requirements, areas of operations.
PART A
1. Comparative Four Vs Analysis
It refers to a method which includes four main elements used by the management team in
order to transform every raw material as well as resources in such a manner that it produce
productive results (Asif and de Vries, 2015). It has also been analysed that every business
organisation requires wide range of operations in order to transform raw material into finished
goods. In order to accomplish organisational goals an d objectives in an effective manner there
are some elements which are necessarily required by the management team of an organisation.
These common elements includes money, raw material, tools, equipment, approaches and so on
so that quality of finished goods will be maintained. There are four common dimensions which
includes volume, variation, visibility and variety. Effective utilisation of these elements help in
creating value to the products and services offered by company at the competitive marketplace.
With the assistance of this, organisational goals will be accomplished in an effective manner
within given period of time. In this context two main organisation has been chosen which are
Greggs & Starbucks. In this reference, detail analysis are going to be discussed in an effective
manner which are as follows:
Four Vs Elements Starbucks Greggs

Volume It is the first element of four Vs
analysis where the main principle is
low cost and high production. In
simple words, it has been said that
management team of the company
produce high quality goods within
low cost. This will be done only if the
company start producing goods and
services at high level. With the help
of bulk manufacturing, managers will
be able to low down their cost.
In reference to Greggs, it has been
said that company requires
continuous improvement in
production level so that they can
enhance their overall profitability
at the competitive marketplace.
With the assistance of bulk
production company will be able
to lower down their overall cost
of the organisation (Talib, Rahma
and Qureshi, 2012).
Variety It refers to the element with the help
of which new products will be
produced by the company in order to
influence large number of customers.
With the assistance of variety of
products, company will be able to
increase their overall profitability at
the competitive marketplace.
In context of Greggs, it has been
said that it is very essential for the
company to make innovation so
that they can beat the competition
level available at the marketplace.
Variation On the basis of this element, it is said
that managers need to introduce
variations in their goods and services.
In the present context of Starbucks, it
is very essential for them to include
some variation in their products so
that they can attract new customers
towards the organisation.
This the element, where managers
of Greggs require to add some
new variations in their flavour
according to the needs and
requirements of customers so that
they can retain them for a longer
period of time (Zehir and et. al.,
2012).
Visibility It refers to the element, wherein
customers do have ample number of
options where they can have ample
It is the factor in which customer
will be able to notice all the items
offered by the company. In the

number of options in order to
communicate any kind of issues face
by them. For example, if an individual
put some request with the help of
online sources, they will be able to
identify the present location of the
goods.
present context of Greggs, it has
been said that they have their
physical outlets.
2. Comparative Performance Objectives Analysis
It has been identified that there are various kind of performance objectives adopted by the
top management team of both the chosen organisation (Bhullar and et. al., 2014). In every
organisation, main focus of a management team is there staff members as they are the most
significant element assist in accomplishing organisational goals and objectives within given time
frame. Some of the key performance objectives are going to be discussed as follows in an
effective manner:
Quality- In the present context of Starbucks, it has been said that management team of
the company need to maintain the overall quality of the products and services offered by them so
that they can grab attention of large number of individuals towards their company. It has also
been said that, Starbucks have their own quality management department which help them in
order to produce goods according to a set standard. Whereas, in case of Greggs they manufacture
high quality bakery products which help them in order to establish a positive market position.
Cost- Main cost of Starbucks consumes coffee beans which they use as their main
ingredient (Bon and Mustafa, 2013). They use high quality coffee beans with the help of which
they produce and maintain the quality of their coffee. Management team of Starbucks, attempts
to reduce the cost of raw material so that they gain more profitability at the marketplace. In the
present context of Greggs, different type of bakery equipments requires to produce high quality
products which are costly. In order to reduce the extra cost, managers of the company decides to
buy raw material in bulk and minimise the wastage of products and service.
Flexibility- It has been said that one of the most essential element is flexibility which is
required by the management team of an organisation while doing business operations at the
marketplace. Management team of Starbucks are flexible in nature as they modify their strategies

and policies as per the modifications arise within the external environment. This is the element
which directly creates positive image of the company for both the organisation as they can easily
alter their strategies.
Speed- It is the element which is highly interrelated with flexibility. It refers to the
element which is highly associated with the experience of an individual person (Boulter, Bendell
and Dahlgaard, 2013). In short, it has been said that this factor is linked to the experience of
customer as for how long an individual has to wait show the satisfaction level. In this context,
Starbucks successfully install a system with the assistance of which they can reduce the waiting
time face by customer. Whereas, in context of Greggs, managers adopt strong and effective
communication channel so that they can enhance the overall profitability of the company at the
competitive marketplace.
With the help of above mentioned analysis, it has been said that all these elements help in
examining the overall performance of the company so that they can modify their strategies and
policies as per the requirements. Furthermore, it will assist in attaining organisational goals and
objectives of the company in an effective and appropriate manner.
3. Design analysis
It is very important for organisation to analysis their design in proper manner to attract
large number of consumers in an effective manner. The design analysis of respective
organisation are as follows:
Impact on Design of Customer Service Process- Customer service is defined as range
of consumers that is used to assist their users to prepare about use of specified goods (Calabrese
and Scoglio, 2012). Such types of analysis is importance in whole process that starts from
planning, training, implementation, maintenance, disposal of several products and services. This
is regarded as segment that deals in various business in order to maintain customer satisfaction
level so that they will buy products and services in best manner. In context of Starbucks,
management team is providing high quality service after as well as before purchase of products
that leads to create and maintain satisfaction level of consumers. The respective organisation
focus on taking regular feedback from their consumers in order to improve their functions and
activities as per expectation and requirements of customers in best possible manner. In context of
Greggs, it is using respective method in order to create positive impact on mindset of consumers
that leads them to visit and create publicity for product and their brand at marketplace. This helps

manager to modify products and services which are provided by them to their consumers in order
to retain their users for long period of time along with creating brand value, goodwill and loyalty
in mind of people regarding business and their activities.
Impact on Design of Store Layout and Flow- This is the most important requirements
of each and every organisation in order to attract large number of consumers with their design,
structure (Calvo-Mora and et. al., 2014). In today's time, both online as offline store leads to
attract large number of customers and maintain reputation of brand value at marketplace in best
possible manner. In context of Starbucks, physical stores are available that helps them to attract
to visit place and buy coffee and avail services. The store layout of Starbucks is different and
unique from competitors which really helps in attracting large number of consumers. It is very
important for business to have unique, attractive ambience for their users where they can sit and
feel comfort. Similarly, in context of Greggs, managers deal in bakery products that provide
online as well as offline presence to consumers in best possible manner. This leads company to
achieve competitive advantages and achieve success, growth and development of business in
effective and efficient manner.

PART B
1. Overview
The operational area chosen for Starbucks is quality management which is defined as act
of overseeing each and every activities and works that should be maintained in order to achieve
desired level of excellence (Guerreiro, Neto and Moreira Filho, 2014). This includes
determination of policy of quality, implementation & creation of quality planning, improvement
and control in an effective and efficient manner. Scope of quality management is to outline about
standards and policies related with quality are applied within operation of company. Starbucks
focus on improving quality of their products and services in an effectual manner so that
consumers get high quality goods and services. This helps in organisational performance as they
accomplish set goal and objectives in appropriate manner. The respective operations help
business to carry out work and provide good with quality to final consumers without any
difficulties. Therefore, it is very important for respective organisation to have proper operation in
business to accomplish desired results.
2. Starbucks global operations strategy and surrounding macro-environment
The chosen operations area is quality management which is affected due to several
reasons such as lack of adopting proper guidance regarding managing quality, unable to adopt
techniques for proper management (Kim, Kumar and Kumar, 2012). Starbucks has to adopt total
quality management in their business in order to respond to macro business environment. They
have to analyse market in proper manner to know about their consumers and chose appropriate
quality for providing them products and services. This can be improve through adopting global
operation strategy i.e. differentiation by Starbucks. It is an approach that is used by business in
order to develop unique good or services which consumers will find better than their distinctive
from goods offered by competitors. Such global strategy helps respective organisation to be
different from their competition in an effective and efficient manner for positive outcomes. With
the adoption of such strategy by Starbucks, they can respond to macro business environment.
The respective organisation has adopted differentiation strategy by providing uniqueness
and product different from competitors and in order to promote it at marketplace. The quality
management operations area can be improved through such global strategy as it focus on
products to be different and quality to be up to date in best manner. While carrying out

operations activities in business, it is necessary to have global strategy. The respective
organisation has to cope up with macro business environment in order to provide high quality
product and service with help of quality management operations by adopting differentiation
strategy. While expanding business in various countries various consideration has to be taken
such as:
Technological Changes- The respective organisation has an opportunity to increase their
effectiveness for overall operations of brand that leads to enhance market share and cost
reduction for increasing revenue (Lashley, 2012).
High Economic Growth- There are various opportunity which are available to Starbucks
where they can enter into new countries to increase their high profits margins. This will leads to
high economic growth rate at marketplace.
The above presented are points that are helpful for Starbucks in context of positive as
well as negative aspects. It helps in dealing with each and every situation arise in business.
3. Key requirements, capabilities and challenges
In order to run business in successful and proper manner, it is very important to adopt
operation so that each and every work can be performed (Naser, Al Shobaki and Amuna, 2016).
The key operational requirements are capabilities, measure of suitability & technical,
performance measurement of effective and so on. It is very essential to have quality
management as operation requirements in Starbucks which helps to manage quality of products
provided by them. While carrying out operational work, challenges has to be faced by respective
organisation for achievement of goal and objectives in an effective and efficient manner. The
need of operation is required on day to day basis as respective organisation charges high prices
for products and services where consumers are paying high cost to purchase it. In this case, they
prefer quality goods as well as services from it in an appropriate manner. For effective
functioning of Starbucks quality management, techniques, skilled manpower, resources, proper
implementation and planning of strategies, following of standards related to quality and so on.
For running of quality management at Starbucks, capabilities required are as follows:
Skilled manpower- For quality management, it is very important to have skilled
manpower who can run and manage quality at business for positive outcomes. They can provide
high quality products for consumers.

System- It is the capabilities of respective organisation where proper system is needed to
manage quality of products and services in proper way. This helps them to achieve goal and
objectives in best possible manner.
Apart from this, while conducting operation activity of quality management, different
challenges can be faced by Starbucks which are as follows:
Lack of Skilled Manpower- It is the major challenges arise in managing quality. In
today's scenario, it is very difficult to find highly skilled manpower for work performance
(Oakland, 2014). As they have to be provided with regular training and development to
overcome from such challenges.
Lack of Techniques- It is also the another challenges faced by Starbucks for carrying out
operation activities at marketplace. There are number of techniques which are available for
quality management so it is difficult to chose best techniques and apply in business for positive
outcomes.
4. Analysis and evaluation of chosen operational area
From the presented discussion, it has evaluated that Starbucks has to maintain quality in
proper manner as it is everything for increasing brand value and goodwill of business and leads
to attract large number of consumers and market share. It has made several efforts in order to
maintain brand value and goodwill at marketplace for achievement of goal and objectives. They
spend more than 18 weeks time period every year by visiting several suppliers of coffee and
growers in order to make suer about coffee beans that are produced as per required standard of
business. With the evaluation of each and every aspects, process of quality should be improved
in Starbucks that are described below:
Commitment- As compared to other brands available at marketplace, the commitment
level of Starbucks is rarely seen in other companies (Oliveira and Roth, 2012). There are large
number of people who works in respective organisation for positive outcomes. The stakeholders
such as creditors, employees, debtors, authorities, investors, shareholders who are performing
work at respective organisation have strong commitment level towards achievement of business
goal and objectives in appropriate manner. It is positive evaluation of such brand at marketplace
that makes feasible to attain goals and objectives.
System of random checks- Starbucks is highly recognised and well known brand at
marketplace that uses system of random checks that is performed through several district

managers where main roles and responsibilities are to check baristas, taking feedback from
people, abstracting information from different consumers and checking drinks so that users will
get high quality products and services. This will be ensure that required quality is being
maintained at particular outlets.
Exceptional quality if raw materials- The respective organisation uses exceptional
quality of coffee beans in order to provide better customer experience in terms of taste and
unique coffee flavour that is different from competitors or other brand. Starbucks has adopted
differentiation strategy in order to survive and sustain at competitive market place for providing
unique and different products.
Consideration of quality and cost- Starbucks is maintaining quality of their products
and services in best manner by using cost control and investing resources which will leads to
utilise in optimum manner (Sampson, 2012). It helps in establishing effective functions in all
operations and activities of organisation in order to achieve their targeted profits and gains in
best possible manner.
Development of strategies- Starbucks always focus on developing various strategies for
maintaining quality of products, provide genuine services, inviting proper atmosphere in order to
meet need and demand of their consumers in appropriate manner. They have to develop
strategies on continuous basis so that maximum profits and gains can be achieved in an effective
and efficient manner.
Achievements- In order to enhance market share and increase profit margins, Starbucks
has to maintain quality standards in their business for positive results (Suárez-Barraza, Smith and
Dahlgaard-Park, 2012). Due to quality of products supplied by respective organisation has able
to achieve good brand value and goodwill at marketplace. Starbucks has achieved awards and
recognised as Best Coffee due to standard of quality maintained by it from long time period. It
never decline quality of products and focus on providing high services to them in best possible
manner.
Segmentation of market- It is the approach that is applied by Starbucks when they
segment their targeted market and accordingly they focus on product bundle for their consumers
at marketplace. The founder of Starbucks is Schultz who tries best in order to bring innovation
ideas so that they can expand their brand portfolio of their goods and services in best possible

manner. They follow strategic quality ideas for their coffee giant in order to show that there is no
declination in profitability percentage. This will leads to successful in sales growth in next year.
Therefore, respective organisation is trying their best to achieve level of quality in order
to sustain and survive at marketplace in order to maintain profitability ratio for long time period.
5. Recommendations
In order to improve in their quality management process, Starbucks has to follow some
recommendation for positive outcomes. It is provided after the analysis of above factors which
are as follows:
 It is recommended to Starbucks, to adopt services for their consumers so that sales will
not be affect. The improvement done in quality standards will leads respective
organisation in order to improve process as well as standards of supply chain in best
possible manner.
 It is recommended to respective organisation to make better products and services to
enhance market share and sales in proper manner. It is defined as tool that will assist
particular category of consumers who are cultured, educated and interested in large
customer base. Therefore, this will lead to increase brand image and goodwill of
Starbucks at marketplace by fulfilling need and demand of consumers.
 The respective organisation has to maintain quality in their business by doing continuous
improvement plan that helps in maintaining consistent quality across outlets in world.
They have to adopt total quality management techniques in order to improve their quality
for products and services and provide it to their consumers in best manner.
Therefore, the above recommendation should be applied by respective organisation so
that goal and objectives can be attained and achieved.
CONCLUSION
From the above report, it has concluded that assignment is prepared on various aspects of
organisations related with management process and their operations. The different affect on
overall functioning of business like quality standard, supply chain management, improvement &
maintenance which bring positive as well as negative brand image and affect goodwill. The
quality management is defined as procedure that is helpful for institution in order to improve
brand image and carrying business operations in efficient and effective manner.

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