Starbucks Corporation: Organizational Structure and Design

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MGMT1101: Research and Analysis Paper- Part II
First Name:Rupinder
Last Name:
Instructor’s Name:
Date of Submission:

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Introduction
In this assessment, the report is about the analysis of the famous coffee brand “Starbucks”. This
assessment will be mentioning the SWOT analysis along with the environmental constraints.The
shareholders and the motivation theories used by Starbucks will be discussed. Further, the
organizational structure and design Of Starbucks will be discussed. In the end, controls to
evaluate the progress will be discussed. Recommendations will be provided on how Starbucks
can improve their business.

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About Starbucks
Starbucks is a famous coffee brand which started its services in the year 1971. The company is a
brand in itself and is functioning in 30.000 places. Starbucks was founded by Gordon Bowker,
Jerry Baldwin and Zev Siegl (Starbucks, 2019).The company tries to make every cup of coffee
memorable for its customers. The mission says, “To inspire and nurture the human spirit – one
person, one cup and one neighbourhood at a time” (Starbucks, 2019). The company tries to club
two new flavours to create a unique flavour for its customers. Along with coffee, sandwiches and
burgers are also served by the company which makes the taste of the coffee more
delicious.Along with the customer satisfaction, the company has joined various environmental
programmes, to protect and contribute in the environmental sustainability(Starbucks, 2019).
SWOT Analysis
 Strengths of Starbucks are highly motivated and innovative staff and bonuses and
rewards to the employees.(Smithson, 2017). The staffs work hard to provide the customer
a better experience. Also, creative staff willhelp in the growth of the company. The
wages and bonuses provided by the employees keep them motivated and encouraged to
work hard.
 Starbucks coffee is very expensive because of which the poor people can’t afford to buy
it. For this, Starbucks should provide discounts and special offers for the poor
people.Also, company doesn’t practise fair advertising to the customers. This can impact
the society negatively. To recover this weakness, the company should involve in the fair
and honest advertising(Smithson, 2017).

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 Starbucks is operating in more than 30,000 locations. This is a great opportunity to take
the company to a next level by selling the best coffee ever.Also, the wider network will
help the company to expand them in different countries(Smithson, 2017).
 Starbucks should reduce the price of the coffee. The expensive price creates a negative
influence in the minds of the customer. If the price will be reduced, the competition will
reduce. The company will become more popular if the prices are reduced(Smithson,
2017).
Environmental Constraints
Specific Environment of Starbucks are its
 Customers- Starbucks is an International Coffee brand. The coffee at Starbucks is really
expensive; therefore, it can be afforded by the elite class only. Poor people can’t afford
the coffee due to the high prices.
 Suppliers- Coffee beans at Starbucks are made with eco-friendly machines and are
supplied to the stores and other operating countries. The suppliers of the company are
famous for its on-time delivery (Smithson, 2017).
 Competition- Being an international brand, the competition of Starbucks is high. Due to
its popularity and the coffee, the company has a good number of competitors.
PESTEL Analysis of Starbucksspecifies the global environment.
 Political-Government in the counties is improving the infrastructure and market. This
creates an opportunity to access more markets across the world(Smithson, 2017).
 Environmental- For the environment safety, Starbucks produces coffee beans under the
eco-friendly machines.

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 Social- Starbucks can increase its sales and profit by preparing the coffee, which the
customer demands. The company can also widen its market and growth by reducing the
cost of the coffee(Smithson, 2017).
 Technological- Starbucks uses eco-friendly technology for the production. Also, there is
an opportunity for Starbucks to start online delivery of the coffee by launching an app.
 Economic- decline in the employment helps Starbucks in to earn more revenue from the
market. Rise in the labour cost poses a threat to Starbucks (Smithson, 2017).
 Legal- Starbucks protects the rights of the customer. It can also increase its customers by
providing the coffee to the poor people as well (Smithson, 2017).
Shareholders
Starbucks respects its shareholders and partners. The shareholders trust the brand and have faith
towards the brand.Starbucks put all its efforts to satisfy their shareholders.The main shareholders
of Starbucks are-
 Mellody L Hobson, President of Ariel Investments, who purchased the shares of
Starbucks and help made it the second- largest coffee brand in the market.
 Howard Schultz, founder and Former CEO of Starbucks, purchased all the company’s
assets and became the CEO (Rego, 2018).
 John Culver, President of Global Retail- John owned 366, 402 shares and helped in
making the company stronger in the International Market(Rego, 2018).
 Clifford Burrows, President of Siren Retail- Clifford owned 248,225 shares of Starbucks
and managed the company from 2008-11(Rego, 2018).

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Organizational Structure and Design
Taking about the organziational structure and desing, Starbucks has a Chief Executive Officer.
Under the Chief Executive Officer, there comes the finance department, human resource
department and marketing department (Holleman, et.al, 2013). Finanace department is resposible
for maintaining the budget and counting the sales and profit of Starbucks. Human Resource
Department is responsible for the hiring the qualified staff and providing training to the new
employees of the organization. Marketing Department is responsible for promoting the brand
worldwide. The marketing department uses new media techniologies for the promotion of the
brand.Along with these major departments, there are regional preseidents also. All the issues and
problems are then sloved by the CEO of the company(Holleman, et.al, 2013).
Motivating Employees
There are certain theories of Starbucks uses Maslow’s theory to motivate and encourage the
employees. The Maslow’s theory of motivation states that the employees must be satisfied with
the job and the bonuses. The satisfaction provided is in a hierarchy- psychological needs that
provide food, security, shelter, and basic needs, safety and security needs that provides salary
and wages, love and belongingness needs that provides bond and domestic, self-esteem needs
that provides self-assurance and attainment and self-actualization needs that provides morality,
creativity, acceptance and inner potential. Starbucks fulfil all the needs of the employees and the
employees are satisfied with the job. Therefore, this theory is a perfect fit.
Recommendations
Starbucks is a famous international coffee product which is expanding worldwide. From the
above analysis, there are certain recommendations which the company should inherit for the

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better growth in the business.Starbucks should provide its services for the poor people also.
Coffee at Starbucks is very expensive and cannot be afforded by everyone.Also, the number of
shareholders should be increased for the business expansion. Along with this, company should
find more eco-friendly solutions to produce the coffee.
Controls to Evaluate the Progress
Every organization evaluates its progress and to monitor the progress of the business. There are
three types of controls- Feedforward Control, Concurrent Control and Feedback Control.
Feedforward eliminates all the possible errors that can occur before the activity is performed.
Concurrent Control helps is resolving the problems helps in resolving the problems while the
activity is performed(Ismail, et.al, 2017). Feedback Control is practised where feedbacks from
the customers are taken to improve the activity performed.Here, Starbucks is using the Feedback
Control where reviews about the coffee are taken from the customers (Ismail, et.al, 2017).
Conclusion
In this report, the discussion was about the famous international coffee brand Starbucks. During
this report, SWOT analysis was done on the company. Also, the discussion was about the
environmental constraints of Starbucks. Further, the discussion was about the organizational
structure and design and the shareholders of the company. Maslow theory of motivation is also
discussed in the report in accordance with the Starbucks. In the end, recommendations are given
to improve the services of the Starbucks.

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References
Holleman, L., Lawson, A., Pincotti, G., Pellichino, R. (2013). Starbucks Industry Profile and
Organization Analysis.Spring.1(1). PP. 1-107.
Ismail, T., Bukhori, A. (2017).The Role of Feedback and Feed Forward Control System to
Improve Competitive Advantage of SMEs in Indonesia.European Research Studies Journal 1
(10). PP. 499-506.
Rego, M. (2018). The Top 4 Starbucks Shareholders (SBUX).[Online].Investopedia.Available
at- https://www.investopedia.com/articles/insights/052416/top-4-starbucks-shareholders-
sbux.asp [Accessed on 7th August, 2019].
Smithson, N. (2017). Starbucks Coffee PESTEL/PESTLE Analysis & Recommendations
[Online].Panmore.Available at- http://panmore.com/starbucks-coffee-pestel-pestle-analysis-
recommendations [Accessed on 7th August, 2019].
Starbucks, (2019).About Starbucks.[Online].Starbucks.Available at- http://www.starbucks.in/
[Accessed on 7th August, 2019].