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December 4, 2017
The Starbucks Company has transformed into a fast-pace coffee outlet focused on
serving quick products and minimizing time between each customer interaction. There
are three problems that have been recognized during the case analysis to be the
underlining issue for the coffee company. The management team is the guiding force
behind executive decisions that are meant to be beneficial to the company but overall the
leadership team has forgotten the mission and values of the original Starbucks brand. The
original mission statement and guiding principles have be overlooked as years proceeded,
and the focus of the company has shifted to mass production of new locations rather then
grooming existing locations for inclusive customer satisfaction and brand loyalty.
The vision for the Starbucks brand, when bought by Howard Schultz and Dave
Olsen in August of 1987, was to bring the romance of Italian coffee bars to America. The
partnership between Dave Olsen and Howard Schultz fueled the combination of planning
for growth and ensuring the best quality coffee and service through employee training.
The original statement by Howard Schultz after obtaining Starbucks focused on the
reassurance to the existing employees of his commitment and loyalty to protect their
personal interests during their continued service. Schultz believed the underlying cause of
quality service was from the motivated and skilled workforce as he stated, satisfied
premier purveyor of the finest coffee in the world while maintaining our uncompromising
principles as we grow. As the company highlighted six guiding principles used to help
make decisions, number three of the guidelines has began to be overlooked by the
management team. Number three states apply the highest standards of excellence to the
purchasing, roasting, and fresh delivery of our coffee. Today Starbucks offers coffee,
the Starbucks Card. In retail segments the company is selling ice cream, teas, CDs,
books, and other lifestyle products. Another feature in the new store locations is the
option to buy breakfast sandwiches or other foods thus overpowering the smell of fresh
coffee and replacing it with food. Not only is there food being served to consumers in the
locations but also a new strategy to complete orders at an increased rate. To ensure quick
pace service and completion of the increased volume of coffee requests, there was a
transition from grinded coffee beans to pre-grinded beans. This company decision was
established to complete orders at a faster rate thus limiting the interaction between
baristas and customers. There is a misconnection between the principles that are the main
pillars for the company and its deciding factors that are meant to better its brand. The
leadership team moves towards expanding in other industry segments rather than
In 2000 Howard Schultz shifted from CEO to chief global strategist and in 2002
Jim Donald became the new CEO following the retirement of Orin Smith. At the end of
2007 there were a total of 15,011 stores with 2,571 that were opened in 2007 alone. The
sales growth projected for 2008 was expected to fall between three and five percent as the
company prepares to see a recession in the United State but in comparison a projected
growth internationally. As well the company created partnerships with Host Marriott and
Aramark that have enabled the distribution and sales of the product in schools and
airports. A bottle version is being sold in grocery stores through the North American
Coffee Partnership, a joint venture between Starbucks and PepsiCo. Thus enabling
consumers the ability to skip the need to go to Starbucks locations for the coffee products
and instead providing access to the products in outside locations. This alteration to the
accessibility of the products has diminished the brand as a coffee experience to instead a
single product. Starbucks charges approximately $3.95 for a small caramel macchiato
while in comparison McDonalds sells the same drink for $1.98. The target market that
Starbucks is catering their product towards is the consumer that wants to purchase both
the coffee and the experience. The target market that McDonalds caters towards is a
quick pace consumer that wants their coffee and to be on their way. In order to continue
charging inflated prices for their product Starbucks needs to rebuild the bridge between
consumer coffee experiences and the store locations. The original CEO, Howard Schultz,
was not primarily focused on the growth within the national market of the US but rather
his worry was fixated on how do we maintain our culture, our intimacy with the
customers?
Starbucks coffee brand is known all over the world for its iconic logo, concept,
and reputation for a quality product and service. Harnessing the prominent features that
make up the DNA of the Starbucks brand is the solution to maintaining the culture and
intimacy with the customers. At the same time the dominance of a Starbucks culture will
help expand its brand to a broader international market. The company partnered with
other companies to make specific music, books, and film that are featured inside only the
store locations. Strategic relationships with Apple and AT&T are helping enhance the
customer experience through the use of Wi-Fi and other in-store technology. Through
these updates done by the company for the thousands of locations already in existence it
As well, the company can update their facilities to provide an intimate setting but
in a modern fashion. New dcor that can be featured in Starbucks will pay tribute to the
roots of the brand such as woven bags of fresh coffee beans. This new feature will
provide both the esthetic and the aroma of constant brewing coffee within the coffee
shop. In addition the locations can transition back from more space for stanchions and
their beverages inside the shops. The Starbucks locations in the immediate area around
Stockton University has limited sitting room such as four tables in the Galloway
shopping center location and five tables in the Mays Landing shopping center location.
This makes it difficult to find seating for customers and forces people to enjoy the coffee
inside their vehicles. Ensuring the company transitions from desiring a large quantity of
customers towards quality customers will rebuild the brand loyalty that customers will
takes trained, motivated employees to deliver both the product and the service.
Eliminating the outlets within hotels and schools that are not monitored by the same strict
standards of company-operated locations and licensed locations will limit the dilution of
the brand. Focusing on the practices of training baristas to appreciate the company as
their own as well as recognizing that management cares about feedback, this will
influence the employees to care about the success of the company too. Howard Schultz
connection with out customerswe have a competitive advantage over classic brands in
that every day we touch and interact with our customers directly. Our product is not
sitting on a supermarket shelf like a can of soda. Our people have done a wonderful job
of knowing your drink, your name, and your kids names. This statement has become
incorrect over time as employees of hotels and schools are employed by the specific
institutions and uninterested in the overall welfare of the Starbucks brand. Breaking this
cycle by stressing the importance of employee responsibility for the welfare of the brand
will again drive employees to provide quality interactions and service thus driving the
The agenda of Howard Schultz as the reappointed CEO in 2008 addressed the
focus on reigniting the emotional attachment with customers and restoring the
connections customers have with Starbucks coffee, brand, people, and stores. The focus
of the coffee experience has been diluted due to the replacement of tables with stanchions
for customers. The concept of interacting with a barista and watching the coffee grinding
process has been substituted for quick service. Customers can trade the name and inflated
prices of the Starbucks coffee instead for a McDonalds name and deflated price.
Starbucks originally was created for the experience between customers and employees
but has side stepped into the realm of profits through mass sales. Reverting back to the
locations as Italian coffee shops and intimate settings to enjoy coffee while
accomplishing work tasks should be the main priority in order to cultivate the once coffee
culture.
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