Starbucks Case

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Starbucks Corporation: The New S-Curve Case Study
Caio T. Leite
Johnson University TN & FL
BUSN 4023: Organizational Strategy & Policy
Dr. John Stricklen
March 24, 2021
 Starbucks Case Study
 The Starbucks coffee chain has today the spot of most popular and successful coffee company in the world, and has become a brand that goes way further than just coffee, as it offers a unique experience for customers. However, by analyzing and breaking down their case study “Starbucks Corporation: The New S-Curves”, we find out that the company’s path to success wasn’t easy, as the organization has gone through significant and severe turbulences and changes in the past, which played an relevant effect in shaping Starbucks to be what we know today while also being key for the successful development of the organization. Chairman and CEO of Starbucks Howard Schultz, points out to the fact that although Starbucks has been an successful and established company for a while, the organization still is in the early days of its growth and development, and therefore it is key for Starbuck to maintain a strategic mindset moving forward, as the market is constantly changing and new challenges arise for the company. 
 The case study tells us how Starbucks went through what they put as an “painful three-year transformation agenda” until the end of fiscal year (FY) 2010, and during this period the company closed more than 900 stores, terminated 18,700 jobs, replaced their senior leadership team, and implemented new Lean store practices to achieve operational excellence, which were all significant changes that had put Starbucks in a very delicate position as they moved forward, and because of the decrease in its stock value and uncertain future, it was necessary for the company to come up and implement a plan that would put the company back on track and to continue to growth and be successful. From that point, Starbucks started to seek to provide the best experience provided to the customer through the culture of coffee consumption. This strategy was related to three specific elements: excellence in coffee quality, the service offered to the customer and the environment of the store. As part of this strategy, Starbucks would permanently monitor its chain of suppliers and distributors, in order to guarantee excellence in the quality of the coffee used in its drinks. The second key element of Starbucks' strategy was associated with the service that they would offer, as the company valued proximity in its relationship with the customer, with the goal of offering a personalized experience, in terms of service and products. The environment of Starbucks coffee shops is considered part essential part of the company's strategy, and through a sophisticated environment, they were capable of generating an inviting and pleasant atmosphere to the customer, and many of their decisions ended up boosting their brand awareness and generating customer loyalty by enhancing customer service and convenience, and the case study notes how the digital innovations implemented by Starbucks such as free high-speed Wi-Fi and mobile payments were able to provide a unique and differentiated experience and retaining the customer the most.
 Despite the fact that the company was able to successfully recover from a challenging period of change, still the question remained whether the company could consistently maintain this phase of rapid growth in a manner that would not result in another financial crisis and affect material shareholder value. Starbucks therefore, had to evaluate the potential risks and opportunities of another potentially aggressive growth implosion, and as they entered this new phase, the company had to pursue other diverse products and channels, in a strategic way that would not damage their image of a core coffee business, as well as relying on their internal growth system and organizational environment that would support this new surge and preserve the differentiating essence of Starbucks. The distribution channels for Starbucks products contributed positively to the company's consolidation process in their market segment, as well as to its expansion. One important factor in Starbucks’ customer satisfaction appears to have come from the fact that the company started to dedicate a money and attention to the analysis of the researches that would identify customer needs and preferences, and through this strategy many significant discoveries were made, and the product mix offered in each stores continued to cause an increase in their revenue. From the beginning, Starbucks pushed a strategy that focused on the customer,and through the coffee culture became part of people's daily lives, by delivering a unique and differentiated experience for each customer. This strategy of focusing on the relationship with the customer allowed the company to develop the ideal service structure, as well as successfully implementing differentiated products to attract and retain its customers. Innovation in products and services, associated with strategic partnerships with third parties, also contributed significantly to the growth and development of its store network and its market expansion. 
 To conclude, although Starbucks is pretty consolidated as a company and brand in the market, their push on a global expansion of the brand can bring many new challenges and risks as they move forward. The company’s focus on the customer, which has been the foundation and has guided the company throughout its years, appears to be slowly being unconsciously replaced by Starbucks’ interest in going global and opening new stores. This strategy has proved itself to be worthy for the company, as we learn from the case that in India they have earned the title of fastest-growing market in Starbucks history, and not only in Asia but in other parts of the world Starbucks has been establishing itself and becoming a reference in the coffee market segment, however they should heavily consider the threats and barriers that this expansion presents, so they can therefore successfully and smoothly continue to be profitable all around. It appears that Starbucks did not consider the changes in the profile and needs of its customers, and despite the fact that the brand is strong enough and is recognized in a way that allows them to easily reach customer acceptance in new segments, there are risks that could affect its future profitability and market share. The best option for Starbucks’ future appears to be the need of a constant strategic plan moving forward, and it can be said that the formulation of a strategic business plan was and still is one of the foundations of the company's success. That being said, it is essential for them to consider how they could potentially waste resources if diversification goes wrong, as if in the case of newly added products in the menu can't satisfy customers, and as they grow and expand it becomes harder to keep track of all different needs and wants from each market, and this can affect the overall brand value of Starbucks. A strong option that could avoid that to happen, could be to implement more regional based products to their menus around their many stores, which would eventually attract new potential target customers that may not be interested or attracted by their common products, and the same can work for their store environment. If Starbucks becomes able to still make use of their core business values and keep giving high emphasis to the same strategic mindset that has helped them recover and got them soaring again when needed, the future of the organization becomes limitless.
References
Michael A. Hitt et al., Cengage (2020) Strategic Management: Competitiveness & Globalization: Concepts & Cases. Starbucks Corporation: The New S-Curve Case Study. 
Geereddy , Nithin. (2021, April 14) Strategic Analysis Of Starbucks Corporation. scholar.harvard.edu/files/nithingeereddy/files/starbucks_case_analysis.pdf.