Review_of_Starbucks_as_a_Business_Organization

Task 1 Starbucks:- Starbucks, named after the first companion in Herman Melville's Moby Dick, was established in 1971 at Seattle's Pike market by three atypical entrepreneurs, Gordon Bowker, Jerry Baldwin, and Zev Siegl. Starbucks objective is to "inspire and develop the human spirit-- one person, one cup, and one neighborhood at a time." Starbucks buys and roasts high-quality coffee and offers it along with fresh, rich-brewed, a variety of pastries and confections, and coffee-related accessories. The Organization's objective is to establish Starbucks as the most recognized and well known brand in the world and company has tremendous success in recent times as well (Solomon, 2012). 1.1:- State the mission, vision, objectives, goals and core competences of your chosen Organization Mission:- To inspire and nurture the human spirit- one person, one cup and one neighbourhood at a time ” (Solomon, 2012). Vision:  Establish Starbucks as the premium provider of the finest coffee in th whole world while maintaining our uncompromising principles while we grow (Solomon, 2012). Objectives:- Starbucks have following objectives:- Make sure 100% of coffee is legally procured by 2015. Helping small-scale farm owners to flourish now and in the future. Implement recycle containers right in front side of company possessed shops by 2015. Serve 25% of the drinks made in shops in recyclable cups by 2015. Starbucks goals:- The company has a goal to open 1000 new stores in the next few years (Winer and Dhar, 2010). Core competencies:- Starbucks primary capabilities are its relentless focus on quality, excellent client support, ongoing product progression, care for its workers, and its drive to be "everywhere (Solomon, 2012)." 1.2 Describe three issues involved in strategic planning in your chosen organization Starbucks identifies the major ideal issues involved as protection of coffee gardeners to achieve future supply, keep the brand picture and remain impressive, new market technique, authority and lifestyle (Winer and Dhar, 2010). 1.3 Select two different planning techniques which you could apply to your chosen organization Planning is a critical issue for every organization, so every organization want solid plan for success. For Starbucks, BCG and stakeholder mapping is two techniques which are suitable (Winer and Dhar, 2010). Task 2 2.1 Select an organisational audit for your chosen organisation. Strength: The major strength of Starbucks is from a client and is very pleased with the flavor and quality of coffee. The company operates a product of great nature and businesses are in good financial shape. The company looks for to flourish its pace and started in several shops in the United States. Brand attention also helps the company is effective, the durability of Starbucks in places that are practical as shopping malls, etc. Collection has things to look for. Powerful objective and moral principles of the company has an authority part in the surroundings in all aspects of the company (Stanley and Konrath, 2012). Weaknesses: Starbucks has a popularity the development and development of new items, but now with time. Prices in contrast to opponents are large and managing costs are high. The company earnings are reliant on coffee items. After less control over the functions outside the USA is the biggest weak point (Stanley and Konrath, 2012). Opportunity: Starbucks is having a too good popularity in the marketplaces to take the possibilities in business. The variation of products is different types like whole grain revenue in markets, the access of the companies in worldwide marketplaces such as Bangladesh, Pakistan and Indian. A coffee house co-brand with various food producers (Morse, 2009). Threats: The economic downturn in the present can impact sales in the worldwide market could also cause a risk. Opponents are higher in creating nations, price changes can be a risk to Starbucks. Starbucks have been selected the subject because the company has more ideal programs and research performed revealed that the company was effective in its business marketplaces (Moehlman, 2010). 2.2 Select an environmental audit for your chosen organisation. Political Industry-specific guidelines and regulations The stage of connections between USA and nations that generate coffee beans. The stage of governmental balance within a country Economic Purchasing energy of consumers Local forex rates Local economy within each industry in Starbucks operates Taxation level of the country. Social Consumer preferences Changing work patterns Changes in way of life of population The stage to train and learning of inhabitants in regional markets Changing principles among population Technological Emergence of latest technology Biotechnological developments Developments in agriculture Environmental Ecological guidelines and regulations Environmental mishaps in nations generating coffee beans Climatic change and other environmental problems in a international level Legal Release of guidelines and rules by health regulators about caffeinated drinks development and consumption Introduction of difficult traditions and business regulations Licensing rules related to the market (Moehlman, 2010). 2.3 Explain why the a) stakeholder analysis and b) strategic positioning are important within your chosen organisation. Stakeholder analysis Stakeholders signify different groups with interested passions in a company's functions, such as workers, supervisors, selected board members, users or customers and areas. Examining the needs of stakeholders and being tuned in to them helps companies like Starbucks to achieve their ideal goals (Stanley and Konrath, 2012). Strategic positioning Identifying the ideal placement of company like Starbucks is a key phase in creating its go-to-market technique and putting it on the direction to achievements. Strategic placement includes obvious options that a company like Starbucks will have to create (Morse, 2009). Task 3 3.1 Describe how your chosen organization could undertake the following strategies: a) market entry, b) substantive growth, c ) limited growth and d) disinvestment Define the strategies and portray how they are implemented within your chosen organization. You should mention a market entry strategy, for example, organic growth, growth by merger or acquisition or strategic alliances. Substantive growth strategies can include related and unrelated diversification. Limited growth strategies include strategies such as market penetration and market development. Disinvestment strategies include turnaround strategies, divestment and liquidation. • Market entry Market entry strategy is a plan or method that outlines how company will deliver or introduce goods as well as its services to the target market and distribute its goods and services to them. Starbucks is in desirable position and is making expansion in global market by introducing its products different corner of the world. According to the chairman & Chief Global Strategist, Howard Schultz in 2003, “internationally, we are at the early stage of the growth”. Currently, it has 18,000 stores and it is in 62 countries around the world. Now Starbuck is adapting the organic strategy to give its shareholders satisfaction with great increase in sale of $214.3 in China and Asia. Now Starbuck is deciding to make the China its 2nd largest market after 2013. To introduce, its product in new market, Starbucks and its partnership companies developed the strategic alliances to get mutual benefits like in 2006, Starbuck formulated the product Strategic alliances with NCAAP to expand their brands and gain the mutual goal (Peter And Donelly, 2008). Substantive growth Substantive growth strategy is used to get more and more market shares and enhance the share holder’s equity even at the cost of short run earnings. Starbucks has been succeeded to getting more market shares by implementing substantive growth strategy. According to CEO of Starbucks, quality has value and no company can make growth in market without quality and if customers see any uncertainty in Product Company remain unsuccessful in earning marketing shares and growth. Starbucks has maintained its quality and made great expansion with the successful implementation of substantive growth especially with diversification strategy. Starbuck has formed the strategic alliances to implement the diversification strategy. Strategic alliance gave starbucks a synergy to dominant the market by minimizing risk and increasing profitability (Kotler, 2002). Starbucks introduced its product successfully in the market with the related diversification strategy. It introduced the coffee flavor ice-cream with dreyers and coffee beverage as ready to drink as Pepsi cola or coca cola. Likely, starbucks successfully introduced unrelated diversification by giving them pleasant, light music environment with its refreshment products like coffee, ice-cream and sandwiches (Peter and Donelly, 2008). • Limited growth Starbucks has also implemented the limited growth strategy to avoid more risk. The limited growth strategy works like smarter strategy with low risk options. But it has some limitations too. It do no alternative is very dangerous strategy in which company do nothing when a change is required. While the Starbucks has made change with time, and timing is very successful strategy. Some of internal growth strategies are market development and market penetration. Starbucks make efforts to adopt the market penetration by increasing its sales and enhancing the market shares. Marketing Penetration strategy is very much defensive strategy and Starbuck need efforts to increase its market shares and earn profitability. Starbuck is leading with special products like bean coffee that has great identity in international markets. Product development has played very important role in the success of any company. It is not a process of altering a product instead it means to understand the needs and wants of the customers. Its developed R&D experts are trying hard to maintain its quality and introduce new flavors with new product lines according to the customers need and want (Marshal and Johnston, 2009). • Disinvestment Disinvestment strategies are plan to cut-rate sale of particular assets like subsidiary, manufacturing plant, or any product line. This process is also used to fulfill the need to initiate elimination in capital. Starbucks failed in many of its products so it used to the disinvestment strategy so that it could meet its long term goals and improve its financial position. At that time of crises, high end products, Starbucks close this four-bucks products to halt its decline and afterward due to turnaround strategy, Starbucks significantly decreased the prices to enhance the sales. Cost cutting enhance the efficiencies and margins as well. Goldman Sachs, an analyst said that Starbucks seem to be taking right step to maintain its competitive position (Hyman and Sierra, 2010). 3.2 Predict an appropriate future strategy for your chosen organization. Your future strategy should not be one of the strategies you proposed in answer to task 3.1. According to my opinion, market development is most appropriate future strategy because Starbucks has potential to extend its product line with differentiation products and services. This can also extend its network into other geographical regions and increase its market shares (Hyman and Sierra, 2010). Task 4 4.1 Convert strategic plans into operational reality in your chosen organization: You should explain how you would implement your strategic plan. This includes a discussion about the activities, a discussion about the teams you require and examples of individual roles required to achieve the SMART objectives within the strategic plan. Also mention the link between the collective roles. Strategic plan is a management tool that generally defined plan that aimed to help an organization to operate bitterly and get the desired future. It is legally valid road map that is made to describe how Starbucks, our selected company executes the strategy. It is long term plans that articulate the mission statement of the starbucks company. Implementation of strategic plan is the main process of convert the strategy into plan that puts into actions so that strategic objectives can be achieved. Putting the strategic plan into action is more essential than of your strategy. Converting the strategic plan into operational reality requires a lot of other planning too like managing staff, allocating organizational resources and put the right people at right place according to their capability (Kotler and Armstrong, 2012). The implementation of strategic or bring the strategic into operational realties, Starbucks have to bring changes into the company by answering these 4 w (Where, When, Why, What) and h (how). Starbucks requires the manpower and calls them partners not employees. To successfully implementing the plan starbucks should integrate the operations according to their time span and arranged the meeting schedule, deliverable results and planning according to time limit. Sufficient allowances and other spaces should not be ignored to give mental relief of employees by giving them different incentive and invite them to participate in the activities of jobs. After successfully implemented the plan starbucks will be able to achieve its SMART (Specific, Measureable, Attainable, realistic and timed) objectives (Hyman and Sierra, 2010). For example Profitability Objectives Starbucks should be able to get required percent return on its employed capital till 2015 2. Market Share Objectives Able to gain 45 % market shares for its unmatchable coffee products in other markets till 2016 3. Promotional Objectives With advertisements and other activities, Starbucks would be able to create awareness of quality products and its other product line and promote products in different regions of the world. 4. Survival Objective Survive its current and present double-dip recession. 5. Growth Objective Increase its operations to get more revenue and sustain its growth. 6. Branding objectives Increases its brand with quality (Hedin et al, 2011). 4.2 Identify resource requirements you would need to implement a new strategy within your chosen organisation. You should mention the resources required; this includes human and financial resources. To implement a new strategy To implement a strategic plan, Starbucks need a lot of resources like financial and human. No any organization works until it has enough manpower along with financial recourses. To get more markets and other geographical regions company need a approval of finance and budgets. Great budget is required for a complete setup. The appointments of change agents as head of the departments are essential to run the business. Suitable resources must be acquired and managed and these resources are finance, technology, time, and especially human resources. With the sufficient resources, best planned and implemented plan will not give the fruitful outcomes (Kotler and Armstrong, 2012). 4.3 Select a strategy (e.g. growth by acquisition) used by your chosen organisation and proposes targets and timescales which you would use to monitor its implementation. You are required to present your answer in a Gantt Chart. Please see attached Gantt chart for the same. TASK 5 MERIT TASK Explain how environmental factors such as use of PESTEL and competitor behaviour have impacted on your chosen organisation over the last three years. Understanding impact of environmental factors on Starbucks through PESTEL and Competitor behavior. For our chosen organization Starbucks, let us first undertake a PESTEL analysis to understand its impact on Starbucks. The PESTEL analysis will help us understand the external factors outside Starbucks that have a direct impact on this company and which it needs to take care of. Political: Being a well known multinational organization, there are a number of political issues that Starbucks has to face. Trade with other countries: While doing trade across the border, Starbucks gets predominantly gets effected by trade issues. This can happen in a way when the other country's government levy tariff and duties on inter-country trades, it leads towards not only to a decrease in the overall profitability of Starbucks but also a huge portion of its income gets transferred in paying such tariffs that become a reason for inconsistency with the equity. Impact of Specific instances: With reference to the international trade situation after 9/11 incident, the trade relations of Starbucks have also effected with other countries. Taxation related issues: The high tax rate imposed on farmers belonging to those countries from which Starbucks imports the coffee from, leads to a higher purchasing cost of raw material for Starbucks. Any fluctuation that is caused in taxation rates is ultimately translated in the form of a high price of products for the final consumer. This can lead to a decrease in sales too. Political stability of other countries: In the backdrop of political conditions, Starbucks must investigate the political stability of the countries where it wants to expand its business to. Starbucks must remain very cautious while entering into a relationship with those countries that are suffering from a political turmoil. Moreover it should also be considered that due to political instability, the governments can change and with a change in governments the taxation rates and legislations regarding foreign trades may also undergo a change. Licensing and permit cost: Another political factor pertains to the licensing and permit cost. Like any other cost associated with the Starbucks business it will have an ultimate impact on the final consumer's pocket. Since a decrease in such costs will lead to a decrease in overall production cost for the company (Hyman and Sierra, 2010). 2. Economic: Following are the key economic factors that impact Starbucks as an organization; Fluctuation in interest rates and : In case there is an upward trend in the interest rates, Starbucks can have less investment and expansion incentives, which will lead towards a falling sales and less amount available for the suppliers. Mortgages repayment trends in economy: If there are more mortgage repayment trends in US economy, it will create a less disposable income available with the consumers for spending on luxury items like coffee. Unemployment Issues: Since the unemployment issues are increasing in US economy, it is leading towards a lower disposable amount available with the consumers to be spent on luxury items like Starbuck coffee. So it can again impact the organization directly or indirectly. Local currency exchange rates: With a fluctuation in the dollar rates, decline in own currency rates or appreciation in other country's exchange rates can cause a significant impact on the profitability and operations of Starbucks. Likewise, the taxation rates, economic environment and buying power of other countries where Starbucks is having business also effects the organization (Kotler and Armstrong, 2012). 3. Social: Like any other business concern, Starbucks also gets impacted by the social factors in the following way; ➢ Due to an increased double shifts and dual jobs trends, the people are preferring taking coffee to keep themselves actives. ➢ The Changing family patterns in USA and Europe can impact the coffee usage frequency too. ➢ Consumer preferences are changing which can also impact their buying pattern on luxury items ➢ Work patterns Changes are brining changes in the lifestyles of population ➢ The level of education of population in local markets Changing values among population, they are now more conscious about health issues and may curtail their spending on items like coffee (Morse, 2009). Technological: Since the technology plays a vital role in creating a competitive advantage for any organization, following technological impact Starbucks. ➢ The emergence of new technologies and method of production play a great role in reducing the cost of production for Starbucks. ➢ Biotechnological developments also impact Starbucks ➢ Significant developments in the field of agriculture can help get mor row material at lesser price. ➢ Starbucks Cards are a unique example of sufficiently good technological developments made by Starbucks (Winer and Dhar, 2010). Environmental Today every country and particularly the environmental departments are making great stress on production not at the cost of environmental issues. Starbucks is directly associated with environment since it is production concern. ➢ The Environmental rules and regulations need to be followed to ensure no emission of toxic gases ➢ Government levy high tax rates on coffee producing companies, since there have been environmental disasters in countries producing coffee beans ➢ Global warming and other environmental issues in a global level can also have a direct impact on Starbucks (Hyman and Sierra, 2010). Legal Finally, the legal issues are also a great challenge that Starbucks has to face, they are; ➢ With introduction of policies and regulations by health authorities about caffeine production and consumption, Starbucks has to place and position its products so as to avoid its negative image in the eye of its consumers. ➢ Also through introduction of high customs and trade regulations Licensing regulations relating to the very industry, it is once again aimed at discouraging caffeine consumption which is a huge challenge for Starbucks to face (Hyman and Sierra, 2010). Starbuck's Competitor Behavior With reference to the major competitors with in the same industry, Starbucks is faced with key competitors like McDonald's , Costa, Dunkin Doughnuts and Caribou Coffee along with several other small competitors like coffee shops and cafes. While analyzing the competitor behavior of Starbucks, following observations are being made; ➢ The major competitors like McDonald's and Dunkin Doughnuts have expanded globally, so as to increase their global market share ➢ Theses competitors are not fully relying on a single product, rather a number of items are being included in their menu cards. ➢ Caribou Coffee brought its prices to the level of Starbucks since they are both dealing in the same product line. This increased the bargaining power of Starbucks clients since they had a substitute available in the same market. ➢ A key competitor named as Costa employed the same suppliers as that of Starbucks, which again raised the bargaining power of Suppliers (Peter and Donelly, 2008). Below is given the important figures of Starbucks competitor's financial statements in comparison with Starbucks. | |Starbucks Corp. |Casto |Dunkin |Caribou Coffee |McDonald's Corp. | | | | |Doughnuts | | | |Industry |Travel & Leisure |Travel & |Travel & |Travel & Leisure|Travel & Leisure | | | |Leisure |Leisure | | | |Current Share Price |58.12 |61.98 |32.72 |49.9 |101.5 | |Market Value |$43,309 mil |$11,650 mil |$7,075 mil |$6,561 mil |$101,703 mil | |Revenues |$13,300 mil |$6,321 mil |$7,688 mil |$7,999 mil |$27,567 mil | |Net Earnings |$1,385 mil |$470 mil |$18 mil |$477 mil |$5,465 mil | |5-yr Sales Growth |5.62% |1.40% |3.54% |4.14% |3.44% | |5-yr Earnings Growth |64.17% |12.08% |-19.38% |7.46% |8.46% | |Net Profit Margin |10.49% |7.44% |0.24% |5.18% |19.82% | |Short Interest |1.78 |2.59 |2.93 |4.37 |2.72 | |Proj. Long-Term EPS Growth (%) |20.72% |9.40% |21.47% |-3.20% |9.30% | |Forward P/E |26.76 |22.69 |13.28 |15.99 |17.52 | |PEG |1.29 |2.12 |1.01 |1.65 |1.86 | |Price/Sales |3.16 |1.84 |0.92 |0.79 |3.72 | Source: Kotler and Armstrong, 2012 b) How has your chosen organisation responded to these factors at a strategic level' M1 Identify and apply strategies to find appropriate solutions, by using complex problems with more than one variable have been explored For the sake of reaching the actual variables that are responsible for creating issues for Starbucks, a theocratical framework was created, which helped bring them down and then deduct from them the most important ones. From the research conducted, the main variables found that are and can be a potential reason for creating further issues for Starbucks are; ➢ a fierce competition from its key competitors ➢ A declining or stagnant client base due to changing demographic trends ➢ Govt regulations and taxes that are causing an increase in the total cost of Starbucks and thus reducing profitability (Cialdini, 2006). In response to these issues ➢ Better or competitive prices need to be offered with reference to its competitors. ➢ A backward integration strategy need to be applied by having own coffee farms in other countries, so as to reduce raw material cost ➢ Better placement of product is required ➢ Special attention needs to be paid towards the host country or where it is planning to expand, keeping in view the taxation, legislation and political conditions in those countries (Cialdini, 2006). M2 Select/design and apply appropriate methods/techniques, by using a range of sources of information For the sake of collection of data desired for undertaking analysis of Starbucks, various techniques have been used to collect information from a number of sources. These sources included; ➢ Case studies available on Starbucks as an organization ➢ Trade Journals ➢ Company's own website ➢ Competitor analysis ➢ Company's Annual report. A more concentration was placed on secondary data that was collected from the above mentioned source where a deductive approach was followed. Both qualitative and quantitative data was collected (Peter and Donelly, 2008). M3 Present and communicate appropriate findings by using an appropriate structure and approach How Starbucks responded to these factors at a strategic level Starbucks adopted the following strategies for addressing these issues; ➢ A more focused approach was being made by reaching the more sophisticated customers, who use coffee and take it as an inevitable part of their life. This could be done with an aggressive marketing campaign through various medias like tv, internet, magazines and even through direct selling. ➢ A strong Competitive analysis is being carried out, where in Starbucks understood the attributes that are giving them competitive edge, what are its own Strengths and opportunities and what are that of its competitors. This helped it improve the pricing factors and marketing and overall establishment issues. ➢ Starbucks engaged itself with those suppliers and coffee farmers living in relatively poor countries, who can supply them coffee at lower rates, this helped it raise its profit margins through reducing costs. ➢ Again contract with other countries were revised by reviewing their demographics and also the political and economic conditions prevailing in those countries (Cialdini, 2006). DISTINCTION TASK Critically evaluate effectiveness of the strategic planning process within your chosen organisation in achieving its strategic aims and objectives over the last three years. From Starbucks' Strategic planning one can well understand that successful organizations use strategic initiative and strategic plans formulated by decision about its people, strategy, its execution, the cash to build profits, while maximizing time savings. Keeping in view the issues Starbucks was facing the organization took initiatives for achieving the status of a responsible company through earning trust and respect with ethical sourcing, environmental stewardship, and also community involvement in their company profile. Since the last three years, under ethical sourcing, Starbucks outlines the goal that by year 2015 the organization will use coffee that is only obtained by the use of ethical trading and responsible growing. With respect to environmental stewardships, Starbucks is striving hard to attain the goal of having each of the coffee cups used to serve customers as reusable or recyclable by the end of year 2015 so as to reduce the carbon footprint the organization has on the environment (Kotler and Armstrong, 2012). Thirdly, Starbucks community involvement goal is that by the end of 2015 the organization will provide neighborly assistance to community of the stores and growing areas too by contribution of a minimum of one million volunteer hours yearly to change, inspire and make a difference in the lives of all people. Thus Starbucks' strategy does not only revolves around the organization itself but around the well being of the community too. Before going into the detail of the effectiveness of Starbuck's strategic planning process, lets have a bird eye view of the strategic aims and objectives behind this planning; ➢ To attain a competitive advantage over the major competitors though bringing proprietary and revolution in the industry by delivering the best cup of brewed coffee available anywhere. ➢ Catering a more sophisticated market segment by providing them a unique coffee experience so as to connect them with the early days of Starbucks. This also pertains to reviving the Starbucks old traditions ➢ Through the introduction of a new state of art, novel ways of brining delight to the customers while reducing own costs so as to create a win win situation. ➢ Extending relationships with the suppliers as a key stakeholder for enhancing Starbucks 37 year commitment to ethically sourcing world's quality and finest coffees worldwide. ➢ Adhering to the rules and policies of US government and also of the other host countries so as to create a long term relationship with them (Winer and Dhar, 2010). In the backdrop of above mentioned strategic aims of Starbucks, it formulated a detailed strategic plan, as mentioned previously. Since it was a strategic plan, that was not made to deliver immediate results. It took considerable time to yield the desired results, however it remained much effective as expected. Let us now evaluate the effectiveness of the strategic planning process. ➢ Since there were massive investments made on implementing the strategic plan, initially, Starbucks income statement showed a rise on the expense side, yet by the end of second year a break-even could be achieved and the third year yield quite sufficient amount of profits. ➢ The strategic plans about strengthening relationship with communities also remained quite successful as it helped bring closer and together the communities with Starbucks that could otherwise never had any good image of a coffee based organization. Even though, this could not raise the client base of Starbucks, yet the goodwill of Starbucks as an environment and community responsible company was definitely raised . ➢ Even though, Starbucks has not successfully implemented its backward integration plan for growing its own coffee farms, yet the company could create good relationships with the coffee farmers residing in far flung areas and other countries. Starbucks could explore those markets and suppliers from whom it could get the raw material at slightly lower prices. ➢ Starbucks adhered to the policies and regulations of government in terms of taxation, legislation and also tariffs, which again raised its image globally as a responsible company. ➢ Starbucks introduced re-usable cups with its own logo, which was indeed a unique idea in contrast to its key competitors. This helped create a product differentiation by Starbucks in comparison to its biggest competitors. ➢ The company also remained successful to bring to table the kind of consumer it wanted to target. Through a better product placement and promotional campaign along with introduction of Starbuck Cards, it successfully tapped sophisticated and corporate clients that helped revive the old Starbucks (Marshal and Johnston, 2009). b) How would you advise your chosen organisation to respond strategically to current changes in its environment and why' D1 Use critical reflection to evaluate own work and justify valid conclusions through the synthesis of ideas. After making a thorough and in-depth analysis of Starbucks, through collection of data from a variety of sources and making own evaluation where required, the following conclusions are being made about Starbucks as an organization in the context of the overall environment, it is operating in; ➢ Cultivating strong relationships with its customers is one of the keys to the success of Starbucks. ➢ At a very high time, when Starbucks smelled some existing and emerging issues, it understood the fact that in order to become a competitive organization in their market there had to be a change in how it did business. And that is why ,the way it managed its business, improved the overall training and knowledge of organizational objectives. ➢ In order to accomplish its strategic aims and objectives, Starbucks had to develop a strategic and financial plan. These plans were aimed to enforce the objectives of the company and ensure fore-casted projections were met. By analyzing the effectiveness of these strategic plans, it can be well understood, that to a great extent, Starbucks remained successful in achieving those objectives. ➢ Starbucks has always took its competitors on war footings, and that is why it came up with novel ideas to gain a competitive advantage in overall industry. ➢ Within a very short span of time the company managed to revive its previous position by building strong relationships with its customers, employees and communities too (Stanley and Konrath, 2012). D2 Take responsibility for managing and organising activities through research and the demonstration of independence and autonomy With reference to my own observation of Starbucks as an organization, it can grow better though making following changes; ➢ By introducing a diverse price range ➢ Introducing new menus that may be similar or better than what its competitor offers. ➢ Some localized products should also be offered. ➢ Make entry in new markets in the form of joint ventures, this will minimize the risk factor associated with entering new markets. ➢ Take Young urban group as its target market. ➢ Starbucks should continue Social media as a medium for reaching potential customers. ➢ Introduction of discount cards especially for students (Hyman and Sierra, 2010). D3 Demonstrate convergent/lateral/creative thinking through problem solving Though Starbucks has once again started operating very well, but it will not be wrong t say that there is always some room for improvement. Through making an analysis of the key competitors of Starbucks and its own business and operational activities, following are given some recommendations, that can help making an even improved situation for Starbucks. ➢ Though Starbucks has doubled in number of stores as it had in 2004, yet the biggest concentration of these stores reside in US markets. This translates its share at about 30% in the international market. To increase its market share in international markets, Starbucks need to expand its network worldwide especially in European and Asian countries where the trend for coffee is increasing. This expansion will raise its client and income base too. Starbucks should expand its global market presence and spread out its profit base to insure a more stable economic base for the company. Expanding its geographic scope will be key to allowing Starbucks to grow as an organization. ➢ Depending on the culture of the various countries, it is operating in, Starbucks need to change its promotional and marketing strategies specific to their cultures. Creating a generic need, making an emotional connection with the product can attract a lot of customer who may not approve of taking coffee as a substitute of tea. ➢ Instead of keeping a uniform price, a diverse price range should be introduced for different class of customer, so that instead of keeping focus on corporate clients only, a diverse customer portfolio should be created. ➢ It is highly suggested that Starbucks should seriously concentrate on a backward integration plan by growing its own farms in those countries where there are lesser taxation and legislation issues for foreign investment (Armstrong and Kotler, 2012). References: Armstrong, G. and Kotler, P. (2012) Marketing: An Introduction. 11th Edition. 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