Essay on Starbucks Management Operation
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According to Jones & Robinson (2012), operations management is the administration of business activities intending to generate higher level of effectiveness within a company. Operations management is mainly concerned with planning, supervising and organising in production and provision of services (HILL & HILL, 2011). Operations management also handles strategic issues experienced in the company (Jones & Robinson, 2012).
The terms ‘manager’ and ‘leader’ are universal; however, people tend to have different definitions based on how they understand (SCHEDLITZKI & EDWARDS, 2014). Some individuals perceive that the terms are similar; as a result, they tend to use them interchangeably (Bolden, 2016). Furthermore, some people may have different perceptions; for instance, one cannot be a good leader and a good manager; this implies that there is a difference between the terms. The terms can be differentiated based on the responsibilities of each individual; for instance, the roles of a leader tend to be different from that of a manager. According to Bolden (2016), a leader has enthusiasm and values creativity in an organisation; conversely, a manager values determination and rational thinking. Based on character traits, a leader is independent, inventive, bold, inspirational and flexible, whereas a manager is authoritative, analytic, sturdy, and consulting (PETTINGER, 2007). Furthermore, leaders influence individuals to follow them, whereas managers make individuals to work for them. Managers are responsible for the comprehension of the management process; besides, the managers also make plans, supervise finance and human resources in an organisation.
According to Bolden (2016), leadership is a process of manipulating people to recognize and concur on what should be done and the means of doing it. Leadership also assist other individuals with shared efforts to achieve common goals. In leadership, one’s personality tends to influence a group of individuals to achieve particular objectives (Bolden, 2016).
According to Mason et al. (2017), Starbucks is a coffee organisation and coffeehouse chain. Most Starbuck houses in the world serve hot and cold drinks and this has attracted many people (Gupta et al., 2018). Starbucks has developed with time; for instance, it offered most excellent and fresh-roasted whole bean coffee (Paryani, 2011). As the company expanded, there was a need to recruit employees with leadership qualities, as this would ensure that the company grows (Gupta et al., 2018). The company has expanded to more than 60 nations whereby it has 23,000 retail stores and about 165,000 employees (Mason et al., 2017). Starbucks is considered to be the leading coffee chain in the world. The company has maintained its brand reputation through the years and attract many customers globally. The business has been able to outshine its competitors as it adheres to Porter’s Differentiation Focus Approach. Through the approach, the company offers products and services to a specific market segment, and it differentiates with unique offerings hence outstanding the quality from its rivals (Gupta et al., 2018).
Managers in Starbucks should assess the possibilities of achieving the company’s goals by concentrating on the company’s SWOT analysis, adjusting organisational culture, and increasing competencies. Besides, the managers also ensure there is an effective management process. Starbucks managers may also take part in the company’s daily operations, whereby they can provide customer service and assists the customers with complaints.
Managers at Starbucks undertake various job duties, for instance, overseeing employees and ensuring there is effective communication between the junior and senior employees (Mason et al., 2017). Furthermore, the managers ensure that the operations are undertaken in the company to follow the given guidelines and adhere to the standards. Starbucks managers can also assist the baristas when they are much needed, more at busy times (Mason et al., 2017). It is the responsibility of managers at Starbucks to ensure that every customer that leaves the coffee shop is satisfied, and he or she will return. A manager in Starbucks also runs a team; as a result, he is expected to know the staff and know the positions that each individual fits.
There are various models of leadership and management, for instance, situational, systems and contingency leadership models.
The leaders and managers tend to control and command the employees based on their capabilities to fulfil the assigned the tasks in various situations; as a result, situational context can be suitable in both macro and micro levels (Meier, 2016). Management and leadership should deal with the changing capabilities of the workers and the nature of jobs as the employees use different approaches to achieve the set goals and the maturity of the job. Job maturity is an indication of one’s capacity to complete the assigned job that has different levels; as a result, it is the responsibility of the leaders or managers to know how a job is tackled in a specific situation (SCHEDLITZKI & EDWARDS, 2014). In situational leadership, the role of leaders and the functions of managers are described by the job maturity subordinates as they are perceived to be the significant situational factors. According to Meier (2016), situational leadership and management describe the roles of leaders and managers on different phases of performing a task. Based on the situational leadership model, each situation tends to require a unique leadership and management style as this enables an individual to deal with a situation at hand and ensure that the goals are achieved (SLACK et al., 2013). In this model, employees are guided on how to do their tasks, and this translates to quality products and services in an organisation; this becomes strength as it enables the company to compete on the market (Meier, 2016). Some situations required more attention from the management than others. The model has four styles that range from directive to supportive behaviour, these include;
Directing is a core leadership style, and it requires the leaders and managers to provide guidance and give a detailed guideline on how the employees should undertake the assigned tasks (Meier, 2016). It is the responsibility of the top management to identify the employees and delegate the work to their attention as this enables them to work on the assigned job and ensure that they deliver quality work. In most large organisations, the top management deals with the managers who are responsible in distributing the work to the workers; as a result, it is the responsibility of the managers to ensure that the work is done in the required manner.
At this situation leaders and managers tell the employees what to do and also guide them on how to undertake the assigned jobs to ensure that it meets the required standards (Meier, 2016). The leaders and managers should also support the employees, more so when undertaking the tasks as they may need guidance. It is the responsibility of the top management to train and show the managers what is required in a particular job and how to undertake it.
The leaders and managers develop supporting habit where they ensure effective communication with the employees and receiving a relevant feedback from the employees however with less direction in the process (Meier, 2016). Furthermore, management should motivate the employees by rewarding them, more so when they perform excellently on the assigned tasks.
In this phase, the top management keep regular checks as this enables them to monitor the progress of the work assigned to the employees. The leadership and management do little in directing and supporting the employees (Meier, 2016). Good leaders and managers try to delegate duties based on the skills of the employees as this enables them to deliver quality work that should meet the required standards.
According to Macdonald et al. (2018), people who design approaches to an entire system to optimize all the company’s entities for steady excellent performance are referred to as systems leaders. Company entities comprise groups, people, business units and the entire company. Systems leaders perceive the system as a whole and act to replicate the broad view of the company. Systems leadership aim is to communicate the vision at all the levels in an organisation. Furthermore the leaders tend to work hard to maintain their peers in the various levels and layers in the company (Macdonald et al., 2018).
Leadership also knows the dynamics at the micro level; for instance, problems affecting workers and how they are feeling while working. An understanding of both micro and macro dynamics enables systems leadership to manage the entire system (SLACK et al., 2013). Starbucks ought to address the issues on the misunderstanding that lowered the company’s performance. Besides, there is a need for the company to calculate productivity and compare it to internal operations (Macdonald et al., 2018). The management in Starbucks check the production processes and output on a regular base, as a result it can assess employee performance. Through the evaluation of the workers and monitoring the production, the company can identify any issues within the process. If it is noted that it is declining, immediate decision making will be necessary for dealing with the issue. Starbucks experienced a financial loss in 2009, and this negatively affected the company (Macdonald et al., 2018). The impediment was due to the crash of the global economy; however, the internal environment in the organisation was not suitable. Through systems leadership, Starbucks has been successful as it ensures that the company has a safe future as it handles issues at the initial stages before developing and altering the company’s operations.
The model also allows the entire organisation to work towards the accomplishment of the goals.
In contingency leadership model, the effectiveness of leadership depends on the adoption of a leader’s style to the appropriate situation. It is the responsibility of a leader to adopt a style that is appropriate to the particular situation (Fiedler, 2015). A leader needs to correct their style to the condition that they face. Fiedler established the contingent model, and it is based on three factors which include;
- Leader‘s power
The factor explains the post that a leader holds in an organisation and the extent to which they persuade the cohorts by motivating them through rewards (Fiedler, 2015).
- Leader-Followers relations
Trust plays an indispensable role in an organisation as it defines the enthusiasm of the cohort and the extent to which they can follow their leader’s command. The relationship that exists between the leader and the team relies on trust (Fiedler, 2015). Once trust is present between the two parties, the followers can undertake the assigned roles and responsibilities.
- Job structure
Job structure describes the degree to which the task is explained as well as the normal guidelines that are necessary to undertake the assigned task on time.
The efficiency of leadership is essential in Starbucks as it helps in recognizing the displeasure of workers more so in important decisions. Through the contingency model, the leaders are required to differ depending on the circumstance as this ensures that the operations in the company are not affected. Lack of interest in the existing situation dealings led to a decline in employee performance in Starbucks New Zealand (Fiedler, 2015). When employee performance decreases, it is the responsibility of the leaders to take immediate decision to change the situation (Fiedler, 2015). A meeting could have resolved the issues experienced by employees in Starbucks; furthermore, the meeting could have kept the employee’s hopes and, in turn, they could have undertaken the assigned tasks with efficiency and goodwill. Many organisations have adopted a contingency model of leadership, and it has been used as an organisational behaviour used in handling worst-case scenarios. One weakness of the contingency model of leadership is that it does not explain why some leaders are more effective in some situations than others (Fiedler, 2015).
In an organisation, operational management processes, inputs and outputs are dynamic aspects that tend to change with time and in different situations. However, it is the duty of an operations manager to ensure that the changes that occur are controlled and planned to achieve the required output (Reid & Sanders, 2019). The operations manager at Starbucks should consider that the supply chain management is working as scheduled, and it delivers the products in time and the necessary cost and quality. It is the task of an operations manager to minimize the communication gap that exists between the departments, and they can work together towards a common goal (Reid & Sanders, 2019). The operations manager identifies the weak areas in the entire supply chain, and this helps in taking the recommended actions to ensure that the performance of the whole operations is effective (SCHEDLITZKI & EDWARDS, 2014). With the aim of improving efficiencies of operation management, the operations manager (OM) should understand the factors that accelerate the overall operations with higher output in Starbucks, for instance, speed, cost, dependability, flexibility and quality (Reid & Sanders, 2019).
Key management approaches
Management by objectives (MBO): Through this approach, the management and employees agree to the goals and understand its roles in the organisation. The application of MBO in Starbucks will ensure that every individual in the company understands the aims of the company and the roles and responsibilities (SLACK et al., 2013). The approach will also ensure that the employees are empowered, and this, in turn, enables them to align their duties to the organisational objectives. When employees meet the corporate goals, they are rewarded; this, in turn, keeps them motivated. Starbucks should apply the MBO approach as it enables it to achieve the goals, and this result in growth.
Smart: The approach enables the management to set clear and motivating goals; furthermore, there should be a connection between the company’s goals and the employee performance targets (SLACK et al., 2013). The SMART approach in Starbucks enables the employees to undertake the assigned duties and ensure that it aligns with the organisation’s goals. Through the approach, the managers at Starbucks should focus on the future and make improvements to the current activities as this enables them to achieve the set goals.
Six Sigma: This approach aims at improving the quality of process outputs as it pinpoints and eradicates the causes of defects. When the approach is used in a company, it results in a reduction in variation in processes (SLACK et al., 2013). Starbucks is a global company as it operates in various parts of the world; as a result, the company needs to achieve the coveted Six Sigma quality certification as this enables it to outshine its rivals. Through the application of Six Sigma, Starbucks will improve customer and employee satisfaction. Through customer satisfaction, Starbucks will attract more new customers.
Total Quality Management: This is a management approach that focuses on quality, and it is based on the participation of the people as they concentrate on long term goals. The approach applies to Starbucks as the company should ensure that high-quality coffee is obtained as this enables it to get high profit due to increased sales (SLACK et al., 2013). Most customers value quality; this implies that when Starbucks produces quality beverages, it expands the customer base. Quality is vital in a business; as a result, there is a need to ensure high-quality products as this enables the company to increase sales. Customer satisfaction enables Starbucks to achieve total quality management; through this, the company will benefit all the employees and society.
KAIZEN: This is an approach that ensures that there is a constant improvement in the quality of products in a company (SLACK et al., 2013). The approach applies to Starbucks since there is a need to make constant improvement of coffee as this also increases the quality standards. Change is inevitable in business; as a result, continuous improvement enables Starbucks to develop and explore the quality of coffee and other beverages.
Lean production: Lean production can be described as a management approach that concentrates on reducing waste and ensures quality (SLACK et al., 2013). The management approach applies to Starbucks as it plays an indispensable role in all the features of a business, which include the production and distribution processes. It is essential to understand what the customer requires; as a result, lean will apply to Starbucks as it enables coffee that meets the customer’s standards to be produced, and this attracts many customers. Lean production has allowed Starbucks to increased quality, speed, and output; as a result, there is a reduction in costs incurred, hence high profit. Over-production of coffee can be a waste in an organisation; as a result, coffee in Starbucks is prepared based on customer demand, and this has minimised wastage (SLACK et al., 2013). Furthermore, Starbucks has utilized simultaneous engineering as a project management approach that has enabled the company to introduce coffee shops in various countries, and increasing its market share by doing so. Through the use of simultaneous engineering, Starbucks has introduced different brands of coffee, such as cappuccino, and it has maintained a high number of customers in more than 60 countries in the world. The staffs in Starbucks in various nations are involved in the business operations; this, in turn, enables the company to have a competitive edge over the rivals.
Internal factors affecting decision making in Starbucks
Decision making is inevitable in an organization since an individual need to make a decision at one point or the other. Starbucks has been in existence for decades; however, many choices have been made at some point, and this contributes to its success. Culture plays a critical role in decision making, as it determines the appropriate decision-making style to be used. Knowing the values and belief that underlie a company’s preferred decision-making style is vital in participating in inter-cultural business interactions. Since Starbucks has coffee shops in different nations, culture is essential in decision making since there are cultural differences in the regions, and this could impact the style to be used.
Employees can influence the behaviors made in Starbucks, for instance, behavioral factors such as values, one’s personality, and propensity for risk tends to affect the decisions that employees make. Employee behavior influences employees to team up, and this can affect the choices that they make or support. Employee behavior ought to be considered in Starbucks as this could influence the decisions made in the organization.
Individual decision making may not be appropriate in a big company like Starbucks; as a result, team decision making is appropriate. All the stakeholders ought to be involved in decision making as this result in various alternative solutions that can be used in establishing a long-lasting solution. Teamwork is vital since people have different ideas, and these could impact the decisions made in an organization. Effective decision making could be achieved through teamwork; as a result, Starbucks should involve employees in decision making, and this improves the company’s operations.
ENVIRONMENTAL FACTORS AFFECTING THE OPERATIONAL MANAGEMENT IN STARBUCKS
Political factors affecting Starbucks
Starbucks experiences various political external factors such as regional integration of markets which offers a chance for Starbucks to develop globally; the management should follow for any support from the government in certain regions, where the infrastructure may have a significant improvement. Investments in business centres, retail parks and stadiums may open new opportunities for the business, and so the management should always be aware (Smithson, 2017).
Economic factors essential to Starbucks
Starbucks experiences various economic factors such as reducing unemployment rates and high economic growth of developing nations; these create opportunities for the organisation to gain more returns from different markets globally (Smithson, 2017). The company also experiences increasing labour cost in suppliers, and this affecting Starbucks as it raises the company’s expenses (Ivanov et al., 2017). The management decisions are heavily affected from such events.
Starbucks has the chance to raise its returns due to the increase in demand for coffee, and this is attributed to the developing coffee culture and middle class globally (Smithson, 2017). Starbucks can develop its healthy products to draw health-conscious customers to various cafes across the world. Also the ongoing trend of working from the café is contributing to the brand success. The management should make sure that the company is making enough efforts to interact with its existing and potential customers.
Technological factors in Starbucks
The management in Starbucks should have in mind the technologies factor and always build its strategy on it. Starbucks can improve its mobile applications and correlated services as this enables it to gain more returns via purchases made through mobile phones. Also the management should consider enhancing its supply chain competence based on the modern technologies used by the coffee farmers (Smithson, 2017).
Business sustainability trend that Starbucks experiences concentrate on business practices that ensure minimum ecological effect; this, in turn, highlights corporate social responsibility (CSR) in the supply chain (Smithson, 2017). Starbucks has attained CSR milestones such as spending more time in community services and advocating for green building in its stores in various parts of the world. Furthermore, Starbucks has created an international network of farmers whereby it obtains its coffee. The company uses 99% ethically sourced coffee; this has in turn, enabled the company to outshine its competitors. As part of the CSR, Starbucks intends to hire 10,000 refugees in 75 nations. The management should consider only reliable sourcing guidelines; besides, the company can offer more of its products in eco-friendly packaging, hence conserving the environment. Starbucks uses disposable cups when serving most of its beverages; this has, in turn, attracted criticism from environmental activist groups in Europe. The waste produced by the corporation is huge, and this has a negative impact on the environment; the company needs to use environmental-friendly cups when serving their products. Most beverage customers are youths; this is a generation more concerned about the environment when the company fails to use environmentally friendly products, it is likely to suffer losses attributed to a reduction in customer base (Smithson, 2017). The coffee used in Starbucks is acquired from different nations when the countries experience environmental calamities, the quality, and production of coffee decreases, hence affecting Starbucks. Global warming has brought about negative impacts on the environment; as a result, coffee production is likely to reduce, thus affecting Starbucks (Smithson, 2017). Due to global warming, the quality of coffee is decreasing; this, in turn, forces Starbucks to reduce the quantity of beverages due to short in supply and reduced quality of the coffee. Environmental rules and regulations are likely to affect Starbucks since the laws vary from one nation to the other. Harsh laws imply that the company needs to spend more on using environmental-friendly cups when serving coffee and other beverages.
Starbucks can improve its performance by fulfilling product safety rules on constituents from genetically modified organisms (Smithson, 2017). The rise in employment regulation in developing nations threatens the Starbucks’ right of entry to the labour market; this, in turn, affects the management decisions through increased expenditure for human resources.
Starbucks is a popular and largest coffeehouse globally. However, the company has to manage and deal with various internal and external issues to uphold its position of being the leading coffee chain in the world. Starbucks’ position will be intact if the employees are motivated, and they accept change as it is inevitable. Effective communication is vital in an organisation as it plays a role in the coordination of activities and various operations undertaken in the company. Leaders also have a role to play in ensuring that the various operations are undertaken and it aligns with the organisational goals. Leaders in Starbucks ought to have situational dealings, strong positions, and competency. Starbucks should also implement leadership and management training, as this enables it to retain its status.
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