Brewing Success: Analyzing Starbucks' Organizational Dynamics, SWOT, and Ethical Practices - Free Essay

Introduction

The first store of Starbucks was opened in 1971 by three people in Seattle (Starbucks Corporation, n.d.). The founders Jerry Baldwin, Zev Siegl, and Gordon Bowker came up with the coffee store based on their love for coffee. Not only did their love for coffee link them together, but coming from academia was also another aspect. The name Starbucks is from the novel Moby Dick whereby it was based on the first mate of Herman Melville. This company forms the most extensive chain that deals with coffee all around the world, establishing its headquarters where the first store was opened. Their inspiration to provide outstanding quality and quantity coffee came from an entrepreneur who roasted coffee. This company purchases coffee beans and after that roasts them accordingly. It is after roasting them that the organization sells them either as a liquid or as beans. The company sells fresh beans or brewed coffee, whereby its quality is undeniably the best in the world. The organization also sells Italian espresso beverages to ones that have been coldly blended. Food items are sold as complimentary as well as accessories or equipment that are related to coffee. The organization does not limit the services to coffee only but to tea as well as compact disks. The organization setting, culture, as well as ethics, explain the success of Starbucks. This paper conducts an in-depth analysis of Starbucks Company; thus giving a clear understanding of the Corporation's functions. The report assesses the organizational setting, ethics, and culture, as well as its strengths, weaknesses, opportunities, and threats to explain the business flow at Starbucks clearly.

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SWOT analysis

Strength

Starbucks has a lot to offer to the people though they also have their struggles as well. Based on the SWOT analysis, the strengths of the company include its supply chain being global in an extensive manner, its brand image is strong, and its diversification being moderate through the use of its subsidiaries. Its brand image is what keeps the organization going as the people are attracted to it, and it attracts people all over the world as a result of their supply chain being extensive. The diversification enables Starbucks to minimize any effects that may arise as a result of the market risks or risks concerning the industry.

Weaknesses

Despite having significant strengths, Starbucks contains several weaknesses such as the points on the price being high, products imitation as well as most products being standardized (Lombardo, 2019). The high cost of the products makes the organization make significant profits, but the people find it hard to afford it, and this makes the people shy away from buying the products. The products present in this company can be copied and created by another company, and as a result, it makes the competition with other organizations to be empowered. The standardization of products makes it even harder for the company to be less flexible when it comes to the chain business of coffee and its beverages.

Opportunities

There are several opportunities present in this company, such as the business diversifying, the developing markets expanding as well as the Corporation partnering with other companies. For the organization to increase revenue, then they can grow to markets that are developing based on the brand that they didn't have. As they expand to other markets, it is best for the organization to diversify its products and not focus on the current industries. Alliances also assist organizations in a significant way as it means that distribution will improve substantially, and the share of the market will increase considerably.

Threats

As the organizations have opportunities, there are also threats present in the organization such as imitation, the movements of the coffeehouse being independent, and competition that involves coffee sellers of low cost (Lombardo, 2019). Several organizations sell coffee and what is a threat to Starbucks is the fact that there are companies that provide coffee products at a lower cost than Starbucks. There is a threat for other companies to imitate what Starbucks provides as the company offers generalized products. The environment of the industry is based on how independent the coffeehouse movement is, which is based on the effort of the socio-cultural. The effects of the sociocultural determine whether the expansion will take place on multinationals or will be opposed.

Ethics approach

Ethics is an integral part of the organization, whereby it determines its success. The reason for this is that ethics determine whether the goals of the organization will be achieved. Ethics in Starbucks start from the leadership whereby the leaders have to be integral and focused on fulfilling the purposes of the organization. With such a kind of leadership, then the rest of the people will also be ethically based on the leadership present. Other than just the administration, resources are also provided so that the staff can be ethical and not blame on lack of resources. Decisions based on ethics are made by the people in leadership positions based on the business conduct standards.

The business conduct standards ensure that everyone does their daily work in the organization without fail. There are reports utilized by the organization for the sole purpose of making sure that everyone is compliant with the legal and ethical aspects of Starbucks. In the case the leaders find out the people are not respectful based on the reports, then they are forced to speak so that the unethical behavior may be fixed accordingly, and this is not limited to leaders but the partners as well.

Corporate Social Responsibility

Corporate social responsibility focuses on the well-being of the people interacting with the business either directly or indirectly. This responsibility is for the organization to make sure that the environment where the company is being conducted is being taken care of in the right manner. Following the regulations put in place by society, and the government is a form of social responsibility as the organization is acting ethically. Starbucks has incorporated corporate social responsibility in a significant way which explains why the organization is thriving.

The purpose of CSR is to ensure that there is development when it comes to the economic aspect of the people (Mohn, 2017). Growth can be attained by hiring people so that they can make their livelihood to be better. The quality of life of the people living within reach of the organization should be improved as it's a way of giving back to society and appreciating their presence. Their families should not be left out either as they are also important, and this is not limited to the people in the external environment but those in the internal ones such as the employees, supplies, shareholders, and customers.

A dedicated group can be utilized to ensure that CSR in Starbucks has been applied accordingly (Ostrow, 2015). The executives are the ones who are in charge of ensuring that CSR is managed accordingly and in case any issues arise, then they report them. There are different levels in CSR, which are division, department, and business. The CSR focus in Starbucks is on taking care of the environment, community, and ethical sourcing (Ostrow, 2015). The development of society is the main focus.

Four critical elements of a plan

Every organization requires planning so that it can fulfill its strategic aspect. There are four elements of planning which include objectives, implementation, resources as well as actions (2018). Objectives refer to the statements that the manager wants to do for the organization shortly. These statements determine how the organization should be run for them to be achieved accordingly. For planning to be effective, then it means that the objectives should be measured accordingly. Goals can be quantified through social responsibility, innovations, profitability, performance as well as the responsibility of the manager, productivity, market standing, attitude as well as the performance of the workers, and physical as well as financial resources.

Upon creation of the plan, there should be a clear direction of how to go about it and assigned to the people accordingly, which refers to implementation. There are several ways that performance can occur such as policy, authority, as well as persuasion (2018). Resources refer to constraints that are present in the process of action, which includes budgeting. As for activities, it is the means that are to be utilized for objectives to be achieved. As for Starbucks, they have the goals laid out clearly and most of the areas used to measure responsibility it is in order. The organization is making huge profits, and its corporate social responsibility is in order.

One of the objectives of Starbucks is to provide the finest coffee and become the leading brand as well as the leading retailer. The action that the organization should take is to venture into markets that are developing for the sole purpose of ensuring that the objective is met. Starbucks has the resources to ensure that the action can be done and the organization should come up with a way of implementing the act. They can use the authority to do so as they have a strong leadership team to implement strategic plans, and they can persuade the employees to execute the action accordingly. Policies can be created for the successful implementation of the action and ensure that the program succeeds accordingly.

The culture of the organization is to deal with customers warmly as a way of creating a friendly ambiance to make sure that the customers don't shy off from asking for what they need. The organizational culture of Starbucks is one that creates a sense of belonging and inclusion as well as generating diversity. The main features of the culture include openness, a relationship-driven approach, collaboration, inclusion, as well as servant leadership (Ferguson, 2019). This gives Starbucks a competitive advantage over other organizations.

Organizational structure, organizational culture, Unity of command, centralization vs decentralization, a span of control and formalization.

The organizational structure of Starbucks is a matrix one whereby several different features are utilized differently from the necessary kind of system. The main features in this structure include teams, functional hierarchy, and divisions that are product-based as well as geographic ones (Meyer, 2019). Teams are mostly present in the lowest part of the organizational level, whereas functional hierarchy focuses on the business function, which is organized in groups. As a result of utilizing a matrix structure, the Unity of command becomes obsolete as employees need to report to more than two executives. The organizational structure is decentralized based on the various stores present globally. The span of control is a manager managing about eight to ten stores. Formalization in Starbucks takes place by training employees.

Traditional or contemporary leadership theory and one motivation theory for the chosen organization

Based on the culture of the organization, servant leadership is applied at its best in this organization whereby the needs of the customers as well as employees are put before the needs of the leaders and the organization (Johnson, 2019). If the customers are not happy, then the organization has to realign and come up with a way of making sure they are content as, without the customers, the organization is null and void.