Last Updated 06 Jul 2020

Case Study: Starbucks’ Structure

Category Case Study, Starbucks
Essay type Case Study
Words 711 (2 pages)
Views 355

Barista: This job contributes to Starbucks success by ensuring our service and store standards are met. We do this by providing customers with prompt service, quality beverages and products. Starbucks and partners will experience a friendly, upbeat and clean atmosphere. Key Responsibilities: Develops enthusiastically satisfied customers all of the time. Welcomes and connects with every customer. Discover customer needs and appropriately suggests product with every customer to enhance service and meet sales goals. Offers customers demonstrations, and samples using brewing equipment.

Howard Schultz became convinced that he could turn coffee drinking into a cultural experience. He had traveled to Italy and watched with interest as city dwellers would stop to begin the day at a coffee bar. Using the same type of model, Schultz purchased and opened his first location as Il Giornale. The company evolved into Starbucks, where multitudes of consumers began purchasing designer coffees, such as espresso, cappuccino, and coffee mocha. Store interiors encourage lounging and relaxing with a newspaper, magazine, laptop, or friends.

Each cafe featured enticements such as jazz music in the background, additional merchandise to examine, and comfortable seating. (Reilly, Minnick, & Baack, 2011). Until the 2008 recession, Starbucks had continued to grow. Some of the units in larger cities experimented with selling additional products, including lunch service. Then a quickly collapsing economy, possibly coupled with other problems, including over expansion, sent the corporation on a downhill slide. Founder Howard Schultz worried that the addition of so many locations had watered down the Starbucks experience. Reilly, Minnick, & Baack, 2011).. Starbucks should be using is departmentalization by geographic region. Starbucks locations are all over the United States. According to our text, “Geographical departmentalization makes it possible to tailor managerial efforts that address territorial differences. ”(Reilly, M. , Minnick, C. , & Baack, D. , 2011). Departmentalization can be defined as an effective organizational tool in that it involves dividing people up into different departments or divisions in which collections of tasks are placed together, such as accounting, marketing, and production.

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Going through Starbucks case study, the best suited departmentalization for Starbucks would be by Geographic Region. Starbucks has its financial affairs, legal affairs separated from stores. It has also added talent management, human resources and training and development as part of being specialized departments. This structure works, because it is separated from day to day business and does not interfere with store operations. This will help in the different locations to adapt the menu to accommodate. For example the Starbucks in Florida may sale more ice coffees than in Washington State where it is not as hot.

When the increase of competition began the decline of sales for Starbucks, the leadership shouldn’t try to centralize power. With the leadership being centralized the organization may start making bad decisions because it only allows for two or three leaders to be overwhelmed and start making wrong decisions, where as if they were to have more ideas from their employees they may be able to come up with a structure that can help them through the decline of sales The configuration that best fits Starbucks would have to be the divisional organization.

This is because Starbucks has different products and many business units all around the world. According to an article, Mintzberg’s Organizational Configurations, “The benefit of the divisional organization is that it allows the line managers to maintain more control and accountability. ”(Mindtools, 2012). In conclusion, Starbucks organizations have been a great place for people to work, customers to hang out at, and overall a great place to have coffee.

From what I see, the structure that Starbucks has been using, so far has been doing a good job. According to Howard Schultz, Starbucks chairman, “Starbucks continues to expand our global Starbucks footprint and accelerate the innovation and momentum in our CPG business” (Financial Release, 2011) ? References: CNN Money, (Feb. 7, 2011). CNN Money, 100 Best Companies to work for. Retrieved on September 10, 2012 fromhttp://money. cnn. com/magazines/fortune/bestcompanies/2011/snapshots/98. tml MindTools, (2012). Mintzberg’s Organizational Configurations, Understandingthe structure of your organization, retrieved on September 10, 2012 fromhttp://www. mindtools. com/pages/article/newSTR_54. htm Reilly, M. , Minnick, C. , & Baack, D. (2011). The five functions of effective management. San Diego, CA: Bridgepoint Education. Starbucks Coffee Company, (2012). Starbucks Investor Relations, 2011 Financial Release, retrieved on September 10, 2012

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