Case Study: Starbucks’ Structure
MGT330: Management for Organizations
Instructor: James Worsley
October 13, 2014
Case Study: Starbucks’ Structure Starbucks Coffee, we all know the name and most love the coffee and atmosphere it brings to our daily lives. Starbucks started out like most organizations a small coffee shop in 1971 in Seattle’s historic Pike Place Market and grew. This small shop started out as a single owner who the employees answered to which is known as departmentalization by function and has now grown to be divided by territories known as geographic regions. This fortune 500 company is not a stranger to economic hard times, in 2008 and 2009 Starbucks closed over 600 stores. The organization went thru…show more content… What they serve in the United States may not always be what they sell in other countries, or California may not have the same menu items as Maine. The concept is the same and the base of the organization is the same, coffee, however the pastries or type of specialty coffee may vary upon location. The form may be changed in stores offering food products and lunch due to the region-specific menu items that are served. By being flexible and accommodating to the region-specific demands keeps the organization marketable and the desired sought out location.
Starbucks began to experience financial problems in 2008 and 2009; this was mainly due to the recession and rumored of poor business strategy (LaMonica, 2008). When a company goes thru a hard financial time the organization pauses and looks at organizational structure to see where the breakdown occurred or change could be implemented. ” Centralization and decentralization refer to the degree of delegation of decision making, authority, and power within an organization” (Reilly, Minnick, Baack, 2011). The leadership should centralize power and decision-making for the operations as a whole. With Starbucks a large fortune 500 company with locations all over the world, this will be difficult. By standardizing a plan for all franchise and locations to follow and maintain would help the business be uniformed however allow the flexibility for region-specific demands. Structure configurations constitute the