Strategic Management Starbucks

Starbucks Coffee originated in 1971 as a coffee and tea café opening in a small neighborhood of Seattle, Washington (Starbucks Corporation, 2010). Starbucks continued its service for Seattle residents for a decade when the new director of retail operations and marketing, Howard Shultz, decided to make some beneficial changes to the company. After two years of employment Howard Shultz decided to expand Starbucks outside of the Seattle area. In 1987 Starbucks was entering in the coffee market and the few numbers of Starbucks were now becoming a corporation (Starbucks Corporation, 2010). Fast forwarding to current times, Starbucks is

Starbucks Corporation is a coffeehouse chain that began in Seattle in 1971. Since that time, Starbucks operations have grown; there are now over 22,000 retail stores throughout 67 countries. Starbucks strives to offer customers a comfortable, “home-like” environment while remaining conscious of ethical behaviors and social responsibility. It can be argued that Starbucks dominates the coffeehouse market, and much of this may be due to a grand strategy with a focus on growth. Using a growth strategy, Starbucks attempts to increase its market share and revenues by increasing the number of its stores and the number of locations it serves. So far, Starbucks has enjoyed much success with this strategy.

The extraordinary success Starbucks experienced during the early 1990s resulted from Howard Schultz’s passion and vision to create a coffee culture in the United States similar to the coffee culture he experienced while traveling to Italy. Schultz’s vision of the Starbucks brand evolved around providing a quality product while delivering exceptional customer service in an inviting atmosphere. Starbucks’ success can be attributable to the following factors:

Starbucks initially was a small structure, run by three partners in a small shop in Seattle. The company then was restricted to selling only whole bean and ground coffee. It was typically a top down structure were the three people in the top management were the decision makers. In 1984, when Schultz suggested the idea of selling coffee and expresso drinks, the directors of Starbucks rejected the idea, in spite of the fact that the move would have made more profit for the company. This displayed the rigidity of the management towards any changes in the business.

An international coffeehouse franchise named Starbucks was founded in Seattle in 1971. It is the world’s largest coffeehouse and coffee retail chain, with approximately eleven thousand stores in the United States and more than twenty thousand stores worldwide in sixty-five countries ("Annual Reports). In 1981, Howard Schultz was introduced to Starbucks and had an immediate attraction to the company that drew him in for years to come. Schultz traveled to Italy in 1983, and the Italian coffee bars he frequented inspired him to develop a vision that would bring the Italian coffeehouse tradition to the United States. With the aid of local investors, Schultz purchased Starbucks in 1987. After the purchase, Starbucks opened its first location outside of Seattle.1 When Starbucks went public in 1992, the chain had grown to 165 stores across the country. Starbucks grew into 17,000 stores in 55 countries in 20 years ("Annual Reports"). The company has publicly stated that it intends to expand its brand and social influence into the realm of pop culture and to rival McDonald’s in level of global reach and economic power (Garcia, "Starbucks"). Starbucks expanded by entering into a business deal with Barnes and Noble. The goal was to sell Starbucks coffee in bookstores where people came to spend quality time reading books. Furthermore, they decided to expand the business concept out of the United States by launching over 200 new store locations. As soon as the concept was introduced

Starbucks is known as the dominant specialty-coffee brand in North America. Beginning in 1987 when Howard Schultz, Starbucks chairman, president and chief executive officer, purchased the single-location coffee-house from the original founders, Gerald Baldwin, Gordon Bowker, and Ziev Siegl, he had a vision to create “a place for conversation and a sense of community. A third place between work and home” (Starbucks, 2015). Starbucks created and continues to offer this “third place” through exceptional customer service and inviting environments that provide an experience that becomes part of the customer’s daily life. In 1992 the company completed its initial public offering and by 2002 Starbucks had rapidly expanded from a local Seattle company to an international corporation with 5,886 retail stores on four continents posting its highest net earnings in its history despite the economic downturn during the 1990s.

In 1987, with the help of a few investors, Howard Schultz bought Starbucks and combined it with Giornale, the rest is history (The leadership summit). Mr. Schultz had a vision for Starbucks saying; "I saw something. Not only the romance of coffee, but ... a sense of community. And the connection that people had to coffee—the place and one another"(Howard D. Schultz, 2014).

1.Analyze the business-level strategies for the corporation you chose to determine the business-level strategy you think is most important to the long-term success of the firm and whether or not you judge this to be a good choice. Justify your opinion.

One company that has been particularly successful in creating an overall company image in my option has been Starbucks. They have been able to maintain a dominant position in today’s market. Where in the morning most of our society needs a good cup of coffee in order to start their day. At one point, we looked at Starbucks as a high-end marketer. A sort of club to belong to. However, things managed to change in the recent years where a 4.00 cup of coffee was becoming a luxury items. This became known as the Coffee Wars. Starbuck had to now face competition from the fast food world. Which was McDonald’s and Dunkin’ Donuts. They started to look at this market as an opening to gain more customers. They started to offer their

Starbucks was founded in 1971 and opened their first location in Seattle’s Pike Place Market (“Company Information,” 2015). Although the company’s website did not give any information on the founders, further research provided the names of three young businessmen. Jerry Baldwin, Zev Siegl and Gordon Bowker opened the store where they only sold coffee beans and coffee making machines (“History of Starbucks,” 2014). In 1981, Howard Schultz became the director of operations. Howard was fascinated by the coffee industry, and a year later took a trip to Italy to gain further insight on the operations of coffee shops. When Howard returned he had acquired new ideas and wanted to serve drinks, not just make the beans. When he could not convince the owners to agree with his ideas, he set out on his own in 1985 and founded Il Giornale. Just two short years later in 1987, Howard Schultz acquired Starbucks with the help of local investors and took over the business (“Starbucks Company Timeline,” 2014). From there, Howard expanded the company and made it into what it is today. The biggest factor overall that has contributed to the company’s growth was when Howard Schultz first started working for the company. From the beginning, he wanted to make the company into so much more than what it was. A specific way that Howard contributed to the growth was when he traveled to Italy. This experience gave him insight on the operations of coffee

In 1981 the director of marketing of Starbucks Howard Schultz traveled to Milan Italy, there he was amazed by the café that existed on every street corner of the city. When Schultz came back to the United States he was determine to turn Starbucks, which was just a coffee bean retailer at the time, into a café. The owners of Starbucks at the time didn’t buy into the idea so Schultz branched out, and would later make enough money from his idea to buy Starbucks from is former boss and turn Starbucks into what it is today. Today Starbucks is one of the most successful companies in the world, with over 21,366 stores worldwide. They buy coffee beans from all over the world, transport them, process them and get them to their store by some of the most sophisticated, and efficient logistics procedures.

Starbucks is and will continue to be one of the largest distributers of a cup of coffee today and into the future.  The Starbucks mission to “inspire and nurture the human spirit – one person, one cup and one neighborhood at a time” directly correlates with the experience a customer has in each store. They have many ways to differentiate in comparison to competitors because they provide an experience while shopping for a coffee allowing them to charge a premium price.

This paper examines strategic management, which encompasses business decisions and actions that: define the organization 's mission and objectives, determine the most effective utilization of organizational resources, select best courses of action to meet its mission, and seek to assure the effectiveness of the organization within the environment. This case study evaluates the strategic management process, and applies those concepts to a practical case study of Starbuck’s mission statement.

Starbucks was originally created to be a retail coffee store and roasting factory. Howard Schultz purchased Starbucks where he changed it into a coffee bar where people could purchase cups of espresso and lattes. He expanded the business into the Chicago area and soon began to open other locations. In 1991, Starbucks created its own in-house team to create and design store layouts and features (Gamble, Thompson, & Peteraf, 2013). He has continued to change the design to meet the needs of the communities he sells his product in. They have moved to a new green building code and structure. They have introduced Starbucks CDs, take away cards for music clientele can down load. They now have a Starbucks app where people can order their coffee and it will be ready at the

The store was a success with excellent sales records and thus several Starbucks stores mushroomed in several parts of the US. Howard Schultz later joined the company as a marketing executive and then