Quality Management
Quality management is the core of Starbuck’s business strategy. The company has a premium brand selling premium quality products only, which is also the primary differentiation point adopted by the brand. While the brads business model is mostly differentiated along other different lines, whenever clients think of Starbucks, they think of great quality products and varieties. The brand has made use of this formula since its establishment and it has never compromised on taste and quality. In lieu of the brands products quality, the brand charges premium prices on the produced products. Its stores visitor is mostly characterized by high end customers and the quality and taste of Starbuckss products is practically irreplaceable and that’s why the brand customers are always willing to pay extra costs for better quality. For instance, the Arabica coffee sourced by the company is totally different from normal Arabica as the company is very selective on the beans used in its production. Millions of coffee cups are tasted daily by experts to ensure that the best flavours are achieved as well as having satisfaction from the coffee. The company has also set standards which are typically above the normal thus achieving the best results. Whether a one time or regular client, people always appreciate Starbuckss flavours and quality. This business model has significantly helped I increasing the brand profit margins evidenced by Starbuckss rising revenues.
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Starbucks global operations strategy and surrounding macro-environment
The corporation gains above average returns due its established techniques of differentiating and delivering high quality food value to its customers. The brand has gained a competitive advantage in the coffee industry globally through these imitable market strategies. (Aaker, 2012). Among the strategies include high quality and flavorful coffee drinks that help the corporation in standing out among different market competitors involved in the coffee business
By implementing unique differentiation strategies, geared towards offering high quality value and products to customers while still attaining operational excellence, the brand has achieved long term brand customer loyalty. This makes it difficult for other competing brands to to overtake star bucks by replicating the companys’ strategic international market approach (Welsh, Raven & Al-Mutair, 1998).
Certainly, the “Me Too” strategy used by different coffee corporations can rarely provide competitive advantage and stellar performances unless they have the resources and competencies required to offer high quality product to customers.
It is through this unique strategy that Starbuck has managed to offer a wide variety of unique and high value products to its customers. The pace that the corporation fared its ascension in the market has materialized incredibly.
Further, the corporation is well renowned of taking oldest global products and modifying them into differentiated value laden and lasting brands. Beside this, most of the companys’ products are differentiated in order to attract high value standards and clients thus increasing the companys’ market competitive advantage.
. In the international markets, the low cost incurred in producing the imitable differentiated products helps the company in overcoming different external environmental changes.(Biederman, 2005). These differentiated products are hard to replicate since they have an unusual positive brand image which fully integrates technological capabilities, innovative designs, and with an extraordinary high quality. These plainly validate the premium prices charged on different products which surpass the involved differentiation costs.
Starbucks Quality Management Key requirements, capabilities and challenges
The key operations requirements for Starbucks to achieve excellence in the quality management framework includes may be maintaining high levels of product and service quality. The rising levels of competition in the coffee industry has fuelled the level of clients expectations on product fleshiness and quality. From the operations assessment, it is evident that Starbuckss has a robust and highly efficient quality management system which incorporates best management approaches and practices in its operations. Through the logistics and distribution analysis, starbuck has far reaching distribution channels that helps in reducing redundancy as well as maximizing business operations efficiency (Rodrigo,2012). Starbucks has a fine quality control [process which helps in delivering high quality products ad services. The products offered are exclusively customer driven and are normally produced based o the clients tastes and preferences thus attracting customers to purchase the products .In order t0 achieve produce high quality products, Starbuckss incorporates a wide range of initiatives including checking on the quality measures involved the production of coffee beans from the farms.
Despite of the extensive success factors in Starbucks quality management strategies, the company also experience some challenges associated with the quality management processes. Among the presenting challenges include responding to changing customer need. Since its initiation, Starbucks has proven an outstanding ability in recognizing the needs of different customers. The company always seeks to mot only provide the customer with a beverage but and experience in an effort to make starbuck “third place between work and home which have ”
have separated Starbucks from other coffeehouse chains. These experiences are shaped from different tastes, flavors and even packaging designs and in order to sustain the clients, the companies needs to adapt to these customers needs and preferences’ he other challenge facing starbuck is m poor infrastructure which often results in destruction of perishable raw materials such as milk. With the great demand for starbuck products, the company have been forced to outsource its products raw materials especially from developing countries which are characterized by poor infrastructuirall amenities such as roads. During the transportation of these raw materials, most of the materials perish on the way eventually resulting to massive losses on the company. Some of these products have a low shelf life like milk and thus in case their transportation is delayed, massive losses might occur.
Analysis and Evaluation of Chose Operational Area.
The provision of high quality , flavored and tasty coffee has increase the reputation of Starbucks as the leading coffee retailer globally. Due to the companys’ continuous profit growth, competitors have started to merge from their observations on the increased revenues cropping up from the business. Despite of the existing market related threats , the company still have the most effective strategies compared to any other coffee shop company. This can be seen on the corporations earnings which have risen up constantly from its outstanding coffee taste, quality tastes and quality systems that have earned it a wide range of recognition.
The companys’ success in the global market shows how the company have qualitatively developed effective strategies for helping it to grapple with its competitors. One of the strategy used by the company is segmenting the market and focusing continuously on the products bundles. Howard Schultz, Starbucks founder emphasizes on the implementation on new innovative ideas geared towards expanding the products portfolios. Following the implementation of these strategies, the company has shown significant improvements on its profit margins and it is still expected to notch higher on its future sales. For instance, in 2019,the companys’ profits increased by 25% from 2018 earning additional $417 million with each share earnings 55 cents. Its revenue increased by 13% with the operating margin increasing from 14;9% to 16.4%
.Compared to other coffee shops, the company has always maintained a close eye on its quality assurance measures in all its products. One thing that makes the companys’ coffee outstanding compared to other companies is the fact that they use exceptional coffee beans with the believe that flavor, quality and complexity cannot be achieved from simple roasting. Coffee beans are normally placed in high altitudes which increases the bean density and eventually create flavor. However, altitude is the not the key factor that helps in achieving the quality and flavours but the sorting and grating also helps in meeting the outstanding standards.
The company also uses various quality systems in order to provide its customers with high quality services. For instance, random check-ins are used by district managers to check the baristas, seek customers fed back as well as checking whether the drinks meet the quality standards. EcoSure is also used to carry out required specifications checks twice a year in all stores to ensure that all stores comply to the set quality standards. Further, the company empowers its employees on quality management systems by mobilizing and training them as brand ambassadors as well as offering them adequate employees benefits. Though these effective quality systems contributions, starbuck has been awarded several prestigious awards and recognitions including the “No. 1 Best Coffee,” Fast Food and Quick Refreshment categories on Zagat’s Survey of National Chain Restaurants and Best Global Brands by Interbrand. The company was also included in one of the “The 100 Best Companies to Work For” and “Most Admired Companies in America” by Fortune..
Moreover, the company has a cross functional design team from different departments charged with the responsibility of ensuring the quality of the design. The team makes sure that the clients concerns are put into consideration in the product production and packaging to achieve the desired tastes and preferences. Quality of availability and conformance is another area that the company focuses on. In its operations, the company ensures that the products meet all specifications regardless of the quality of the design. For instance, starbuck meets different products specifications by allowing clients to have the coffee made based on their tastes and preferences such as foam, non –fat, a shot of expresso, decaffeinated among other personalized options. Maintainability, reliability and availability also matters in product conformance. For instance, availability come into play when the machines or products for making coffee products and running effectively. The company has several machines in every store with adequate trained employees to ensure that the machines are operating and fix any operational issues thus increasing their reliability. To maintain the machines, the company ensures that the employees are well trained on their maintenance and incase the machines fails beyond immediate fixing, an additional machine is always brought on board. These quality management strategies have greatly contributed to starbuck high profit margins and the outstanding reputation.
