Organizational Culture at Starbucks: A Recipe for Success

Organizational Culture at Starbucks: A Recipe for Success

Introduction

The unpredictability of the business environment is evident in modern society. Most businesses have become uncertain about their future operations due to the political, economic realities that face most countries. Therefore, businesses often strategize on being adaptive in these changing environments. Nevertheless, seldom are large companies concerned about the idea of being adaptive; instead, they focus more on exploring newer ideas that create value. The creation of value, in this case, encompasses raising a prosperous business model through summing a constant environment. Starbucks Company has propelled its organization model to ensure that it is adaptive to uncertain business environments (Pangarkar & Pangarkar, 2011). The organization has adopted the flexing strategy, where the managerial procedures have been involved in boosting the production process. The organization is concerned with empowering its workers with the skills and knowledge of the current work environments following the market trends. The business often performs research on the market trends by reviewing the responses from the customers concerning their new interests and choices on different brands and goodies.

Training employees to compete favorably with other companies has given the organization the advantage of competency and trust in the production process. The possession of the skills and knowledge has promoted a faster decision-making process among the employees. The adoption of the many empowerment programs has made it possible for the workers of the business to be adaptive to the changing business environments (Pangarkar, & Pangarkar, 2011).

Starbucks organization has adopted the Classical Plan and Executes Approach that involves predicting future business environments (Reeves, 2019). The company uses market trends in predicting future prices, demands, and production. This data helps the organization to plan some strategies that consider the GDP of the countries. The approach has enhanced its addictiveness in the changing economies and political environments across the world. Benchmarking has formed a dominant approach that makes the company conversant with the production and management strategies that would promote a competitive advantage. However, the strategic plan considers the conditions of uncertain business trends like employee capacities and culture.

Strategic planning has been based on management alterations that have made it possible for the organization to train the managers who are qualified. Investing in creating managers promoted the adoption of a healthy and reliable culture at the organization. The use of teamwork culture in the workplace environment has improved employee cohesiveness, thus increasing efficiency and commitment. Encouraging the “leader” approach to the management process has enhanced a positive attitude among the workers who are willing to take up responsibilities on the lines of duty. The practice has encouraged creativity and innovation among the workers, thus encouraging a competitive working environment. The company frequently measures the employees’ performance to ensure that each employee maintains an up-work trend in the delivery process (Rossman, 2009). The idea has helped the enterprise to account for all the inputs and entire production processes.

Additionally, the organization’s culture has been shaped by the values and the beliefs that the business holds. The adoption of a world view has shaped the organization’s culture that is expressed through art, brands, and design of products. The organization is based on a loyal and sincere culture in service delivery; the culture is nurtured through constant reviews on customer association who give feedback on how they experience the services.  An instrumental organization structure shapes the organization’s culture of the firm (Bolton, Kim & O’Gorman, 2011). It is managed based on various levels. For instance, the company has a high level of management, which defines the official duties of the workers. The formal feature of performing duties enhances quality delivery and respect within the firm. Loosely defined job descriptions characterize the organization’s culture of Starbucks. As such, it allows the employees, investors, and different stakeholders such as customers to challenge goods and service delivery for the origination. The idea has been instrumental for the development of Starbucks since it has created a framework through which issues concerning the firm can be addressed. This was attributed to an outstanding competitive advantage enjoyed by the industry. Notably, through a loosely defined job description, the firm has been able to improve its service delivery. Giorgia (2014) outlines that creativity and innovative nature cultured by the workers in business through challenging ways of service delivery is crucial since it helps in service delivery. This has enabled Starbucks to increase the number of its clients due to quality service delivery.

Bolton, Kim & O’Gorman (2011) suggest that the people-orientation organization culture helps in propelling business achievement. Therefore, Starbucks ‘ utilization of strong people orientation mechanisms in decision-making is of great advantage to its development. For instance, in the production line, the firm is focused on how they can improve on its products to fit the client’s desires. It is driven by the notion that clients and their employees are an essential part of their success. Therefore, in their decision-making, their productivity and performance are streamlined towards enhancing workers’ job satisfaction and quality service to their clients. The incentives offered by the firm have also shaped its organization culture. The workers are offered both monetary and non-monetary incentives based on their service delivery (Bolton, Kim & O’Gorman, 2011). Workers receive non-monetary services such as promotion, recognition, and sanctions. The firm performs regular incentive program which is intended to enhance the welfare of productive workers. This has enabled Starbucks to breed a workforce that is reliable in the job market. Apart from incentives offered to workers, the firm also rewards the community. For example, they have been sponsoring needy students who have done well academically as well as helping the community in satisfying their needs. The firm, through its CSR programs, has facilitated various community projects.

The aforesaid organization culture has been achieved through the application of Hofstede’s Cultural Dimensions. This has been done through fostering the ‘socio-centric’ ‘egocentric’ culture; including the values and beliefs according to the society, neighbors, and the company stores (Pangarkar, & Pangarkar, 2011). This model of learning has enhanced a positive interaction between the community and the organization. The association of the people’s cultures and identity has ensured that the organization works within the local’s perceptions. The firm ensures the community is protected through proper disposal of refuse. The production process often targets the various age-groups, class, religion, and gender in these societies to improve their preference among the customers. The segmentation ideology in the production process has enabled the organization to satisfy the beverage needs of different customers. Their brands are classified categorically to benefit all classes in society, enabling Starbucks to enjoy thriving businesses as compared to their competitors. The social policies at the organization are based on the cultures of the people in the organization and customers. However, the multicultural approach in pluralized countries, such as the USA, is the best approach that the organization seeks to implement.

The operations of Starbucks are outlined by the idea that “organizational culture is shaped by the main culture of the society we live in, albeit with greater emphasis on particular parts of it” (Pangarkar & Pangarkar, 2011). The firm is located in a diversified society, and due to global issues, it works towards the development and maintaining of integrated culture. The firm works towards ensuring global satisfaction is achieved through the introduction of a palettes strategy. It is an aesthetic way of selling their coffee in specific locales and communities located in their stores. It provides a consistent global balance of the coffee provided.  As outlined by (Starbucks, 2018), a unified culture will enable its operations to be more efficient in the context of different nationals, local, and regional cultures. The organization’s culture of Starbucks is thus dynamic. The external and internal changes affecting the firm have led to incremental and constant shifts in the way things are done. The innovations, community needs, and the customers’ desires have shaped the consistency in changes in organizational culture.

Brief Overview of Starbucks Corporation

Starbucks Company has revolutionized American coffee over decades of production. The organization has more than 87000 customers with over 30 blends. The business was begun by three allies, Gordon Bowker, Zev Siegl, and Jerry Baldwin. Both Siegl and Baldwin were teachers, while Bowker was a writer. The name of the organization gradually changed until the latest one from the earlier one Starbucks Coffee, Tea, and Spices (Bussing-Burks, 2009. The skills of running the business originated from their curiosity and benchmarking from a Dutchman Peet Alfred, who was running the Peet’s Coffee and Tea (Bussing-Burks, 2009). The three friends worked at the company to get the skills in preparing coffee. Taylor Clark identified that each of the friends invested about $1,350 and got a loan of $5,000 and paid a rent of $137 (Bussing-Burks, 2009). Initially, the organization did not make any profit from its sales and had the idea of selling gourmet coffee beans and other coffee-related equipment.

The business picked and survived in the early 1970s making its managers move its headquarters to Chicago from Seattle but retained its store at the initial location. The business’s site near some major organizations has promoted its growth over the years. Starbucks Company has grown tremendously and even introduced newer commodities per the customer’s needs and preferences like the Hammarplast, a Swedish thermos type-drip coffee maker (Bussing-Burks, 2009). The privatization of enterprise was from 1987 to 1992 after the company had opened more than 17 stores in Chicago. It became public in June 1992 at a share of $17 per share and had more than 125 stores. Since then, the company has grown into an international agency selling its products in oversees counties contributing its revenue of over $10 billion (Bussing-Burks, 2009).

The management of the organization is at the heart of its success. The possession of the entrepreneurial skills and talents has scaled the organization to the peak of the production advantage. With the growing competition in the global market, the organization has adopted the strategy of diversification and maintaining a healthy culture in the workplace.

Corporate Social Responsibility

Company orientation towards Corporate Social Responsibility (CSR) is based on a business model that takes into account the regulations of CSR. The basis of corporate social responsibility is the achievement of a balance between profits, citizenship, and environmental conservation (Bolton, Kim & O’Gorman, 2011). This responsibility aims to ensure the societal benefits and growth alongside the profit generated by the enterprise. Starbucks Company has laws that guide the implementation of its corporate social responsibility that begins from the production process to the profit collection. Firstly, the enterprise is anchored on the principle of “wheel of change,” implying its commitment to ensuring a leading position in environmental conservation (Bolton, Kim & O’Gorman, 2011). The company, for example, sources its raw materials from the neighborhood to promote the economy of the area. The goods produced by the organization are often organic; the packaging materials are environmentally friendly. The substance contents used on the beverage are healthy following the medical analysis.

Besides, the organization values and promotes a green environment agenda; this is realized via the planting of trees with the help of society. There is a sewage plant that is treated effectively before release. This is to ensure the safety of society’s health. The locals enjoy the low prices of the service and goods than other customers away from the main store. This practice aims at promoting health. Giving back to the society has been part of the organization, the support of the local football teams and other spots have formed the broader role of the corporate social responsibility.

The role of the CEO in directing the vision and mission of the organization can be measured on the scale of corporate social responsibility adherence. At Starbucks, the CEO has been at the forefront in directing the enterprise’s funding of the non-profit making organizations that are based in the society (Yuan, Tian Lu & Yu, 2019). He often encourages the training of the employees to equip them with the necessary skills and attitudes towards corporate social responsibility. Funding of these projects is done on the scale of percentage allocation to the different programs under the legal framework of the organization, for example, fighting AIDS around the world.

Corporate social responsibility within the business is based on the role played by the management through employees. In Starbucks, the management relies on the interaction of their workers with CSR. This helps in facilitating the CSR initiation, implementation, and maturation. The maturation of CSR is based on the minor contributions made by the staff at the initiation stage. The involvement of workers with CSR has been viewed as a basic cultural trait of an organization. Joseph, Mitchelli & McGraw (2014) view that staff engagement with CSR helps in the development of a sense of responsibility and ownership. This fosters the effectiveness of an industry, a key to achieving the desired CSR. On the scale of the competing values framework (CVF), the Involvement of workers in CSR through practices such as treating waste helps in the development of valuable traits in business. It creates the clan nature of culture, which is a backbone in fostering for both the development and participation towards the realization of CSR. The clan culture created by the workers facilitates the creation of a full dimension through which participation can be increased, thus initiating the process. CSR development is based on stages. Pomper & Blessinger (2014) outline that the initiation stage is the first process involved the first stage in CSR development.  At this stage, the firm’s workers engage in helping the community through reactions from the society as requested by the management. However, the external pressure does not give room for their human rights to be observed. As such, it brings forth to unbalanced priority issues affecting the workforce. The bigger picture cultivated by the firm is the external issues from stakeholders. Rossman & Beebe (2009) highlight that the common values facilitate the concern desired to be accomplished by the firm as requested by the community. The engagement facilitates the realization of a culture of responsibility characterized by socially responsible culture.

The firm also engages in the CSR through justification using appropriate claims concerning CSR to the various stakeholders. This takes place at the implementation stage. The management, through its staff, builds a worth relationship with the community. Starbuck CSR should be outlined as investments to enable the community to develop. As outlined by Reeves, Levin & Ueda (2016), the engagement of employees in the implementation of CSR is essential. The authors view staff as a vital link between the community and the company. This results in their visibility in the community. Most of them reside in the locality, and thus, their role is seen as a mutually reinforcing acct between the external and internal stakeholders. Therefore, the engagement employees with CSR will lead to a structured and more meaningful way of engagement between Starbucks and the community. However, the implementation of CSR cannot be achieved if the staff cannot nurture its vision and mission. After justification for issues from the community, the corporation executes the maturation of the CSR. The employers realize the great contribution made by the workers towards the creation of a socially responsible industry helping in the development of a “moral community.” The achievement of the goal helps in the mediation of inevitable conflicts experienced by various stakeholders.  The growth of a moral community by the firm is attributed to the motivation of employees.  Lindgreen et al. (2011) view this as a “bottom-up” mechanism. The shared values developed strengths the relationship between the various stakeholders involved. For example, a good relationship can be harnessed between the employer and employees and also between the company and community. Such helps in the achievement of an integrated relationship between CSR, strategy, and workers. CSR is a necessary impetus towards the accomplishment of external demands such as addressing issues affective the environment.

Starbucks Corporate Social Responsibility Initiatives

Starbucks is among the leading enterprises that promote sustainability in America. The enterprise’s vision is to ‘serve sustainable coffee in sustainable ways.’ Partnering with Conservation International about C.A.F.E practices has supported the ethical sourcing of coffee (Starbucks, 2018). The company has developed the economic sustainability of the farmers by granting long-term profitability. This is evident in the provision of coffee trees that are climate-resilient (Starbucks, 2018). The organization has programs such as ‘Starbucks Foundation Origin Grants’ that empower the women and families in planting coffee, strengthening leadership capabilities, diversify their economic activities (Bolton, Kim & O’Gorman, 2011). Such programs have enhanced economic advancement among the community members not only locally but internationally.

The organization is working on implementing “green cups and packaging” that would promote its agenda of environmental conservation (Starbucks, 2018). The use of new technologies in the production process at the institution has assured the customers of healthy products. Starbucks operates 1,600 Leed proficient stores that are environmentally friendly, making it be the world greener enterprise (Starbucks, 2018).

Access to greener power by investing more than $140 million has promoted the company’s use of renewable energy; the energy is used in over 9.000 stores in the USA (Starbucks, 2018). The provisions of loan services to the customers and farmers have sponsored many individuals economically and boosted their investments in the business. Such empowerments are given alongside other training sessions to the farmers and planting trees in the environment.

Venturing in most programs and the provision of connections has proved the company to be the hub for opportunities. There exist many employment opportunities for many professions, and the youth generally (Bolton, Kim & O’Gorman, 2011).  Additionally, the organization offers some opportunities for partnerships for both local and international agencies.

Conclusion

Organization culture is essential in enhancing the development of a firm. How a firm operates reflects on their success. The revolution of coffee production by Starbucks in America was as a result of the utilization of the most effective organizational culture. America is a multi-cultural state, and thus, the tastes and preferences of people differ based on national, region, and locality. As such, the application of dynamic culture according to age, gender, religion, and the class was important. The industry coffee is based on a global cultural perspective. The firm uses a palettes strategy, which has been an effective way of balancing global needs in coffee desires. The organization’s culture of Starbucks has been shaped by the customer’s desires, innovation, and community needs. Primarily, the needs of the community have been enhanced through corporate social responsibility. Starbucks operates with an ideology that investing in the community is vital towards its achievement in business. For instance, through their “wheel of change” initiative, the firm has been able to address the issues affecting the environment. They use organic material in their coffee production from the community. The ideology is geared towards enhancing the development of the locality community. Nonetheless, treating refuse before disposal and using environmentally friendly materials has also initiated the preservation of the environment. Various CSR initiatives have shaped the values of the firm. Starbucks engages in empowering women, communities, provision of job opportunities, and environmental sustainability practices.

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