Case Summary Starbucks ( Based on the case reading to answer the five questions) – Case Study Example
Starbucks Case Summary Since its adoption of a transitional change that was mean to revolutionize the industry, Starbucks has tremendous development from an ordinary roasting and supply of coffee beans to a perfect blender in business. From the initial sale of beans, Starbucks embraced a unique branding strategy in all its outlets and developed a new taste, unlike ordinary American coffee. The company roasted its beans adding up to a new flavor of freshness through steamed milk under right temperature. Besides, Starbucks invented new brands such as quasi Italian lingo giving customer’s inspiration of a living taste.
With drastic expansion of its outlets between 2006 and 2009, Starbucks formed joint venture with popular companies such as Pepsi cola of North America where it succeeded in launching a new drink Frappucino. Besides, the company also entered into an agreement with Dreyer to produce flavored Ice creams that were later made available among the local outlets. Ultimately, Starbucks had a licensing agreement with Kraft foods to facilitate distribution and marketing of its products. However, the company had to forego some of its initial machines that could not meet modern market production demand. Moreover, it adopted grounding of beans before brewing, a new strategy that consumed a lot of time thus exposing some of the weaknesses within the supply chain management.
With Schultz joining Starbucks as the CEO in 2008, he adopted a rapid transformation in the context of competitiveness such as closing all non-performing outlets with the aim of reducing the operation costs to the company. In addition, it was facilitated by the fact that such outlets had not made any recommendable returns to the organization since they had been set up. Moreover, it was part of a recommendable strategy to introduce cost effective high performing machines that were aimed at improving the production. Moreover, Starbucks adopted a a mew lost profile by replacing the previous taste of roasts coffee pike place roast. Schultz further developed a new strategy against the competitors by a rotating selection of coffee combinations like Sumatra, Kenyan blend and French roast that acted as a competitive block against the rivals.
Internal wrangles that affected Starbucks from attaining its competitive edge included Kraft, one of its joint ventures that were viewed as a stumbling block deterring the organization from achieving its objectives. Kraft was perceived to cause a lot of downfalls to the organizational progress on the part of cereals. Besides, the organization experienced financial crisis associated with limited returns that caused some of its outlets to be terminated so as to improve production returns of the entire organization. However, some of the above internal wrangles could trace back to the point when the company was set up.
Starbucks Company also experiences external issues affecting it from achieving its competitive strategy. For instance, Starbucks coffee was perceived very expensive as compared to competitors who were also dealing in a similar product. More to the point, the organization experienced an uphill task while introducing its brands into the market. Especially, in areas such as movie theatres where some customers still believed that such environments were non-compatible for coffee vending machines. However, much improvement was made when the organization assigned agreement to offer hot and iced coffee at Burger king locations. Faced with different challenges, the organization was meant to improve on its strategic plan and ensure it gets the best out of the business.