Modern Management Essay: Starbuck's Strategy

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Vanderbilt University
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Organizational culture is critical for competitive performance of employees and the business. For Starbucks, their organizational culture is the most distinct characteristic of the organization. The company has invested heavily in corporate culture to distinguish itself from competitors in the beverages market. Particularly, the organizational culture has been crafted in a way that relates to the strategies of the company, which is critical in achieving the successful brand development and expanding the market shares of the firm (Schein, 2010).

The key elements of Starbucks organizational culture include servant leadership approach, relationship-driven approach, collaboration and communication, openness, and inclusion and diversity. Organizational culture at Starbucks has been described as one that emits a sense of belonging, inclusion, and diversity. These features are an integral part of the organization, and both the management and employees have a responsibility of ensuring they are not violated (Koehn, Besharov, & Miller, 2008). According to Koehn, Besharov, and Miller, such elements show that the organization is for all and these elements are visible at the organization to an extent that a customer will be quick to notice the type of relationship employees have with each other and the management.

Servant leadership is another significant characteristic of organizational culture at Starbucks'. The management supports the subordinate with the aim of ensuring that all workers achieve personal growth while meeting the objectives of the firm (Koehn & Grundy, 200). The employees-first approach derived from the idea of servant leadership was first adopted by Howard Behar, the former President of the firm who believed that caring for employees will translate to employees caring for the customers (Koehn & Grundy, 2001). It has since been practiced by the management, making Starbucks one of the best companies in regards to the value its places on workers.

The relationship-driven approach observed at Starbucks is a critical of element of the companys organizational culture. Specifically, the company supports warm and friendly relationships, which is usually seen in Starbucks cafes where the baristas exhibit a friendly relationship with each other. Customers are also treated with warmth and whenever they visit the cafes, they are welcomed warmly with a smile (Koehn, Besharov, & Miller, 2008). As such, customers would always revisit the companys restaurants due to the good treatment they receive. The company also encourages collaborative effort, which is done through effective communication. Employees communicate and work as a team to ensure they fulfill the objectives of the firm. Collaborative efforts through communication are mostly observed in the cafes where baristas take orders and communicate effectively to enhance delivery of service (Koehn, Besharov, & Miller, 2008). Through collaboration and communication, workers realize efficiency in business processes thereby improving the quality of service and customer experience.

At Starbucks, openness is the order of each day. Particularly, the culture of openness is encouraged to ensure employees speak out without fear so that their issues can be addressed. It is also through open forums that the management gets to know of new ideas on how to improve their services. Before Howard Behar introduced open forums where everyone could express his/her views, employees had a culture of fear, especially when speaking to their superiors. Employees started developing the culture of openness, and they would ask questions and communicate freely. It is also through this culture that the company empowers its workers as well as facilitating innovation. The last key element is inclusion and diversity, where the corporation has a policy that prohibits any form of discrimination. At Starbucks, employees are supposed to work together without discriminating others based on ethnicity, race, gender, age, cultural background, thoughts, and ideas (Koehn, Besharov, & Miller, 2008). Specifically, diversity is encouraged for the company to have innovative, diverse ideas. The aspect of inclusion and diversity at Starbucks has also been a key feature that customers consider when visiting the cafes because they feel welcome.

Starbucks management understands the importance of customer satisfaction and other than just providing coffee to them they also have other innovative offerings (Koehn & Grundy, 2001). Starbucks digital network is one of the innovative ideas by the management that has proven effective. According to Miller (2010) the digital network provides free unlimited Wi-Fi to customers who use Starbucks stores and cafes as a makeshift office and at times meeting place. This has added value to its customers, and with such innovations, Starbucks has successfully retained its customers as well as attracting others hence increasing its competitive advantage.

A key management competency that Starbucks managers have is the ability to listen to ideas from other employees. In other words, they do not micromanage workers. Howard Schultz is a perfect example of a manager who is willing to listen. Specifically, Schultz is known to recruit top performers who could oppose his ideas and come up with brilliant ideas (Koehn, Besharov, & Miller, 2008). An instance of when Shultz idea was opposed was in 2008 when he ordered the Cafes to stop selling melted cheese breakfast sandwich. He argued that the aroma of the sandwich was masking that of coffee, which is the company's core product. However, key leaders pushed back the idea and instead suggested that they should continue offering the sandwiches but make them less aromatic. In spite of the clash of ideas, the management reached a compromise because Schultz was willing to listen. The key management competency is a good fit for the organizations culture because it encourages openness and consultation when deliberating on various issues at the company.

Starbucks is one of the companies where micromanaging does not exist, and delegation of duties is the order of the day. The company has the best leaders who are top performers thanks to Schultz who recruits the best in the market. These leaders can run the company even in the absence of Howard Schultz because they know what is required of them. Also, Schultz's openness to new ideas and ability to delegate leadership duties has enabled him to craft the best leaders in the management team (Koehn, Besharov, & Miller, 2008). Therefore, the company can achieve long-term sustainability as global leaders in the coffee industry without the CEO there is extensive delegation of authority to people who have proved to possess brilliant ideas about management.

Starbucks Company has successfully established their brand in the coffee industry thanks to the organizational culture of the firm, which is its distinct characteristic. Both the current and previous CEOs have worked together with the management and junior team to ensure the culture of the organization is upheld. The support that the management and supervisor accord to workers is what increases efficiency at work. Typically, the growth of the company is tied to the growth of employees (Schein, 2010). Hence the management has embraced the employee-first approach. Other than the culture of the organization, the company also offers other innovations to customers such as the Starbucks digital network, which has helped attract new customers as well as ensured customer loyalty. Starbuck remains leader in the coffee industry, and for as long as it upholds its organizational culture, it will always be yards ahead of others.



Koehn, N. F., Besharov, M., & Miller, K. (2008). Starbucks coffee company in the 21st century. Harvard Business School, Case Study, 9-808.

Koehn, N. F., & Grundy, W. (2001). Howard Schultz and Starbucks Coffee Company (TN).

Miller, C. C. (2010). Aiming at Rivals, Starbucks Will Offer Free Wi-Fi. The New York Times [New York].

Schein, E. H. (2010). Organizational culture and leadership (Vol. 2). John Wiley & Sons


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