Advantages and Disadvantages of Starbucks Motivation System - Case Study Example

Advantages and disadvantages of Starbucks’ motivation system Name Institution Due Date Introduction Employee motivation refers to the level of commitment, creativity and energy that a corporation’s employees apply to their work. Due to rapid globalization over the past few years, competition around the globe has become more immense; particularly for service industry with identical products and finding the best schemes of employee motivation has become an imperative concern for several managers. In the real sense, numerous methods and theories of employee motivation have surfaced, ranging from training and employee empowerment to monetary incentives. The most vital point for the success of any company is the quality of services and goods it supply, and also the right personnel to deliver these products. Therefore, it is important for organizations to motivate, train and reward employees to make them best quality personnel. Starbucks Corporation is the most well-known chain of retell shops in several forms of tea and coffee drinks. Starbucks’ motivation system has enabled the corporation to attract and retain motivated, loyal and productive employees. Advantages and disadvantages of starbucks’ motivation system Creativity and innovation Since the establishment of Starbucks, innovation has been a continuous value in the Corporation. Howard Schultz, the chairman and CEO of starbucks initiated the place-like-home amid the office and the home, where employees gather around superior teas and coffees and development and research efforts with partners like PepsiCo. In 1995, Starbucks established the stores of future team to investigate the subsequent invention of store design1. This team created four templates, one for every of the four phases of coffee production, and blended colors, lighting materials and scheme. The team also developed the brevebar, which is a store inside a store for the supermarkets, or the office building lobbies, as well as doppio, which is a self contained eight square foot room that is movable from one location to another. These innovations enabled Starbucks to considerably minimize costs of store opening and equate them with the sales that every store format would permit. The product line of Starbucks was also the demonstration of its innovation capacities.2 Through innovation, the company has been able to offer a wide range of decaffeinated or regular coffee beverages, Italian- fashion espresso drinks, along with a broad selection whole- bean fresh -roasted coffee. In numerous organizations, workers with creative ideas don’t express them to the management for the fear that their contribution will be ridiculed or ignored. Creativity and innovation is a useful scheme, because it offers employees who know a product, service or job the chance to utilize their thoughts to improve it. The authority to create motivates workers and benefits the corporation in possessing a highly flexible workforce, wisely utilizing experience of the employees and increasing exchange of information and ideas among departments and employees. These improvements are also essential in the creation of openness to change that might offer the corporation the capability to rapidly respond to market changes and maintain a position in marketplace3. Employee involvement and empowerment During the initial building years, the management of Starbucks management was passionate about the significance of pleasing their customers. Workers were coached on going out their way, to take valiant measures where necessary and to make sure that customers were completely satisfied. Workers were also persuaded to speak out their minds without the fear of reprisal from senior management. Senior executives required workers to be vocal on what Starbucks Corporation was doing correctly, what it wasn’t doing correctly, and what reforms were required. The management needed workers to make contributions to the procedure of developing Starbucks into a better corporation. Involving workers in policy changes and decision that affect their jobs, whilst empowering ten to be highly independent, largely improves morale4. The major disadvantage of involvement and empowerment is that some employees might not be capable to mange the additional work that additional decision making and responsibility brings. Numerous workers might take advantage novel responsibility and misuse their power. Therefore, it is significant for the management to ensure that workers are entirely informed of and ready for decision making responsibilities before being empowered5. Monetary rewards Good compensation along with an inclusive benefit package is a method that Starbucks use in motivating employees. Schultz’s approach of offering workers monetary rewards has been propelled by the conviction that sharing the success of the corporation with individuals who make it happen assists every employee to act and think like a owner, develop optimistic long term relations with consumers, to do work effectively. The employee benefits program of the company is predicated on the conviction that better payments attract talented and excellent individuals and enable them to work longer in an organization. The Rationale of Schultz was that if the management treats its staff well, the employees will in turn treat the customers well6. Some employees are mainly motivate through monetary rewards, and will radically improve their performance so as to attain such rewards. Merit based bonuses and pays are great employee motivators but the organization should not merely give them out, but should give them as a reward or incentive for excellent performance. The sharing of the corporation’s profits offers incentive to workers to produce superior products, perform quality services, and improve quality of a project within the organization. What is beneficial to the organization has a direct benefit to the employees. Financial and other incentives are usually to workers for the generation of cost savings or system improving ideas, so as to improve performance and minimize absenteeism. Monetary rewards are efficient when they are directly connected to the accomplishments or ideas of an employee7. However, some workers are not motivated by monetary rewards, and may view motivation through money as vulgar, and become disincented by these offers. These types of employees are likely to be highly motivated work more hard by the utilization of non financial rewards like being thanked publicly at departmental functions, giving views on the progress of the organization or getting an additional day off8. The most successful motivators of employees are nonmonetary. Financial schemes are not sufficient motivators, because expectations usually surpass outcomes and because differences amid salaried individuals might divide other than unite workers. An employee monetary reward program with the aim of reducing turnover and motivating employees may be counterproductive and costly. Workers who are not engaged or who have reduced morale are highly likely to select satisfying working relations together with challenging job assignments over financial rewards9. Employees’ needs and quality of life Starbucks’ employees need to have an understanding of the products of the company, be enthusiastic on the organization’s ardor for coffee and also possess personality and skills to offer fashionable customer service. Starbucks’ employees requested extension of health care benefits to part time employees as a key strategy to wining commitment and loyalty of employees to the organization’s mission. Schultz believes that improving employees’ support builds confidence, minimizes turnover and subsequently lessens training and hiring costs. Starbucks uses health care benefits to both part time and full time workers. The health care coverage includes part time employees who work at least twenty hours in a week. This health care coverage is a an indication that the company respects their involvement and impact. Because majority of Starbucks workers’ are young and relatively healthy, the corporation has been capable to offer wider coverage whilst maintaining monthly payments comparatively low10 Starbucks treat every employee equally and all of the workers are referred to as partners. The company possesses a superiorly organized channel of communication and also places more importance on labor. For instance, the management plans working hours per employees and arranges a schedule for off time, in accordance to the needs of employees. Interviews are conducted weekly to establish the needs of employees and a unique survey known as partner view survey is conducted after two years. The managers get feedbacks through this event on the job requirements of the employees. Starbucks employees have the authority to establish what policy best fits them, and directors display a respect for every suggestion11. Training and development Training and development is a significant key factor for the Starbucks’ success. The company needs passionate individuals who have affection for coffee and thus looks for a varied labor force, which reflects Starbucks’ community. The company wants individuals who get pleasure from what they are doing and who view their jobs as extension of themselves12. Every employee receives classes in Starbucks coffee school on drink preparation, coffee history, retail skills, customer service and coffee knowledge. Starbucks’ training is efficient at educating new workers on how to utilize cash register, measuring beans and proper opening of bags, and capturing beans without dropping them on the ground. Managers are also offered deeper training on stores operations, procedures and practices, basis of employees’ management and information systems. These training plans alongside pay scale above average, enables the company to attract motivated employees with excellent working habits and above average skills13. Training and development as a scheme of employee motivation is disadvantageous in that when majority of organizations are sponsoring training of employees, they confine to topics which serve the short term interest of the organization. This is contrary to the long term concerns of the company and the organization. Workers lose out on attaining broad based and generic skills, while the organization miss out the opportunity of the worker to utilize new knowledge to strengthen the company out of chains of conventions through applying innovation and creativity. Teamwork As a globally recognized hospitality chain, Starbucks is known for its capability to maintain customers and a comparatively low rate of turnover. Team work is offered a momentum significance because believe management believes that teamwork is a key contributor to the holistic success of the organization. Teamwork constructs a social structure in a company for staff to socialize, and also a composite of several forms of individuals who equip with diverse background of acquaintance and skill on account of the organizational mission. Every team member plays a significant role in the team, and thus all individuals within the team are able to meet their needs through getting acquainted with diverse coworkers and learn novel skills from one another14. Starbucks managers refer to the employees as partners and this leads to the bridging of the business gap of title. Managers of units work together with employees at front line of service and this demonstrates lack of discrimination at work, which in turn results to self respecting, motivated staff who loves their work. This is passed on through the workers to the customers, generating loyalty and satisfaction15. In addition, team work generates an open environment in which employees are able to express innovative thinking. A team is usually made up of three to six employees and this enables employees to deeply and easily acquaint with one another. During the co-working times, employees are able to match their diverse personalities and majors so as to rapidly attain good performance. Teamwork is also helpful in strengthening relationships and building of friendships and unity. Relationships help individuals to effectively communicate with one another, while friendships lead to job satisfaction. Individuals develop a superior feeling of responsibility whey they are a portion of a team since members of the team depend on one another for success16. Teamwork is disadvantageous because it cal result to unequal participation due to the tendency of some employees sitting back and letting others do majority of the job. This can results to conflicts amongst employees, which might have harmful impacts on workplace morale. Also, resentment might occur in the company, particularly if the management only recognizes tem efforts other that efforts of the team leaders17.Another disadvantage of teamwork is that, some employees are not team players and might not work well as a portion of team, with the preference of working on their own. Teamwork also leads to limited creativity and consequent innovation because it limits creative thinking. Workers might be more focused on performing for the entire good of a team and fit into the team concept while putting their individual ideas to themselves18. Conclusion Starbucks uses numerous methods of employee motivation such as training and development, teamwork, creativity and innovation and employee involvement and empowerment. These systems of motivation have enabled the company to attract and retain motivated employees who are able to offer quality services and products in the hospitality chain. Starbucks’ motivation system views and treats workers as assets when workers are treated as assets and their inputs, ideas and decisions considered, they feel that they are a part of the organization, a feeling that increases their loyalty, commitment and productivity. References Thompson, A., & Gamble, J., Starbucks Corporation, retrieved on http://www.mhhe.com/business/management/thempson/11e/case/starbucks.html. Michelli, J., (2006). The Starbucks’ experience: 5 principles for turning ordinary into extraordinary. New York: McGraw-Hill. Goldstein, J., & Behar, H., (2007). It’s not about the coffee: Leadership principles from a life at Starbucks. New York, NY: Portfolio. Murrell, K., & Meredith, M., (2000). Empowering employees. New York: McGraw-Hill. Sprinkle, G., & Bonner, E., (2002). The effects of monetary incentives of effort and task performance: Theories, evidence and a framework for research. Accounting, organizations and society 27 (5): 330-345. Robbins, P., (2005). Organizational behavior. New Jersey: Prentice-Hall, PearsonEducation Inc. NYSE Group., (2007). Starbucks Corporation. Retrieved on November 16, 2011 from http://www.nyse.com. Montana, T., (2005). How Starbucks energizes its employees. Retrieved on November 16, 2011 from http://www.bizjournals.com. Parker, O., (2001). Pay and Employee Commitment. Ivey Business Journal 65(3), 70-79. Craig, P., & Ensley, M., (2004). A reciprocal and longitudinal investigation of the innovation process. Journal of Organizational Behavior, 25, 259-278. Carsten , W., & West, A., (2001).. Minority dissent and team innovation: The importance of participation in decision making. Journal of Applied Psychology, 86(6), 1191-1201. Read More