Starbuck's Knowledge Management System - Case Study Example

STARBUCK’S KNOWLEDGE MANAGEMENT SYSTEM Student’s Name: Code + Course name Professor’s name University City, State Date Introduction Proper communication and transfer of knowledge between Starbucks stakeholders provides an explanation for the regular influx of customers into the firm in huge numbers despite the fact that the company has overpriced its coffee. The upbeat environment and the helpful and friendly staff that characterise Starbucks also explains the preference of the company to other coffee shops (Roby 2011). It is evident that the company’s competitive advantage emanates from the ability of its knowledge management system to respond to the inquiries and questions of the customers pertaining its coffee or services. The review contains two parts: Part A and Part B. The first part provides a review of the knowledge management system of Starbucks Company. The second part provides a KMS strategy that the company can implement to refine and improve its full KMS. Part A The Structure of Knowledge management at Starbucks Company Starbucks as a multinational company considers knowledge management as very significant. Starbucks believes that the customers hold the secret to its success in knowledge management. This explains the reason why the firm decided to switch to the social media as a way of luring customers to purchase its products in 2008. The use of the social media yielded positive results for the company since it was able to obtain 41,000 ideas from customers that enabled it to enhance the delivery of its services and provide additional coffee and tea varieties to meet customer demands. The Use of IT in Knowledge management The feedback from the staff concerning the knowledge management system at Starbucks disclosed that IT is pivotal support element in knowledge management. The staff disclosed that based on the fact the company is a multinational organization, knowledge management cannot be effected without information technology. For instance, the decision of the company to utilize IT to connect to customers impacted positively on its performance since it was able to connect to obtain different ideas from its consumers through the MyStarbucksIdea.com website (York 2010). Starbucks uses Twitter as one of the social networks to communicate with its customers. The tweets are a combination of both photos and texts. The information that the company conveys to its customers via the tweets consists of the major events, products and services even though customers seek to know about the company’s products and services mainly. However, the company provides information about the events since such events provide information about the launch of a new product. Customers also express their likes, dislikes and expectations via the tweets. A good example of a tweet posted by the company intended to inform customers that they could mix peppermint syrup + java chips + green tea to obtain minty goodness. According to Noff (2009), Starbucks responds to at least ten tweets from its customers on a daily basis. The company considers tweets regarding its products and services as an issue of concern that requires immediate investigation to respond to the noted customer concerns. Another case involving the use of IT is the company’s regular use of Facebook to provide information about its locations, products and organizational cultures with the intention of maintaining the awareness of its customers about the changes in the organization. Posts such as “A free 12oz drink…Ends today” and “drive-thru now accepting mobile payments” reveal the firm’s use of Facebook to keep customers abreast of its ongoing changes in services. The other example of the company’s use of Facebook is the promotion of the “Frappuccino happy hour” that saw the company sell one Frappuccino in every 15 seconds (Warren 2011). The firm also uses poll questions to obtain customer preferences about a product or service. Facebook also acts as a platform through which the company obtains customer feedback and personal opinions about the company, its products and services. Through the customer feedbacks, Starbucks is able to comprehend the reaction of customers to new products, customer preferences, behaviours, expectations, and satisfaction levels. The firm also uses Foursquare to provide information about its day-to-day events such as the launch of a new product or offers in a specific location. The Foursquare platform also enables the company to offer discounts and free drinks to its customers. However, the company website stands out as one of the most important communication platforms that enables consumers to ask questions, reveal their frustrations about the company’s products and offer new ideas (Chua & Banerjee,2013). INCLUDEPICTURE "http://image.slidesharecdn.com/starbucksfinalppt-100429053803-phpapp02/95/starbucks-international-marketing-strategy-31-728.jpg?cb=1272520697" \* MERGEFORMATINET Figure I: The Use of IT in Knowledge Management at Starbucks As shown in the figure above, Starbucks uses the corporate IT system to store, organise and retrieve information. For instance, it stores information about its sales, inventory and staffing in its individual stores. It also stores information about its transfers in the stores. The firm also utilises the corporate IT system to store, organise and retrieve information concerning its orders, budgets and future sales prepared by the vendors, distributors, management and channel members. A knowledgeable customer is therefore considered to be a very valuable partner in business. This explains the reason why Starbucks attaches the highest level of significance to customer feedback regarding its products and services. The company understands that its failure to respond to customer complaints and concerns will compel them to seek alternative products from its market rivals such as McDonald’s. Based on the already established communication platforms, I think that Starbucks has an effective knowledge management system as evidenced by its ability to attain competitive advantage by utilising the knowledge obtained from its KMS. Part B The New and Refined KMS Process It is proper to state that the new and refined KMS ought to encompass all the seven essential steps necessary for the development and implementation of an effective knowledge management system. At the onset of the development process, it would be appropriate for Starbucks to conduct an assessment of the knowledge that it requires in the system. Apparently, it is evident from the review that the company already understands the knowledge that it requires in the system. For instance, it has endeavoured to obtain information regarding customer preferences, expectations and reactions towards the products and services of the company. It is imperative for the new KMS to seek to find such information. Moreover, the new KMS process should provide information regarding the scheduling of major events and offers on a timely basis via the website, fourscore platform, Twitter and Facebook to ascertain that customers can attend or follow up the events. The system should utilise scenario planning to forecast the future competitive environment of the industry thus enable it to have all the pertinent information that it requires for its continued success in the industry. The KMS process should also guarantee a continuous assessment of the degree of sharing and retention of the knowledge. By so doing, Starbucks will be in a position of understanding the amount of retained knowledge and identify the potential weaknesses associated with knowledge sharing, storage, retention and transfer. Therefore, it is proper for Starbucks to conduct a social network analysis that would enable it to identify all the people that exist both inside and outside the company that portray shared goals and objectives. Such individuals can learn from one another, share information and help one another. The new KMS should achieve positive results on the test to ascertain enhanced connectivity. Apparently, including members of the senior management in the KMS is imperative since it implies that the project has the support that it requires from the senior managers of the organisation. The next step entails designing the technologies and tools of integrating the KMS into the organisation. Since there is an existing knowledge database in the company, the new KMS should target to increase the ROI on the existing knowledge by using text-based electronic repositories that contain retrieval and advanced search capabilities. Using a meta-search software can be paramount in achieving the objective. The KMS should also target to foster the process of accessing the required knowledge. In order to achieve the objective, it is imperative that the company should use a knowledge mining software that permits the clustering and sorting of query results based on the pre-defined categories that meet the set objectives of the company pertaining the required knowledge. The new KMS should also ascertain the speed and accuracy of knowledge classification. For instance, Starbucks can classify knowledge in groups of products, services, events, offers among others to enhance the speed of access to the intended category. Automatic categorisation tools are effective in categorising the information. The new system should run the automated categorisation software in the existing knowledge database and the incoming knowledge streams to group the knowledge into the required categories. The functionality, performance and security of the knowledge management function at Starbucks is the other issue that the new KMS should consider. In the quest to achieve the objective, it is mandatory that the KMS should contain knowledge warehouses. The warehouses should use knowledge filters to integrate the existing knowledge silos into the new warehouses while allowing automatic updates to the system and preserving the original information and its sources. By so doing, the filters enable the company to retrieve the original information even after the changing or augmentation of the new warehouse. The knowledge warehouse should also avail information about the source and author of the information. Most importantly, the warehouses should be available to the company. The firm should also capture “tacit” knowledge to enhance the contribution of knowledge to the warehouse. In order to achieve the goal, the KMS should use form-based contribution of its information assets. By so doing, the KMS would allow end users to contribute substantial knowledge directly to the system. The KMS should also use intranet forms in the creation and deployment of frequently-used knowledge assets. Such forms may include research notes, news articles, resumes and best practices. Finally, the KMS should have a knowledge mapping software that enhances the speed of access to critical knowledge. The principal rationale of using the software is the need to reduce the risks associated with the failure of customers to find critical information. The chart below provides a generalised outlook of the company intranet. Figure 2: Starbucks Corporate Intranet However, only the data-handling professionals and the management of Starbucks would be in a position of accessing all the tabs of the intranet. The other users of the system such as the customers and other employees would only access the knowledge portal that would require them to log in prior to accessing knowledge regarding the existing products, events, and offers. The knowledge services will enable the users to access the existing services offered by the company. The knowledge desktop will link the users directly to the Starbuck’s homepage. The search and deliver tab will enable users to search for their favourite coffee and tea varieties in their selected coffee shops and restaurants. Customers that intend to provide feedback about the products and services would use the collaboration tab. Finally, only the management and data handling professionals would gain access to the remaining tabs. Conclusion Knowledge management plays a pivotal role to the ability of corporations to attain competitive advantage. Starbucks Company has already established a KMS system that utilises the corporate website, Facebook, Twitter and the foursquare platform to communicate with its customers thereby obtaining pertinent information regarding its products and services. However, it is proper for the company to implement a new KMS that would enhance the functionality of its knowledge function. A corporate intranet would serve to avail the required information. It should enable the users to provide their feedback regarding the products and services of the company besides enabling the company to track the flow of its knowledge warehouse. Reference List Chua, A Y & Banerjee, S 2013, ‘Customer knowledge management via social media: the case of Starbucks’, Journal of Knowledge Management, vol. 17, no. 2, pp. 237-249. Noff, A 2009, ‘Learning from Starbucks – one tweet at a time’. Available from: https://www.blonde20.com/blog/2009/11/19/learning-from-starbucks-one-tweet-at-atime/ Roby, L R 2011, ‘An Analysis of Starbucks as a Company and an International Business’. Warren, K 2011, ‘Starbucks’ social media strategy’, Business Review, pp. 34-43. York, E B 2010, ‘Starbucks gets its business brewing again with social media’, Advertising Age. Available from: http://vandymkting.typepad.com/files/2010-2-22-advertising-age-starbuks-gets-itsbusiness-brewing-again-with-social-media.pdf Read More