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Starbucks - Business - Case Study Example

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Starbucks is an international coffee chain restaurant which is located in US and other regions. It is the world largest coffee company with handling 17, 000 stores in 49 countries. It is specializes in selling beverages like coffee, tea and variety of food items to the worldwide customers…
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Starbucks - Business
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Download file to see previous pages The strategic business environment of Starbucks has been transformed in to a more complex and diverse phenomenon with its independent approach to managing an internationally diverse strategic operational environment. As the strategic analysis shows Starbucks has been highly affected by a variety of internal and external operational environmental influences. However its strategic environment as divided in to product and marketing strategy, competition strategy, growth strategy and financial strategy indicates that the organization has been faced with many constraints.
Future of the company's sales strategy depends on the current market related outcomes as well as the strategic initiates being adopted at the organizational level. Predictably the company would be able to turn around in respect of costs and efficiency under the stewardship of Shultz (CEO at Starbucks) though how soon is not clear. In the first place the current economic downturn has forced the company to diversify its average portfolio of products, e.g. the launch of VIA Ready Brew and value meals. These product innovations would have a very good impact on the sales volumes for sure but how would they impact on the relative profitability of the company isn't known yet.
Organizational success is determined by the internal strengths of the organization in which controlling, rationalizing and utilizing the available resources to achieve the maximum productivity and the associated organizational goals through competitive advantage are the predominant activities. Thus Starbucks has the highly calibrated capital, trained employees and networks in the form of strategic intelligence about markets, finances, operations, techniques and HR management. Its capacity building and enhancement strategies have known to be sound and its core competencies have been built around this formulaic strength-weakness determination paradigm. Despite this position of Starbucks as a pioneer of costly-to-copy resource development processes still there is competition coming from rivals who have been able to imitate the same product by reducing its cost and using advanced technology, e.g. online ordering related techniques.
While many market analysts have pointed out the existence of a downturn related sales curve at Starbucks in the coming months, Shultz is determined to turn around its growth trajectory to hit some predetermined sales targets (Serwer, & Bonamici, 2004). According to analysts there is a very strong suggestion for product innovation accompanied by cost cutting efforts. The former has been happening thought then latter has yet to happen. Fast food chains have not given up on their own product diversification and innovation strategy. This is cited as one of the major challenges to Starbucks. McDonald's, Burger King and KFC have reinvented their standard formulas.

2.2 Marketing
Despite these constraints in its organizational environment, Starbucks has successfully initiated some far reaching policy related outcomes. For instance Starbuck's product and marketing strategy have been oriented towards achieving a series of positive M&A related synergies including growth and competitive capabilities. Starbuck's competition strategy is basically related to its product and marketing strategies.
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