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Starbucks Clouds Case Study

Essay by   •  January 28, 2012  •  Case Study  •  1,771 Words (8 Pages)  •  1,328 Views

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Starbucks clouds case study

Customer Inserts His/her Name

Customer Inserts Grade Course

Customer Inserts Tutor's Name

(July 30, 2011)


A. Executive summary

* The paper deals with history of Starbucks

* It deals with present state of service operations

* It identifies recommendations for problems identified

B. Background

* Customer experience was the core objective

* Problem statement

* Customer experience and interpersonal skills are lacking

C. Analysis

* Employees lack interpersonal skills

* Focus on efficiency has led to the loss of customer experience

D. Recommendations

* Employee training

* Employment of locals

E. Conclusion

* Starbucks lacks the customer experience as it had before

Executive summary

This paper looks at the history of Starbucks as well as the current situation of the company. The focus of the paper is on the principles on which the company was created and this is tackled in the background section of this paper. Besides the background, this paper identifies that Starbucks has had many problems relating to service operations. These problems are summarized in the statement of the problem section and they are dealt with in detail under the analysis section. As will be identified in this section, the service operations problems of the Starbucks relate to cultural, labor as well as machine issues which have not been solved by the company. In the recommendations section, the issues discussed and problems identified find their solutions as the paper in this section provides the potential way-out for the company to curb the problems discussed. Under the section of conclusion, the paper is summarized by looking at all issues discussed.


Starbucks was founded in 1971 in Seattle, Washington. The founding of the company was by friends Jerry Baldwine, Siegal Zev as well as Gordon Bowker. The principle founding of the company was an answer to the romantic stories of a person's love for coffee. Built on this round, people immediately loved and associated with the company as one which provides an experience with coffee. It did not take so long for the company to build six more locations. These locations were also in Seattle. Overall, the momentum for expansion by the company has been kept for a long time.

In 1982 Howard Schultz joined the company as retail operations director. In Italy, he observed the operations of a certain machine called Italian espresso bars and intended to bring the idea to Seattle. He was able to convince the Bowker, Baldwin and Siegal, but was unable to incorporate it into company's operations. Schultz purchased the company for $4 million and merged with Giornale II in 1987 and opened up 17 stores (Zimmerman, 2007). In the preceding years, expansion was in its earnest. Other stores were opened up in 1989 in Oregon, Portland. From this time onward, the management of the company has been concerned with the ideas of efficiency of service operations against maintaining the experience for which the company was founded on.

Problem Statement

The company faces the problem of achieving a customer service experience as well as interpersonal experience.


Starbucks has faced many problems relating to service operations. These problems are domestic as well as international. The emergence of these problems has been because of the operating environment of the company which has had considerably expanded. With the increasing expansion, management of the service operations became a challenge. This is because entering the global market affected the resource base as well as questioned on the adaptability of the company to work on unfamiliar grounds. With such expansion, labor, capital and such become increasingly scarce and presented the challenge of being fulfilled (Burks-Busing, 2009). These conditions being created meant that the both the domestic and international operations could not be effectively abridged to meet the objectives of the company as well as fulfill the primary objectives of the consumers which made the operation of the company difficult.

Employee service

The objective of Starbucks has been to offer service to the customer which is customer friendly. In North America, the company has to some level achieved this. The development of this friendly atmosphere in the Starbucks stores throughout the world has however been a challenge. One problem that has been identified by the company is that the employees coming in have not mastered enough on the skills of addressing the customer in the friendly way. It has been identified that even the industry level interpersonal skills had not been acquired by some employees. This was to be a great challenge to the service operations of the company. This is especially because this very ideal is the one on which the company's brand is built (Zimmerman, 2007).

The company, having identified that a foundational service operation objective was being missed decided to heavily invest in programs aimed at bringing the employee skills and typology of behavior to the level desired by the company to achieve the objectives. These programs were mainly hiring and training programs. These training programs however did not bear



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