pdt - starbucks
DESCRIPTION
hytjncdrefcTRANSCRIPT
1
Marking Scheme
Group Component (70%)
Assumption 10%
Coherence 10%
Diagram & Figures 10%
Analysis 10%
Format 10%
Reference 10%
Presentation of Deliverables 10%
Individual Reflection (30%)
Report Content 20%
Reflection 10%
Total (100%)
PROFESSIONAL ENTERPRISE DEVELOPMENT GROUP ASSIGNMENT – STARBUCKS
2
Workload Matrix
Name Task
Chuah Cheng Jun - Introduction- Organisational Structure
Gunaseelan A/L Ramachandran - Conclusion- Professional issue and Computer
Ethics
Cheong Gze Xie - Executive Summary- Organisation Culture
Agha Naqeeb - Overall Recommendation- Organisation Socialisation and
Mentoring
PROFESSIONAL ENTERPRISE DEVELOPMENT GROUP ASSIGNMENT – STARBUCKS
3
Assumptions
No. Area Assumptions
1. Organisational Structure It is assume that Starbucks having a matrix structure is to maximise communication channel between the customers, partner and leader to focus on customer experience (Schultz, 2008)
2. Organisational Culture Based on the principle in Starbucks, it is assume that Starbucks are running adhocracy culture with flexibility over stability. (Starbucks, n.d)
3. Organisation Socialisation and Mentoring
It is assume that Starbucks mostly focused on mentoring for new recruits because their aims and objective is to train every employee that enhances their confidence and competence in delivering customer service. (Starbucks, n.d)
4. Professional Issues and Computer Ethics It is assume that Starbucks has an issue on encryption vulnerability that causes information leakage. (Ingham, 2014)
PROFESSIONAL ENTERPRISE DEVELOPMENT GROUP ASSIGNMENT – STARBUCKS
4
Table of ContentsMarking Scheme.............................................................................................................................1
Workload Matrix............................................................................................................................2
Assumptions...................................................................................................................................3
Executive Summary........................................................................................................................6
Introduction....................................................................................................................................7
1.0 Organisational Structure.....................................................................................................8
a. Functional Structure............................................................................................................8
b. Divisional Structure............................................................................................................9
c. Matrix Structure................................................................................................................11
1.1 Starbucks Organisational Structure...................................................................................12
1.2 How does Organisational Structure Affecting Starbucks..................................................14
1.3 Limitations and Recommendation....................................................................................17
2.0 Organisational Culture......................................................................................................18
a. Clan Culture......................................................................................................................19
b. Adhocracy Culture............................................................................................................19
c. Market Culture..................................................................................................................19
d. Hierarchy Culture.............................................................................................................19
2.1 Starbucks Organisational Culture and How It’s Affecting Starbucks...............................20
2.2 Limitation and Recommendation......................................................................................23
3.0 Organisation socialisation and Mentoring.........................................................................24
a. Organisation Socialisation................................................................................................24
b. Mentoring.........................................................................................................................25
3.1 Starbucks Organisation Socialisation and Mentoring........................................................27
4.0 Professional Issue and Computer Ethics...........................................................................28
a. Fair Employment Practices and Diversity.........................................................................28
b. Discrimination and Harassment........................................................................................28
c. Privacy on the Web...........................................................................................................28
d. Encryption........................................................................................................................29
4.1 Recommendations.............................................................................................................30
Overall Recommendation for Starbucks.......................................................................................31
Conclusion....................................................................................................................................32
PROFESSIONAL ENTERPRISE DEVELOPMENT GROUP ASSIGNMENT – STARBUCKS
5
References....................................................................................................................................33
Executive Summary
The main objective of this report is to research and analyse the organisation structure,
culture, socialisation, mentoring and professional issues and ethics of Starbucks based on
its customer service. This report is limited to Starbucks themselves, not involving any
third party or other products/services.
Information was gathered mainly from articles and websites and analysed to find out the
impact of organisational structure, culture, mentor and ethics issues towards Starbucks
customer service. The research in this report is divided into 4 sections as following:
The organisational structure of Starbucks is a matrix structure that would maximise
the communication channel and bond every employees and customers together.
The organisational culture of Starbucks is adhocracy culture that focus on flexibility
and external environment.
The mentoring in Starbucks has done good to make sure every employees especially
the baristas are well-trained to be confident and skilful in order to serve the customer.
The Starbucks mobile apps has led to serious vulnerability issue that third party able
to access owner’s information.
The analysis found that Starbucks treats every employee equally and giving them much
benefits being a partner with them. This would increase the satisfaction of the partners,
indirectly promoting and willing to serve customer in a good manner. Their flexibility has
made Starbucks to gain more customer as they can get any taste of coffee they want as
long there are ingredients for it. Furthermore, mentoring of 1-to-1 basic has made it more
efficiently leading and teaching mentee.
Recommendations for Starbucks is to have a managerial staff possessing a good
leadership skills in order to lead the department to avoid confusion and giving out
authority, improvement on privacy issues and the type of beverages is limited due to
geographical areas.
PROFESSIONAL ENTERPRISE DEVELOPMENT GROUP ASSIGNMENT – STARBUCKS
6
Introduction
Starbucks Corporation, also known as Starbucks Coffee is an American global coffee
company which has around 20,000 outlets in 64 countries worldwide. Starbucks is
primarily known for serving a variety of coffees, but also sells other beverages from hot
to cold, full-leaf teas, fruit juices, pastries and snacks. They also selling items such as
mugs and tumblers that offers RM2 discount whenever the tumbler is used for ordering
drink, this is to minimizing the usage of cups. On special occasion such as Chinese New
Year or Mid Autumn Festival, they would have different limited edition of Starbucks
card, tumblers and even mooncakes for Mid Autumn Festival!
In this assignment, we are going to focus on Starbucks customer service. Starbucks trains
their partner to say “yes” to any requests made from their customer. Barista always tries
to remember the favour drink of a specific customer, they really try to go beyond to make
you really feel that you are an individual with a name labelled with your preferred drink
(businessholic.net, n.d). It is part of Starbucks culture. We are going to analyse how the
organisational structure, culture and socialisation going to affect the customer services
towards customers.
PROFESSIONAL ENTERPRISE DEVELOPMENT GROUP ASSIGNMENT – STARBUCKS
7
1.0 Organisational Structure
Organisational structure is a system used to define a hierarchy within an organisation.
(Friend, n.d). It refers to different levels of management and division of responsibility,
together they operates and assists the organisation to obtain its goals and missions. The
structure is demonstrated in an organisational chart.
There are total 3 types of organisational structure which is functional, matrix and
divisional structures. Every structure has it owns advantages and disadvantages that will
bring direct impact to an organisation. Every entrepreneur has to decide and think wisely
which structure fits for their organisation.
a. Functional Structure
Functional structure is known as grouping individuals into organisational units according
to the function they perform. Such as staff that are dealing with customers complains and
issue will belong to the Customer Service department. Every department has 1 manager
reporting directly to the CEO or Board of Directors.
Figure 1.0(A) 1: Functional structure (Technologyuk.net, n.d)
The advantage is pooling all similar resources and people sharing a common expertise on
the particular field in order to max out the efficiency of these resources. The disadvantage
is communication and coordination restrictions may occur between departments because
working separately and hard to achieve some organisational goals.
PROFESSIONAL ENTERPRISE DEVELOPMENT GROUP ASSIGNMENT – STARBUCKS
8
b. Divisional Structure
Divisional structure mostly found in large companies that operate in wide geographic
area, having subsidiary company or a large chain of products or services. This structure
divide the functional areas of the organisation to division in order to handle and focus the
specific needs of the particular area. Each division is equipped with its own resources in
order to function independently (tutorialspoint.com, n.d). Divisional structure can be
broken down into three areas which is geographical division (Figure 2), product
division (Figure 3) and marketing division (Figure 4).
Figure 1.0(B) 1: Geographical Division (lardbucket.org, n.d)
Figure 1.0(B) 2: Product Division (tutorialspoint.com, n.d)
PROFESSIONAL ENTERPRISE DEVELOPMENT GROUP ASSIGNMENT – STARBUCKS
9
Figure 1.0(B) 3: Marketing Division (Distelzweig, n.d)
From the three figures above we can see that almost every division shares the same
functional groups and have a president or vice president controlling that division which
more likely the division will receive resources from the headquarter (Gillikin, n,d). The
drawback of this structure is communication is inhibited between divisions as employee
are not working together. This structure is costly because it requires more expertise and
resources to handle every single products/area/market.
PROFESSIONAL ENTERPRISE DEVELOPMENT GROUP ASSIGNMENT – STARBUCKS
10
c. Matrix Structure
Matrix structure is the combination of functional and division structures to max out its
advantages in order to carry out company operations. From the figure below (Figure 5),
the vertical structure act as a functional structure while the horizontal act as a division
structure. Employees are still reporting to own functional managers but in the same time
they are also supporting the respective production team when needed. This not only
utilise the human resources but also departments able to work together and communicate.
Figure 1.0(C) 1: Matrix Structure (kfknowledgebank.kaplan.co.uk, n.d)
The disadvantage is the internal complexity of this structure. Some employees may
become confused to whom should they report to. If miscommunication and misleading
occurs, this could result in employee dissatisfaction. Furthermore, the workload of an
employee may increase when he needs to focus on this functional job, while also
focusing on the respective production team. This brings down the motivation and passion
of the employee too.
PROFESSIONAL ENTERPRISE DEVELOPMENT GROUP ASSIGNMENT – STARBUCKS
11
1.1 Starbucks Organisational Structure
Starbucks current organisational design is a hybrid organisational design, encompassing a
division geographical structure and a functional structure which defined as matrix
structure. Starbucks is then broken down into 3 geographical regions globally which is
the China and Asia, America and EMEA (Europe, U.K, Middle East, Russia and Africa)
(figure 6) and 4 geographical regions in the United States (figure 7) and this allows it to
target the varying geographical markets quite differently based on each location, culture,
climate, and lifestyle. Each division will be led by a senior vice president, reporting
directly to the U.S President (Schultz, 2008).
PROFESSIONAL ENTERPRISE DEVELOPMENT GROUP ASSIGNMENT – STARBUCKS
12
Figure 1.1.1: Starbucks International Organisational Structure. (self made)
Figure 1.1.2: Starbucks US Organisational Structure (Self made)
PROFESSIONAL ENTERPRISE DEVELOPMENT GROUP ASSIGNMENT – STARBUCKS
13
1.2 How does Organisational Structure Affecting Starbucks
Starbucks choose matrix structure for its organisational structure is to maintain all
communication channels are being well maintained. Before Howard Schultz taking back
the role of CEO in Starbucks at January 2008, Starbucks has moved away from its actual
mission which is the customer experience due to rapid expansion of outlet before 2008.
After Schultz take over Starbucks, he immediately reorganised the whole organisation
structure to matrix, adding and changing some functions that allows leadership to be
closer to the customers.
Matrix structure has the advantages of maximising communication channels from
upward, downward and laterally with its employee which allow them to be actively
communicate. Schultz believes if partners are well taken care in communication rich
environment where they are respected, then they will enrich the lives and truly connect
with the customers (Owens, Shirley, Smith & Wagner, n.d). This could enhance the
overall customer experience in Starbucks. A good example of this can be seen in a recent
posting of the structural changes the organization made in order to maintain stability and
continue excellent customer service (Shultz, 2008).
This structure is also counted as decentralised structure which authorise the partners to
making own decision and building up responsibility, the manager also able to ensures that
all employees especially the barista which directly dealing with the customer carry out
their tasks perfectly.
According to BrandAutopsy.com (2011), Starbucks always remind its partners that the
customers are always their bosses and every hierarchy inside the organisation chart are
linked to the customer. Below is the illustration of the organisational chart.
PROFESSIONAL ENTERPRISE DEVELOPMENT GROUP ASSIGNMENT – STARBUCKS
14
Figure 1.2.1: A figure that illustrate how Starbucks treats its customer. (Brandautopsy.com, 2011)
Starbucks trains their partners to say “yes” to any requests made from their customer.
Barista always tries to remember the favour drink of a specific customer, they really try
to go beyond to make you really feel that you are an individual with a name labelled with
your preferred drink (businessholic.net, n.d). Furthermore, they make sure to keep
customer satisfied from the beginning till end of visit. This action would made a
consumer feel being treated as a friend instead of a customer drinking inside a coffee
shop.
Micah Solomon (2013) having a chat with an employee of Starbucks and the employee
claims that he had worked for a long time and thinks Starbucks takes care both customers
and employees equally. This shows that Starbucks not only focusing on customers
experiences but also taking care the welfare of their partners because Starbucks believes
when they are satisfied with the current job, they would possess a positive mindset
serving its customers.
According to 2012 Temkin Experience Ratings, Starbucks acquires the highest customer
experiences rating among the fast food industry, having the result of 80% overall
experiences (Figure 9). This proved that the current matrix structure has bring a positive
impact to Starbucks and bringing back its customer experience that once decreasing in
2008.
PROFESSIONAL ENTERPRISE DEVELOPMENT GROUP ASSIGNMENT – STARBUCKS
15
Figure 1.2.2: 2012 Temkin Experiences Ratings, Starbucks has the highest rating among all.(experiencematters.wordpress.com, 2012)
PROFESSIONAL ENTERPRISE DEVELOPMENT GROUP ASSIGNMENT – STARBUCKS
16
1.3 Limitations and Recommendation
In the matrix structure, there is some disadvantages. There is limitation of number of
employees who report to the project manager directly because most of the tasks are given
out from department managers. This may lead to uncertainty in the organisation and
employees may be unwilling to accept their situation is changing frequently.
Furthermore, the extension of authority of manager to employee coming from other
sections can cause complexity in the organisation. These issue would decrease the
motivation and passion of the employees, indirectly or directly affecting the quality of
customer serving experiences.
Starbucks uses matrix structure as organisation structure. Matrix structure brings
complexity and confusion to the organisation and employees. The recommendation for
Starbucks is train up their managerial staffs to be well-organised and having good
relationship between its partners to build up communication channel to avoid
misunderstanding and confusion due to multiples managerial staffs. A good leadership
must possessed in every managerial staff in order to lead their employees to achieve the
mission and goals in Starbucks, also boosting up motivation of the employees in order to
serve the customers better, increase overall customer experiences.
PROFESSIONAL ENTERPRISE DEVELOPMENT GROUP ASSIGNMENT – STARBUCKS
17
2.0 Organisational Culture
“The values and behaviors that contribute to the unique social and psychological
environment of an organization.” (BusinessDictionary.com, n.d.)
“Organizational Culture can be defined as the collective programming of the mind that
distinguishes the members of one organization from others.” (Geert-hofstede.com, n.d.)
Both of the statements above had defined the terms of “Organizational Culture”. Based
on the statements, organization culture can be explained as the common mindset among
members of an organization that used to react to various environments and
circumstances, and this will be distinct from other organization.
There are 4 types of organization culture based on the Competing Values Framework
(CVF), which are clan cultures, adhocracy culture, market culture and hierarchy culture.
All these 4 types can be distinguish from others, mainly by differentiate their focus area
and operational values.
Figure 2.0.1 Competing Values Framework
PROFESSIONAL ENTERPRISE DEVELOPMENT GROUP ASSIGNMENT – STARBUCKS
18
Clan Culture – Internal focus and values Flexibility
Adhocracy Culture – External focus and values Flexibility
Market Culture – External focus and values Stability and Control
Hierarchy Culture – Internal focus and values Stability and Control
a. Clan Culture
This type of culture commonly focused on employee perspectives and put employees’
involvement and job satisfaction at the first priority. It encourage employees to involve in
decision making which authority control in organization are less emphasized.
b. Adhocracy Culture
This culture are focus on market needs and customers perspectives. Organizations that
practice adhocracy culture are often encourage employee to think outside the box and
produce creative product to fulfill the market needs. Thus, innovations are often happen
in the organization.
c. Market Culture
This type of culture also focus more on the market needs and customers perspectives. The
organization values their employee based on their performance and results on the profit
statistics. The authority mainly emphasizes the productivity and profit gains, in order to
meet the market needs and customer satisfactions.
d. Hierarchy Culture
This culture puts employee satisfaction at the first place. It practices hierarchical
authority to provide control on the employees and often encourage employees to attend
training to improve employees’ skills. It prepare the organization to be more structured
and formalized.
PROFESSIONAL ENTERPRISE DEVELOPMENT GROUP ASSIGNMENT – STARBUCKS
19
2.1 Starbucks Organisational Culture and How It’s Affecting
Starbucks
“At Starbucks, we strive to create a culture that values and respect diversity and
inclusion.” (Starbucks.com, n.d.)
“When we are fully engaged, we connect with, laugh with and uplift the lives of our
customers.” (Starbucks.com.my, n.d.)
Based on the principles that found on Starbucks official website, Starbucks Corporation
can be believed that, they are practicing Adhocracy culture, which focus more on the
external environment and values flexibility over stability.
“It has always been, and will always be, about quality.” (Starbucks.com, n.d.)
This is the Starbucks principle on their coffee. They passionate on roasting best coffee in
various way, in order to fulfill the public needs that craving for a luxury pleasure.
Although coffee is the main selling product, Starbucks also understand that some
customers may dislike the taste of coffee or like to have some foods along with their
beverages. Due to this reason, Starbucks had introduced a series of brewed tea and juice
drinks, and also food like bakeries, savories, cakes and desserts, available in the menu for
customers to select.
Due to the consideration from Starbucks, the varieties of the menu and the high quality of
beverages and food had brought high altitude of customers’ satisfaction and gained a lot
of recognition in the market. Certainly, these are still reasons that aided the organization.
Since Howard Schultz (Starbucks chairman, president and chief executive officer)
purchased Starbucks in August 1987 (Starbucks.com, n.d.), Starbucks had put effort on
providing a comfort environment, which claimed to be the third place for customers
between work and home. Soon in year 1994, Starbucks opens its first drive-thru store
(Starbucks.com, n.d.), in order to bring further convenience for customers. All these
caring and efficient business tactics had aided Starbucks on leading the market.
“Partners”, is how Starbucks Corporation address their employees, regardless their
positions, origin or physical condition. Starbucks encourage all channel communication
PROFESSIONAL ENTERPRISE DEVELOPMENT GROUP ASSIGNMENT – STARBUCKS
20
among employees, which directly vitalize contribution of employees. Furthermore,
Starbucks encourage their customers to give ideas or opinions, and arrange employees to
improvise and implement the ideas. These promotes the communication between
employees and customers, or even strengthen the cultural values of the corporation.
Customer service is a significant part of Starbucks business. It show professionalism and
enthusiasm of the employees. When there is new employee joined the Starbucks
Corporation, the seniors will guide them on basics and then allow the new employee to
practically serve the customers. The culture pass on during the practical, based on the
guidance of senior employees, or even feedbacks from the frequent customers.
In Starbucks, customers are free to order their beverages according to their own desired
flavorings, and the employees are required to cooperate and brew the beverages
accordingly. The culture of Starbucks can easily pass onto new generations by
experiencing it and the influence of the environment.
Figure 2.1.1 Organizational Structure
Customer perspectives are always the main priority in the corporation. Starbucks believed
that every employees are responsible to serve every customers since it is a customer-first
business.
PROFESSIONAL ENTERPRISE DEVELOPMENT GROUP ASSIGNMENT – STARBUCKS
21
Figure 2.1.2 Command line of Ordering System
Figure 2.1.2 show how the customer service works in Starbucks Corporation. It involved
communication between customer, cashier and barista. The figure also shown that it
could be various way of ordering a drink. It is totally depends on customers’ desire and
employees are required to serve it right. This culture also represented how Starbucks
employees being flexible and independent on customers’ ordering and communications
between each other.
PROFESSIONAL ENTERPRISE DEVELOPMENT GROUP ASSIGNMENT – STARBUCKS
22
2.2 Limitation and Recommendation
Due to openness of Starbucks and creativity of employees, there is often so-called
“secret” menus leaked out and spread publicly. The menu is actually created by creative
employees and varies in every store. This had bring Starbucks an issue where some
customers might attend a store and order beverages that barista never brew before and
start complaining about the services of Starbucks. Hence, it would be recommended that
if one of the Starbucks store discover a new trend of beverage demand, the store should
share it with other stores so that standardization can be occurred.
PROFESSIONAL ENTERPRISE DEVELOPMENT GROUP ASSIGNMENT – STARBUCKS
23
3.0 Organisation socialisation and Mentoring
a. Organisation Socialisation
It is a simple process which helps a person to learn the values and norms so then a person
can participate in the organization. It also motivates a person to do his/her job and get
internally satisfied. There are three phases of organization socialization.
Anticipatory Socialization
Encounter
Change and acquisition
Anticipatory Socialization
When a person get interested in an organization, this phase helps a person in the
transition to an organisation or group the person does not belong.
Encounter
This is the phase helps when a person get accepted in to an organization, by the use of
onboarding programs which helps employees integrate and transition to new jobs by
making them understand organization policies, by making work responsibilities
understandable.
Change and Acquisition
This phase requires employees to master and understand their role in the organization
properly to proceed further. This is the last phase of organization socialization and only
happens when the employees fully understand their work role.
PROFESSIONAL ENTERPRISE DEVELOPMENT GROUP ASSIGNMENT – STARBUCKS
24
b. Mentoring
In simple words it is a relation between two people a Mentor and a junior person or new
recruit. It is a huge impact for organization in public and private sectors. This helps new
recruits to learn the way of doing a particular job in a particular field.
Mentoring benefits through organization
Benefits for the company:
Every company gains some benefits from mentoring such as
Improves employee retention.
Helps overcome learning curves.
Promotes highflyers.
Develops under-performers.
Benefits for the mentor:
There are benefits even for the mentor, such as learning something’s from their juniors
and teaching back what they learned from their mentors, every mentor was once
student/protégé before.
Benefits for the protégé/juniors:
They gets a lot of chances to learn from experienced people, meet different people across
organization. New opportunities in every way related to their particular field.
In Starbucks every employee has to go through a training process which comes under
mentoring. There are four types of training programs in this organization.
Barista basic training program
Shift supervisor training program
Retail management training program
District manager training program
PROFESSIONAL ENTERPRISE DEVELOPMENT GROUP ASSIGNMENT – STARBUCKS
25
The first and second training program has huge impact on customer service, where every
barista gets trained to serve their customers well.
The barista basic training program provides the basic training for new employees,
teaching skills and giving proper knowledge required for employee. This program teaches
them through one to one delivery showing how to attend a customer in proper Starbucks
barista way, which enhances confidence and capability in delivering a good customer
service.
PROFESSIONAL ENTERPRISE DEVELOPMENT GROUP ASSIGNMENT – STARBUCKS
26
3.1 Starbucks Organisation Socialisation and Mentoring
Starbucks organisation socialisation and mentoring is really important because there are a
lot of things comes under it such as customer service. Customer service play a wide role
in any organization specially Starbucks. Organization socialization and mentoring helps
in creating best baristas for their café’s all over the world. Because providing best and
friendly customer service is one of the most important goal of Starbucks, when the staff is
good their rating goes up. An organization need to have a good relation with their
customer for long term business. Having good relation with customers by providing good
customer services, these services can be anything from greeting to providing everything
possible to the customers. Starbucks creates amazing offers for their customers to keep
them happy in every way possible.
Organization socialization and mentoring is important in every organization, especially in
restaurants and café where the business is running as long as customers are happy. As in
the report it’s mentioned socializing and mentoring is really important for customer
service. With good mentoring, employees learn a lot of thing which helps them in
proving good service and because of that organization is running properly.
PROFESSIONAL ENTERPRISE DEVELOPMENT GROUP ASSIGNMENT – STARBUCKS
27
4.0 Professional Issue and Computer Ethics
a. Fair Employment Practices and Diversity
Starbucks committed to upholding a culture where diversity is valued and respected. So
it’s only natural that as a guiding principle, diversity is integral to everything they do.
The company wide diversity strategy focuses on four areas: partners, customers, suppliers
and communities: Partners is about the look and engage partners who are as diverse as
the communities that serve. Customers are that they extend the Starbucks Experience to
all customers, recognizing and responding to their unique preferences and needs. Their
aim to provide an exceptional customer experience by connecting with their customers in
a culturally relevant way. Communities support and invest in local neighbourhoods and
global communities through strategic partnerships and economic develop opportunities
that deepen our ties in the communities where we do business. Suppliers are the trustable
and welcoming company for suppliers. Starbucks is dedicated to creating a workplace
that values and respects people from diverse backgrounds, and enables its employees to
do their best work. They honour the unique combination of talents, experiences and
perspectives of each partner
b. Discrimination and Harassment
Starbucks promotes work surroundings where multiplicity is embraced and everywhere
our differences are appreciated and respected. Starbucks disallow discrimination and
harassment based on race, gender, gender identity and etc. Business Ethics and
Compliance is a program that supports Our Starbucks Mission and helps protect our
culture and our reputation by providing resources that help partners make ethical
decisions at work. The Standards of Business Conduct booklet is a resource distributed to
all partners to help them make appropriate decisions at work. The standards are a brief
statement of some of the company's expectations of how we are all to conduct Starbucks
business, consistent with our Mission and core values. This would train the partners to be
non-biased to every customer that visit Starbucks, providing them a biased-free
environment.
PROFESSIONAL ENTERPRISE DEVELOPMENT GROUP ASSIGNMENT – STARBUCKS
28
c. Privacy on the Web
Starbucks collects customer information from the website such as name, address, contact
number, email address, financial account information during Starbucks account
registration. They somehow disclose part of your information to limited third party
companies such as credit card company, affiliated company, website and blog that
collaborate with Starbucks you participate in and etc. Starbucks also ensure that the
information is secured inside the database and doesn’t share out to unauthorised third
party.
d. Encryption
Encryption is an expertise that allows protected transmittal of information next to the
Internet through encoding the transmit information through an arithmetical method that
scramble it. Without an equivalent "decoder," the broadcast would look like baloney text
and would be unusable. It able to be used with many applications, including electronic
commerce, email messages and responsive papers. Fundamental encryption involves the
broadcast of data from one party to another.
Starbucks released a new mobile app, but soon came under fire for vulnerability issues.
Starbucks wants to offer ease, all the details used to access the app, including the
password are stored on the phone. Unlike storing passwords on the computer when
asking a browser to remember the details, the information is stored in plain text. No
encryption service is used, making it possible for anyone to see the information. All a
person needs to do is connect the phone to the computer and download the information.
Email addresses, location and usernames used on the Starbucks app are also visible. A
hacker would not even need to unlock the phone to be able to get the information. The
danger is that hackers could gain access to a bank account to buy as many drinks as he or
she wants, as it is possible to allow the app to automatically fetch money from the bank
account when there are not enough funds stored within the Starbucks account. Linda
Mills, a spokesperson for Starbucks, admitted that there were vulnerability issues with the
app. The company is currently working on an upgrade to provide a fix for these security
problems that always face by user.
PROFESSIONAL ENTERPRISE DEVELOPMENT GROUP ASSIGNMENT – STARBUCKS
29
4.1 Recommendations
According to Stewart (2013), Starbucks mobile apps business drove 10% of the sales in
the US, so it would be recommended for further building to stream lining ease of use and
payment process which would help drive more customers, decrease wait time in stores
and increase efficiency. Integrating Starbucks loyalty program with the mobile
application would also be recommended. But before all of this changes, the encryption on
the mobile apps must be fix to avoid information leakage and misused by third party.
PROFESSIONAL ENTERPRISE DEVELOPMENT GROUP ASSIGNMENT – STARBUCKS
30
Overall Recommendation for Starbucks
According to all the research above, Starbucks obviously is having a good career
environment for employees that provide equals rights, right mentoring and guidance to
boost up their confident and motivation. From this view, it directly affect the quality of
customer services. In the matrix organisational structure, it stated that it would lead the
authority confusion, so the way to overcome this is maximising the communication
channel and the manager must possess a good leadership skills. Furthermore, its secret
recipe from Starbucks is limited due to geographical location since not every country
sharing the same ingredients and recipe, causing customer unable to get the favourite
drink anywhere they want. It is recommend to standardize all the ingredients worldwide.
Besides that, Starbucks having information vulnerability issue in their mobile apps,
causing anyone could take a look on their credential information. Starbucks should fix
this bug since 10% of its revenue in US came from mobile apps ordering.
PROFESSIONAL ENTERPRISE DEVELOPMENT GROUP ASSIGNMENT – STARBUCKS
31
Conclusion
From the overall report, Starbucks uses matrix structure as their organisational structure
after 2008 to maximise communication channel and pulling the relationship between
employee and customer together. Furthermore, Starbucks culture is adhocracy that focus
on external environment and values of flexibility over stability. Starbucks outlets having
the interior design that would make customer feeling relax while enjoying their beverage,
it has become part of community for people to gather and having a talk.
Besides that, Starbucks mentoring has given a full training programme to newcomer on
1-to-1 basic, this would ensure guidance and training is fully captured by the new
employees. Lastly, the ethical issue of Starbucks is their mobile apps having a great
security flaws causing credential information leakage.
PROFESSIONAL ENTERPRISE DEVELOPMENT GROUP ASSIGNMENT – STARBUCKS
32
References
1. Brandautopsy.com (2007). Solving Starbucks Problems: LOSS OF STORE SOUL
« Brand Autopsy. [Online]. Available from:
http://www.brandautopsy.com/2007/03/solving_starbuc_4.html [Accessed 13
May 2014]
2. Brandautopsy.com (2011). Radically Simplify Your Organizational Chart.
[Online]. Available from:
http://www.brandautopsy.com/2011/09/simplify_org_chart.html [Accessed: 5th
May 2014]
3. Bushman, M. (2007). Functional, Divisional and Matrix Organisational
Structures. [Online]. Available from: http://voices.yahoo.com/functional-
divisional-matrix-organizational-structures-165219.html?cat=3 [Accessed: 5 th
May 2014]
4. BusinessDictionary.com n.d. Organizational Culture. [Online]. Available from:
http://www.businessdictionary.com/definition/organizational-culture.html
[Accessed: 8th May 2014]
5. Businessholic.net n.d. The Inside of a Starbucks Company. [Online]. Available
from: http://www.businessholic.net/the-inside-of-a-starbucks-company/
[Accessed: 6th May 2014]
6. Dailycaller.com (2014). Use your phone to buy Starbucks? This MAJOR security
flaw could kill your buzz. [Online]. Available from:
http://dailycaller.com/2014/01/15/use-your-phone-to-buy-starbucks-this-major-
security-flaw-could-kill-your-buzz/ [Accessed 15 May 2014]
7. Frankel, A. (2007). Confessions of a Starbucks Barista. [Online]. Available from:
http://www.brownalumnimagazine.com/content/view/1462/40/ [Accessed: 5th
May 2014]
8. Friend, L. n.d. What is the Meaning of Organisational Structure?. [Online]
Available from: http://smallbusiness.chron.com/meaning-organizational-
structure-3803.html [Accessed: 4 th May 2014]
PROFESSIONAL ENTERPRISE DEVELOPMENT GROUP ASSIGNMENT – STARBUCKS
33
9. Galestafford.com n.d. Competing Values Framework Cameron Quinn. [Online].
Available from:
http://galestafford.com/wp-content/uploads/2013/02/Competing_Values_Framew
ork_Cameron_Quinn.gif [Accessed: 11st May 2014]
10. Gillikin, J. n.d. Advantages and Disadvantages of Divisional Organisational
Structure. [Online]. Available from: http://smallbusiness.chron.com/advantages-
disadvantages-divisional-organizational-structure-611.html [Accessed: 4 th May
2014]
11. Hitt, J. (2008). The Organisational Structure of Starbucks, Unilever, and Wal-
Mart. [Online]. Available from: http://voices.yahoo.com/the-organizational-
structure-starbucks-unilever-1495147.html?cat=3 [Accessed: 1st May 2014]
12. Hofstede, G. & Hofstede, G.J. & Minkov, M. (2010). Culture and Organizations:
Software of the Mind. 3rd edn. McGraw-Hill USA. New York.
13. Ingham A. (2014). Starbucks App Vulnerability Issues. [Online]. Available from:
http://guardianlv.com/2014/01/starbucks-app-vulnerability-issues/ [Accessed 14
May 2014]
14. Johnson, R. n.d. Advantages and Disvantages of Matrix Organisational
Structures in Business Organisations. [Online]. Available from:
http://smallbusiness.chron.com/advantages-disadvantages-matrix-organizational-
structures-business-organizations-26350.html [Accessed: 5th May 2014]
15. Kerner S.M. (2014). Starbucks, SSL for Twitter and Why Sensitive Data Must Be
Encrypted. [Online]. Available from: http://www.eweek.com/blogs/security-
watch/starbucks-ssl-for-twitter-and-why-sensitive-data-must-be-encrypted.html
[Accessed 13 May 2014]
16. Kokemuller, N. n.d. The Disadvantages of Clan Culture in Business. [Online].
Available from: http://yourbusiness.azcentral.com/disadvantages-clan-culture-
business-13376.html [Accessed: 9th May 2014]
PROFESSIONAL ENTERPRISE DEVELOPMENT GROUP ASSIGNMENT – STARBUCKS
34
17. Maggie (2014). Starbucks: Obscenly Expensive Coffee Joint’s App Doesn’t
Encrypt Your Data. [Online]. Available from:
http://www.maggiesnotebook.com/2014/01/starbucks-obscenly-expensive-coffee-
joints-app-doesnt-encrypt-your-data/ [Accessed 14 May 2014]
18. Maire, T.M. (2010). Starbucks Organisational Mission and Strategies. [Online].
Available from: http://voices.yahoo.com/starbucks-organizational-mission-
strategies-5707838.html?cat=55 [Accessed: 11 st May 2014]
19. Melody (2012). Debunking the myth of the Starbucks secret menu. [Online].
Available from: http://www.starbucksmelody.com/2012/04/27/debunking-the-
myth-of-the-starbucks-secret-menu/ [Accessed: 10th May 2014]
20. Montana, P. & Charnov, B. (1993) Chapter 11: Organisational Structures:
Concepts and Formats, in Management: A Streamlined Course for Students and
Business People, Barron’s Business Review Series, Hauppauge, New York, pg
156-157.
21. Mystarbucksidea.force.com n.d. My Starbucks Idea. [Online]. Available from:
http://mystarbucksidea.force.com/ [Accessed: 6th May 2014]
22. Owens, C. et al. n.d. Organisational Design and Change at Starbucks. pg 9-11.
23. Pixelkated.com n.d. Command Line. [Online]. Available from:
http://www.pixelkated.com/wp-content/uploads/2010/01/starbucks_commandline
_enlarged.gif [Accessed: 7th May 2014]
24. PM Hut. (2009). Organisation Structures in Project Management. [Online].
Available from: http://www.pmhut.com/organization-structures-in-project-
management [Accessed: 5 th May 2014]
25. Richstein, R. (2013). At Starbucks, the key innovation was its company culture.
[Online]. Available from: http://richgoldstein.com/2013/05/09/at-starbucks-the-
key-innovation-was-its-company-culture/ [Accessed: 5th May 2014]
26. Sample_Chapter n.d. Organizational Culture, Socialization, and Mentoring.
[Online]. Available from:
http://highered.mcgraw-hill.com/sites/dl/free/0078137209/929877/Sample_Chapt
er.pdf [Accessed: 5th May 2014]
PROFESSIONAL ENTERPRISE DEVELOPMENT GROUP ASSIGNMENT – STARBUCKS
35
27. Schreiner, E. n.d. Starbucks and Its Organisational Design. [Online]. Available
from: http://smallbusiness.chron.com/starbucks-its-organizational-design-
12857.html [Accessed: 1st May 2014]
28. Schultz, H. (2009). Howard Schultz’s memo to Starbucks employees. [Online].
Available from:
http://seattletimes.com/html/businesstechnology/2004194019_webhowardmemo2
1.html [Accessed: 7 th May 2014]
29. Seazone (2009). Successful Application of Organisational Behavior: Starbucks.
[Online]. Available from: http://voices.yahoo.com/successful-application-
organizational-behavior-2435551.html?cat=3 [Accessed: 7 th May 2014]
30. SeaZone (2009). Successful Application of Organizational Behavior: Starbucks.
[Online] Available from: http://voices.yahoo.com/successful-application-
organizational-behavior-2435551.html?cat=3 [Accessed: 5th May 2014]
31. Smith, D.P. (2011). Over the Hill: 40 Years of SBUX. [Online]. Available from:
http://www.qsrmagazine.com/executive-insights/over-hill-40-years-sbux
[Accessed: 10th May 2014]
32. Spinelli, F. (2012). What’s Your Corporate Culture?. [Online]. Available from:
https://smucoxexeced.wordpress.com/2012/05/14/whats-your-corporate-culture/
[Accessed: 8th May 2014]
33. Starbucks n.d. Starbucks Company Recognition. [Online]. Available from:
http://www.starbucks.com/about-us/company-information [Accessed: 5th May
2014]
34. Starbucks n.d. Starbucks Company Timeline. [Online]. Available from:
http://www.starbucks.com/about-us/company-information [Accessed: 5th May
2014]
35. Starbucks.com n.d. Our Heritage. [Online]. Available from:
http://www.starbucks.com/about-us/our-heritage [Accessed: 8th May 2014]
36. Starbucks.com.my (2014). Company Information. [Online]. Available from:
http://www.starbucks.com.my/about-us/our-company [Accessed 14 May 2014]
37. Starbucks.com.my n.d. Our Company. [Online]. Available from:
http://www.starbucks.com.my/about-us/our-company [Accessed: 6th May 2014]
PROFESSIONAL ENTERPRISE DEVELOPMENT GROUP ASSIGNMENT – STARBUCKS
36
38. Starbucks.com.my n.d. Our Starbucks Mission Statement. [Online]. Available
from: http://www.starbucks.com.my/about-us/our-company/mission-statement
[Accessed: 6th May 2014]
39. Starbucks.com.my n.d. Privacy Statement. [Online]. Available from:
http://www.starbucks.com.my/about-us/our-company/online-policies/privacy-
statement [Accessed: 15 th May 2014]
40. Starbuckswithanextrashotofhistory.com n.d. Starbucks Timeline. [Online].
Available from: http://www.starbuckswithanextrashotofhistory.com/timeline.html
[Accessed: 6th May 2014]
41. Stewart, J. (2013). Personal Media Weekly: May 7,2013. [Online]. Available
from: http://www.tigerspike.com/news/2013/05/07/personal-media-weekly-may-
7-2013/ [Accessed: 15 th May 2014]
42. Tutorialspoint.com n.d. Organisational Structures. [Online]. Available from:
http://www.tutorialspoint.com/management_concepts/organizational_structures.ht
m [Accessed: 4th May 2014]
43. Ukessays.com n.d. Issues and challenges faced by Starbucks Corporation.
[Online]. Available from: http://www.ukessays.com/essays/marketing/issues-and-
challenges-faced-by-starbucks-corporation-marketing-essay.php [Accessed: 10th
May 2014]
44. Ukessays.com n.d. Issues and challenges faced by Starbucks corporation.
[Online]. Available from: http://www.ukessays.com/essays/marketing/issues-and-
challenges-faced-by-starbucks-corporation-marketing-essay.php [Accessed: 10 th
May 2014]
45. Writing, A. n,d. Different Types of Organisational Structure. [Online]. Available
from: http://smallbusiness.chron.com/different-types-organizational-structure-
723.html [Accessed: 4 th May 2014]
PROFESSIONAL ENTERPRISE DEVELOPMENT GROUP ASSIGNMENT – STARBUCKS