du MINICASE 4 Starbucks: Re-creating Its Uniqueness INSPIRED BY ITALIAN coffee b
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du MINICASE 4 Starbucks: Re-creating Its Uniqueness INSPIRED BY ITALIAN coffee bars, Starbucks's Coming out of an eight-year retirement, Howard CBO Howard Schultz set out to provide a completely Schultz again took the reins as CEO and president in new consumer experience. The trade- mark of any Starbucks coffeehouse is its ambience-where music and comfort- able chairs and sofas encourage custom- ers to sit and enjoy their coffee beverages. u YW might further dilute the brand. In the fall While hanging out at Starbucks, they can use the complimentary wireless hotspot or just visit with friends. The barista seems to speak a foreign language as she rattles off the offerings: Caffé Misto, Caramel Macchiato, Cinnamon Dolce Latte, Espresso Con Panna, or a Mint Mocha Chip Frappuccino, among some January 2008, attempting to re-create what had made Starbucks special. In late 2009, Starbucks introduced Via, its new instant coffee, a move that some worried of 2010, Schultz rolled out a new guide- line: Baristas would no longer multitask making multiple drinks at the same time, but would instead focus on no more than two drinks at a time, starting a second one while finishing the first. The goal was to bring back the customer experi- ence that built the Starbucks brand. 30 different coffee blends. Dazzled and enchanted, customers pay $4 or more for a Venti-sized drink Starbucks has been so successful in creating its Review Chapter : Intemal Analysis: Resources, ambience that customers keep coming back for more. Capabilities, and Activities DISCUSSION QUESTIONS Starbucks' s core competency was to create a unique . How did Starbucks create its uniqueness in the first consumer experience the world over. That is what cus- tomers are paying for, not for the cup of coffee or tea The consumer experience that Starbucks created was a valuable, rare, and costly-to-imitate intangible resource This allowed Starbucks to gain a competitive advantage. place? 2 Was Starbucks's uniqueness a VRIO resource? Did it help Starbucks gain and sustain a competi- tive advantnge? Why or why not? Why and how did Starbucks lose its uniqueness? 3. While intangible resources are often built through learning from experience, intangible resources can 4. How is Starbucks attempting to re-create its atrophy through forgetting. This is what happened to Starbucks. Recently, Starbucks expanded operations by opening over 16,000 stores in some 50 countries.5 Explain Starbucks's ups and downs using (a) stra- It also branched out into desserts, sandwiches, books music, and other retail merchandise, straying from its core business. Trying to keep up with its explosive 6 growth in both the number of stores and product offer ings, Starbucks began to forget what made it unique uniqueness? Do you think it will be successful? Why or why not? tegic activity systems and (b) the dynamic capabil- ities perspective. What implications can you draw? What recommendations would you give Howard Schultz? Support your arguments that made it special, and its unique Endnotes culture got diluted. For example, baristas used to 1. This Min Case is based on: Schultz, H., and D. I. Yang grind beans throughout the day whenever a new pot of coffee had to be brewed (which was at least every Company One Cup at a Time (New York: Hyperion); Behar, H eight minutes). The grinding sounds and fresh coffee (2007), It's Not About the Coffee: Leadership Principles from aroma were trademarks of Starbucks stores. Instead, to a Life at Starbucks (New York: Portfolio;: "Latest Starbucks accommodate its fast growth, many baristas began to buzzword: "Lean Japanese techniques" The Wall Street grind all of the day's coffee beans in the morning and store them for the rest of the day (1999), Pour Your Heart Into It: How Starbucks Buit a Journal, August 4, 2009; and "At Starbucks, baristas told no more than two drinks." The Wall Street Journal, October 13, 371Explanation / Answer
1. • Starbucks needed to make a remarkable ordeal for their clients by making an environment that was welcoming where clients can unwind and make the most of their espresso refreshments, music, and the complimentary wifi, or simply hang out with companions.
2. • If Yes, as expressed for the situation Starbucks made a one of a kind client encounter that was significant, uncommon, and expensive to-mirror enabling Starbucks to pick up an upper hand yet was not ready to maintain that preferred standpoint for the long run.
• If No, understudies can contend that shoppers can buy espresso from another contender and for less expensive since espresso and tea are not uncommon. In any case, the case plainly expressed that Starbucks made a client encounter that was significant uncommon, and expensive to-mimic elusive assets
3. • Starbucks was not ready to manage that upper hand and lost its uniqueness when it started fast extension, stretched out into other stock, strayed from its center business and weakened its interesting society.
4. • Starbucks is endeavouring to re-make its uniqueness by bringing back the client encounter by moving to a more client arranged core interest. Baristas will make close to two beverages at any given moment, rather than performing various tasks baristas and making different beverages at once.
• If truly, this endeavour might be fruitful on the grounds that it takes the concentration back to the client, rather than being only any customary client, every client will now have that exceptional sentiment of being essential once more.
• If no, this endeavour probably won't be as effective, in light of the fact that it might back off the procedure, and clients may need to sit tight longer for their beverages or the experience does not have a similar effect now it completed ten years prior.
5. a) From a key action frameworks point of view, Starbucks was quickly extended their activities and spread out into numerous other retail stocks. The fast development and items offered hinted at Starbucks to overlook its special culture and center business. It lost spotlight on the center exercises.
b) From a dynamic abilities point of view, Starbucks strayed from its center business by venturing into an excessive number of various kinds of stocks and appeared to neglect that heart of Starbucks depended on its clients experience and espresso. Thus, Starbucks is endeavouring to bring back the client encounter by decreasing the baristas' assignment to center around a couple of duties. Likewise, and focus back on espresso, Starbuck is concentrating essentially on espresso again rather than different items, by presenting their moment espresso, VIA.
• The suggestions drawn from the case is to recall forget the organization's center business esteems and objectives, and to endeavour to actualize techniques which would improve these qualities
6. • Some suggestions for Howard Schultz might be to lessen a portion of their product offerings so they can refocus on espresso and tea, and additionally come back to crushing espresso for the duration of the day with the goal that each time a client strolls through the entryways, there is a steady smell of crisp espresso.
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