Starbucks' Organizational Culture Essay Sample


Millions of people walk into a Starbucks coffee outlet every day for their favorite cup of the drink. Starbucks is an American Corporation that was started in 1971, in Seattle, Washington. The company is a premier roaster, marketer and retailer of specialty coffee and snacks around the world (Simon, 2009). The business has been growing steadily since its establishment, and, at present, it dominates the industry with a 36.7% market share, while the rest of it is occupied by other brands such as McDonald’s, Costa Coffee and Tim Horton’s (Simon, 2009). Nevertheless, Starbucks’ success has not been easy to come by; it has taken a strong organizational culture and management.

The Elements of the Company’s Corporate Culture that Have Contributed to Its Success

According to Barney (1986), a corporate culture is a set of shared, taken for granted assumptions that a business holds, and it determines how the company perceives, thinks about, and reacts to various environments. Speaking about the corporation under consideration, there are a number of key elements in its organizational structure that have contributed to its success. One of them is the treatment of employees with dignity and respect that has led to Starbucks continued growth. Its business model is conceptualized through a humanistic approach which ensures that the management create a good working relationship with the workers. Furthermore, healthy relations are also built between staff members, clients and other stakeholders. Human skills are the management’s ability to work with and through other people and to perform effectively as a group member (Daft, 2012). Without strong working relationships, the employees being the face of the company would not be able to deliver to the clients, efficiently and with utmost care.

To continue, Starbucks exceptional treatment of workers would not be successful without effective communication. The corporation maintains open communication channels with customers, employees and other stakeholders. The mentioned strategy has made a name for the business making it known as being a transparent company in its operations, and has also worked to curb rumors. Information on the organization and its activities is available even on its website. Furthermore, they make press releases whenever necessary. All these measures have led to the increase in public confidence in it, hence maintaining good reputation. Moreover, they ensure the customer retention remains high, and the number of return customers is rising (Simon, 2009).

Community involvement is another major element of Starbucks’ corporate culture that ensures its permanent growth. The corporation takes part in public initiatives and works to make sure that the communities that they work in become better. The company has partnerships with organizations such as American Red Cross, Culvert Foundation, and Save the Child among others through which Starbucks makes a positive difference in the places that they operate in, thus increasing trust to and support of their brand.

In addition, heritage and culture is another factor that has made it possible for Starbucks to thrive despite the ever-present competition. The organization has held on to its original principles and values that are making the best coffee and making the world better. The consistency of their products has made the business successful, and the customers have no doubts about their quality which has increased the level of their retention (Flamholtz & Randle, 2011). Coffee served in all Starbucks outlets’ tastes the same, be it in Asia, America or Europe. The quality of service also remains excellent despite the geographical and cultural differences in countries where they operate.

Starbucks corporate culture also includes diversity and inclusion that have greatly promoted its global success (Flamholtz & Randle, 2011). In the company, both workers and clients are treated with utmost respect and fairness despite their color, religion, race and gender Starbucks employs a multi-ethnic team with the aim to ensure there is an improvement in cultural competencies and diverse supplier network.

Lastly, environmental awareness is also a fundamental element of Starbucks corporate culture. Over the years, the company has won several accolades for their efforts to conserve the environment. It is ranked third on the EPA’s National Top 20 Retailers list of largest green power buyers, and fourth on the National Top 50 and Fortune 500 lists (“Company Fact Sheet,” 2008). Starbucks has initiatives to ensure most of their waste products can be recycled, their water wastage is minimized, and their buildings have the lowest possible negative impact on the surroundings.

The Management of the Corporation

The Management Decisions

Starbucks management has made several innovative decisions over time, most of which have made its operations very successful. The company’s original goal was to set up a coffee house with a friendly atmosphere where customers enjoy their coffee and, at the same time, socialize with other people (Simon, 2009). This concept has materialized with recent developments in technology. Bearing in mind that individuals are starting to value their time more, every Starbucks outlet offers Wi-Fi connectivity. This is a convenience for the consumers that aims to save their time. Moreover, with the introduction of Smartphones, the management introduced an application that enables one to locate the nearest store that makes it easy for clients to find a place without hassle and time wastage. The application can also be utilized to claim for rewards and gifts. It is worth stating that the free Wi-Fi and the application are present on all the territories where Starbucks operates.

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Interestingly, the corporation never spends money on television advertisements. Instead, it relies heavily on word of mouth promotion which has provided the company with a strong customer base and brand identity through its effective and innovative offerings. Clients can enter a Starbucks outlet and socialize with others, either on the World Wide Web or through Smartphone applications. Whenever a person is having coffee at Starbucks, and they have free Wi-Fi, it is most probable that they will update on their social network page their location attracting more visitors to store.

The Key Management Competency

One key management competency that a successful manager at Starbucks needs is human skills that can be perceived as a set of social, interpersonal and leadership competencies (Barney, 1986). They are especially important when working in a guest serving field. For a manager to be successful when working for the corporation, he or she must be able to lead the employees and serve as an example for them. At the same time, the person must be the one that can address client complaints effectively. Moreover, being able to work with junior workers is a must so that they can reflect the same in their service delivery. Lastly, a successful manager must be able to interact with customers freely, and in a friendly way so as to retain the brand’s reputation and for them to return.

The Current CEO of the Corporation

Howard Shultz, Starbucks CEO has been the driving force behind Starbucks organizational culture and overall success. Before the period of his directorship, the corporation had only ten outlets. However, with his vision and strong leadership and administrative skills, he managed to turn around the company to global success. Howard’s vision was to make Starbucks the premier purveyor of the finest coffee in the world while maintaining uncompromising principles as the business grows (Company Factsheet, 2008).

Howard has made risky decisions and transformed the way that Americans perceive coffee. He pioneered the first American coffee house with an atmosphere that is more attractive to the American people compared to other coffee places. He has also made the company more attractive to different demographic groups. Thus, without his keen leadership and management decisions, the organization would not have universal acclaim.

It seems that without his leadership, the company’s future could be fragile. However, this risk can be mitigated by ensuring that new CEO embraces Howard’s vision and mission, and the organizational culture is adhered to strictly.

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In conclusion, an organization’s corporate culture is of vital importance to its continued growth, development, and sustainability. Starbucks has managed to remain competitive and profitable because of a strong corporate culture. First of all, the corporation has always treated its employees and customers with respect and dignity and has been conscious of the environment. Moreover, it has ensured that it communicates regularly, gets involved into the local communities activities and ensures there is inclusion and diversity in its operations. All these elements of corporate culture have led to the fact that Starbucks thrives. The senior management of an organization should take lead in enforcing the corporate culture, just as its present CEO Howard Schulz.

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