Starbucks Corporation: Competing in a Global Market Essay Example

the globe today are going for international markets in dealing with their customers and thus they are competing with each other in the global markets.

By going global, the corporations are not only selling their products and services to one continent, but they are spreading their territories and going to other continents around the globe (Hitt et al. , 2009). Mission Starbuck coffee company has a mission of serving its customers with high standards and quality. The company was founded with an intention of serving its customers and wholesalers with the best kind of quality and services at all times without lowering their standards at any one point. The mission statement of Starbuck states, “establish Starbucks as the premier purveyor f the finest coffee in the world while maintaining our uncompromising principles while we grow. ” For any mission statement to work in a given company, it has to be meaningful hence will motivate people. Leaders of organizations competing in the global markets need to give their employees a high sense, inspire them, and make it possible for them to be proud of the work they have been assigned to do (Griffin, 2006). Vision The future of Starbucks is to be able to reach a large population globally and still maintain their quality.

The company is also intending to supply its products and services to other continents at a price that is affordable and reasonable. The company aims at opening up other branches in the globe and by so doing will encourage other organizations to focus on the external markets, which are also in need of the products being produced by companies found

in developed countries. For example, the vision for hotels in Saudi Arabia is to expand to other continents in the world and interact with other corporations hence building and strengthening ties for future guidance and associations, which will build strong ties.

In Saudi Arabia, Zain states its vision as, “Zain will become a global wireless operator by 2011 through a 3x3x3 profitable expansion plan. ” The group and CEO of the company aspire to increase their clientele base in stages of its operations and intend to expand its activities thus, want to lead its group into becoming a leading mobile company of communications. Values The corporation is committed to see to it that the work environment is great consequently, encourage the workers to treat each other with dignity and respect at all times.

By so doing, the employees are motivated and will exchange ideas and suggestions with top management, which boosts their self-esteem levels. The company on the other hand, has been able to embrace diversity, which is an essential component in conducting business transactions at any company. Diversity in the workplace will enable the workforce work willingly and freely with the managers hence will see to it that they put the interest s of the company first as it will eventually spill down to their hard work and achievements.

The vision of Zain in Saudi Arabia is powered by the people and thus, at the forefront of planning, execution, and management, the people’s interests are put first for the company to achieve its success. The company wants to enchant the customers and exceed their expectations in order to attain its major

goals. Zain takes pride in its foundation, its employees, and in the manner in which they operate hence, the values are: radiance, belonging, and heart. By being radiant, the company wants a leader that is going to lead the group with imagination and vision, bringing color, joy, and richness to the business environment.

The heart value represents living lives that are filled with courage and resolutions, touching people’s emotions and engaging their spirits. Belonging on the other hand means being part of the community spirit and having fellowship with each other and knowing no existing territorial boundaries. Major goals The major goal of Starbucks is to maintain their customers and apply their high standards of excellence with regard to purchasing, roasting, and fresh delivery of the coffee products with no delays. The corporation also wants to develop a culture that ardently leaves their customers satisfied at all times without having complaints.

The other goal associated with Starbuck is to see to it that their Corporation contributes to the development of the community and environment positively by providing employment to the qualified and unqualified members of the community who will in turn facilitate groups that will see to the generation of groups and programs that will help the community grow. The corporation recognizes the fact that for any organization to grow, profits need to be ploughed back since it will help in the settlement of future problems that may arise.

Zain’s vision will enable it grow and go beyond mobile, telecommunications, international, and growth in the Middle East and thus wants to become a global leader. Concerning going beyond mobile, it wants to

become the leader who will provide innovative and enjoy wireless services covering all the needs of their customers. Zain wants to build a solid ground of entertainment that will position it beyond pure services of telecommunications hence achieving their vision of going beyond other telecommunication sectors and international grounds.

For the Company to go beyond growth, it will need to ensure that its expansion does combine with profitable growth and synergies drivers that promote their creation value. SWOT Analysis The analysis made on Starbuck SWOT examines the corporation’s key structure and operations of the business, products, and history, and a summary of the analysis key revenue structures and strategies being employed. This profile will give information pertaining to the corporation’s data and information, which helps the top-level companies and leaders in managing and running their businesses into the global markets that are very competitive.

Many are the times when protests have been targeted by many people with regard to Starbucks policies of fair trade, labor relations, the environmental impacts, politicians view, and practices of the anti-competitive (Kinicki & Williams, 2002). Strengths As an organization, the corporation is very profitable and at some point in time the organization in the same year, generated revenue that summed up to $5000 million. The reputation it has bestowed upon its organization is one that has been recognized globally as an organization that produces the finest products and services to all its customers and market in almost all the countries.

In respect to its workforce, the corporation has been regarded as one of the Top 100 Fortune Companies since it values and respects their employer, which has

contributed greatly to its growth and expansion in the global markets. The Corporation has a wide range of product diversification, which has contributed greatly in the increase of their global markets competitors, and thus they have been able to establish a logo, a brand that is continuously developing, trademarks, copyrights, patents, and websites of the whole company.

The locations of the specialty stores in different continents have a high visibility, which has attracted more and more customers hence increasing the revenues of the company (Kreitner, 2006). It also has high ethical values and ethical statements of the mission, which is, “'Starbucks is committed to a role of environmental leadership in all facets of our business. ” Weaknesses The company’s level of creativity and development of new products is too high thus giving it a good reputation in the global market, but the problem that arises is their vulnerable state of innovation, which at some point will lead to their falter.

The company depends mainly on their main competitive advantage, which is the retail coffee dealers and hence has made them slow in relation to their diversity levels into other sectors of the economy should the need to do so arise. This is a weakness to their corporation since they will not be able to expand quickly and reach a large target market in the competing global markets ion our current markets. They have focused more on their expansion rates without putting into consideration their internal focus, which is critical in order for them to take on the global competing markets.

As the markets grow, so does the number of competitors and thus

they need to be ready at all times so as to counterattack the moves made by their competitors who have the intention of persuading their customers. The aspect of cross-functional management is also a weakness to their corporation, which is in the competing global markets. The products produced by Starbuck Corporation have high pricing values which has made it impossible for all consumers to appreciate the high quality products and services offered by this company. Self-cannibalization is also a weakness experienced by the Corporation.

Opportunities Starbuck utilizes the opportunities that present themselves maximally to their advantage, which has given them an added advantage to their competitors in the global markets. For example, in 2004, the company was able to give its customers the chance of making their own music CD in the USA. This opportunity gave them a competitive advantage in the global markets since it was able to attract more customers to their shops and retail outlets. In addition, the customers were young, vibrant and needed the products and services of Starbuck Corporation.

They were also able to introduce new products and services to their retail stores especially the cafes where they gave their customers Fair Trade. The company has also an opportunity of expanding its operations globally to those companies not yet reached. For example, the Pacific Rim and India are some of the nations that have emerged. The other potential associated with this corporation is the fact that they can co-brand their products with other food and drink manufacturers hence will be granted the license of franchising their brands to other goods manufacturers.

The global markets have also adopted

new technologies which has given the company an opportunity to use them and improve their quality and standards of products and services especially in the global markets. Starbuck has also discovered new methods of delivering their products and services to customers in the global market arena. V Developers in Saudi Arabia is a software company that deals with information technology and has been able to expand its territories to the global markets since it has developed new delivery strategies (Kreitner, 2006).

Threats The one threat is the fact that the company is not sure whether or not coffee markets will continue to grow or whether a new brand of product (beverage) will come and replace it in the near future. Not knowing the fate of the product is a big threat to the company since they are not certain whether if they invest in the product they will get their returns. Most of the dairy products and coffee products are bound to increase in cost, which is a threat to the Corporation since their profit margins will reduce drastically.

This kind of exposure will make them loose customers hence reducing their market niche. Many of the upcoming companies dealing with similar products as Starbucks have opted to imitate them, which are a threat to them since they produce brands that are of poor quality and low standards. In developing countries, the vitality of coffee prices has led to their collapse. To the farmers, the who are being treated unfairly by most of their buyers has given the Corporation negative publicity which has made customers not trust the legibility of the business deals conducted

by the organization.

For foreign countries, the most threatening issue that arises is the political and cultural issues that take prevalence in the territory and are being neglected by the organization. For example, hotels in Saudi Arabia that have gone into global markets have decided to maintain their cultures which is not appreciated by most people in the foreign countries and thus are not visited by majority of the citizens of that country for not regarding the fact that they are in somebody else’s territory.

The younger, domestic segments of the markets have also been alienated which is not good since they serve a purpose in the global market at some point in time (Kinicki & Williams, 2002). Strategy Implementation Starbuck has employed the Porter’s Differentiation Focus Strategy that provides to a specific market niche a product or service and has been able to differentiate from those competing in specific areas. This Corporation is of a high cost, has a specialized provider selection, the coffee and tea roducts being offered are of a specialized tailored line to the lovers of coffee at a premium price. Its utilization of this strategy has enabled the organization embrace the position it holds in the global market as a leader of product quality and has leaders who are industry segmented. Starbuck approaches its competitors in a humble way and avoids promoting its products; this strategy has been achieved through giving support to its customers and through its good works. For any mission statement to work in a given company, it has to be meaningful hence motivate people.

Leaders of organizations competing in the global markets need

to give their employees a high sense of motivation and inspire them. This has made it possible for them to be proud of the work they have been assigned to do by their managers and leaders in different departments, which contribute to the growth and expansion of the company (Werther & Chandler, 2006). Strategic Decision Making The business strategy employed by Starbuck Corporation is similar to that of the corporate strategy level because the organization is a single business company that deals merely on retail stores and products related to coffee.

Starbuck lives by a slow policy growth where it first dominates the market before it decides to set its sights abroad into the international market. This strategy has made the leaders use the bottom-up process (Pennings, 1986) in its decision making process bearing in mind that the managers put into consideration their workforce and thus they give them a chance to make suggestions and give ideas that will help the organization to grow (Malhotra & Peterson, 2006).

Strategic Leadership Strategic leadership in Starbucks Corporation has been able to set high expectations and standards for all those who want to become global leaders in competing markets. All the time, these leaders are being watched by the entire globe and thus, they should have good leadership strategies and skills that are admired by many in the business environment (Hitt, 2009).

Starbuck leaders are keen not to violate the company’s values since they are the ones that stir the company to achieving their goals and objectives, which affect the employees and community at large. Starbuck leaders are role models to their workforce and other

people they meet. Leaders who employ strategic techniques need to be dedicated to what they say since this shows the devotion of the leader to achieving the mission and vision of the organization (Dess et al. , 2006).

Leaders in Starbuck Corporation have a personality that has had a huge impact on the performance on its team, which has had remarkable difference on the organization. Managers who happen to visit the stores would not hesitate to put on an apron and join the workers when something needs to be handled. The manager does not mind the expensive suit he/she has on, but acts symbolically to show the employees that they need to be united at all times in order to achieve their best (Hill & Gareth, 2007).

Conclusion Starbucks wants to become the next Coca-Cola of the coffee specialty segment and is the only company that has managed to be getting close to the national marketing coverage. The company’s immediate objective was to have operational stores as well as be recognized and respected coffee brand in the world. The owner is very innovative and wants to use the joint ventures by increasing the strategic interest’s spheres, which will reinvent the way the corporation is handling its business.

This has been helpful since they have been able to sell their products and services to supermarkets, which has promoted the products and thus has increased their levels of competing in the global markets (Dunne, 2007). Recommendation This corporation should be able to sustain its growth and make the business have a stronger global brand. In therefore needs to challenge the company’s status quo, be

more innovative, be able to take risks and alter its vision of how it operated its business, who it was, and where it intends to head in the near future.

The owner guides its management team into strategic putting into consideration certain questions that arise and need to be realized with immediate effect to maintain its competitive advantage in the global markets. Starbuck should also consider implementing another marketing strategy other than the use of alliances especially since it does not rely on reputation, awareness of the brand, and word or mouth promotions. It should also broaden its focus from the simple high-end pricing and provide a package that is economic especially during the tough times (Werther & Chandler, 2006).