Starbucks Operations Management Report
OVERVIEW Starbucks operates globally serving millions of customers on a daily basis. The company operates internationally with more than 30,000 retail stores in 80 countries1. Its global operations depend on the service provided through a number of international partners, and in particular a worldwide network of franchises and licensed Starbucks cafes. This allows for local responsiveness through a degree of decentralised decision-making, while providing the advantage of operational efficiencies by leveraging global standards and core competencies.
This assessment is based on the operations of Starbucks and requires you to consider both global and local aspects of its operations. Your submission is in the form of a report in two parts, A and B.
PART A (Max. 1500 words, 40 Marks)
Using Starbucks as the main case, and drawing on information within the public domain and your own observations, complete a:
(1) Four Vs analysis,
(2) Performance Objectives Analysis and
(3) Design Analysis
comparing the operations of Starbucks to that of Greggs2, the largest bakery chain in the United Kingdom. You will recall from lecture and seminar activities, that the true power of these analysis lies in comparative analysis. In completing the analyses (1)-(3), you may draw on information obtained through direct observation, or within the public domain. As a point of convenience, both companies have operations within close proximity of the BPP University Shepherds Bush campus. Starbucks has a licensed store located at 62 Uxbridge Road, Shepherds Bush, London, ENG W12 8LP, while Greggs is located a few feet away at 68 Uxbridge Rd, Shepherd’s Bush, London W12 8LP (See Figure 1).
Important: while you are encouraged to visit the stores above to observe the operations in person, you should not question or interview staff. Information gained from your own observations, and available in the public domain are sufficient to complete the assessment.
Hint: In this part of the assessment you will have to agree your unit of analysis, for example, global or specific store level.
Part A of the report should have the following sections. For each section a general word guide is provided and the maximum marks available. A further breakdown of these marks can be found in Section 3, under the marking guide.
Comparative Four Vs Analysis (Approx. 525 words, 14 Marks) Carry out a four Vs comparison of Starbucks and Greggs. In doing so, create a Four Vs profile of both operations, and briefly explain each aspect of the two profiles. Explain why you think the profiles look the way they do, and the differences (if any) between the profiles of the two operations. In doing so, remember to justify and where possible evidence all arguments put forward.
Comparative Performance Objectives Analysis (Approx. 600 words, 16 Marks) Compare the current operations performance of Starbucks café operations to those of Greggs. Map on a polar diagram the current performance of both operations. You must explain what the various operations performance objectives mean, and justify based on the use of evidence, your comparisons. Your discussion should consider whether the markets for Starbucks and Greggs are different, and to what extent this affects the importance of each operations objectives.
Design analysis (Approx. 375 words, 10 Marks) On the basis of the previous analysis, how have the Four-Vs and Performance Profile of the two operations influenced (1) the design of the customer service process, and (2) store layout, at a typical store? I say typical, because both Starbucks and Greggs have multiple store locations. In your response, explain how process and layout design decisions allow the operation to cope with core operations characteristics (Four Vs), and how these design decisions are affected by performance and performance trade-offs. PART B (Max. 2000 words, 60 Marks)
Using the case of Starbucks as well as a minimum of eight (8) published journal articles, and secondary sources such as company reports, produce PART B of the report. This part of the report requires you to critically discuss the role of ONE of the following five key areas of operations management in the success of Starbucks:
Supply chain management
Insourcing and outsourcing
Planning and control
As a detailed guide to this part of the report, you must consider in one way or another, the following:
1. Overview (Approx. 150 words, 5 Marks).
Introduce the operational area and its scope within the operations of Starbucks. For example, if you choose, “Supply chain management”, discuss to what extent the operations of Starbuck are shaped and influenced by management of its supply chain, and its contribution to organisational performance.
2. Starbucks global operations strategy and surrounding macro-environment (Approx. 350 words, 10 Marks)
Discuss how this operations area is affected by, and enables Starbucks to respond to the wider macro- and business-environment. As part of this discussion, explain the global operations strategy adopted by Starbucks and consider how this area supports that strategy. Ensure that you clearly explain and justify your understanding of Starbucks’ global operations strategy.
3. Key requirements, capabilities and challenges (Approx. 350 words, 10 Marks)
Describe the key operations requirements and challenges faced by Starbucks in achieving excellence in the chosen area of operations. Requirements should relate to the day to day needs of the operation, and consider what is required for the effective functioning of that are of Starbucks’ operations. Discuss the capabilities of Starbuck in this operations area, for example, the people, systems and infrastructure. Finally, discuss at least two (2) specific challenges/problems faced as a result of realising these requirements.
For example, if quality management is chosen, then a requirement may be maintaining high levels of product and service quality. A challenge may be responding to changing customer needs or the impact of technology on service quality delivery.
4. Analysis and evaluation of chosen operational area (Approx. 650 words, 20 Marks)
Discuss the management of resources within this operations area of Starbucks, and how it impacts the organisations operations performance. Examine and evaluate how the organization manages its resources within these areas to fulfil the requirements above, and how it responds to the challenges/problems identified. In your discussion, you should draw on theory, concepts and tools within this operational area and examples from Starbucks.
For example, if ‘Planning and control’ is chosen, you are expected to discuss how Starbucks manages one or more areas of its planning and control activities and the impact on Starbucks’ operations. In this case relevant theory may relate to loading, sequencing or scheduling of Starbucks’ activities.
5. Recommendations (Approx. 350 words, 10 Marks)
What recommendations would you make about how to improve this aspect of Starbucks operations? Identify 2 to 3 improvements based on the analysis in the previous sections, that is, there should be a clear link between the previous discussion of challenges/problems, and the described improvements.
6. Conclusions (Approx. 150 words, 5 Marks)
Conclude your report by summarizing the work done, the main findings and recommendations for improvement.
Important: Your PART B report should strive for a good balance between theory and practice in discussing the case of Starbucks, and to be concise in the presentation of the case. It is crucial that you use evidence from Starbucks throughout your report.