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  • The future of Starbucks in terms of leadership depends on how the company will manage innovation and expansion strategies. For instance, the company intends to have 12,500 stores in the US alone by 2015, up from 11,128 in 2012 (Hitt, Ireland & Hoskisson 2013, p. 9). Starbucks has also become a dominant player in large markets in Asia such as China, India and Vietnam (Hitt, Ireland & Hoskisson 2013, p. 9). Success in the service and product innovations and expansion into new markets will depend on how the leadership at Starbucks moves the organisation forward by defining the future direction, sticking to that direction and continuing to provide guidelines on how to stay in that direction so that the entire teams in different countries move in a coordinated way (Holland 2000, p. 21). The role of the leadership in this case is to ensure that changes aimed at reaching the intended objectives are sustained. By doing so, the company will be able to have a formidable team to ensure that progress is sustained even after Howard Schultz steps aside as CEO of the company or when he retires, given that he is currently aged 60.

The future of Starbucks in terms of leadership depends on how the company will manage innovation and expansion strategies. For instance, the company intends to have 12,500 stores in the US alone by 2015, up from 11,128 in 2012 (Hitt, Ireland & Hoskisson 2013, p. 9). Starbucks has also become a dominant player in large markets in Asia such as China, India and Vietnam (Hitt, Ireland & Hoskisson 2013, p. 9). Success in the service and product innovations and expansion into new markets will depend on how the leadership at Starbucks moves the organisation forward by defining the future direction, sticking to that direction and continuing to provide guidelines on how to stay in that direction so that the entire teams in different countries move in a coordinated way (Holland 2000, p. 21). The role of the leadership in this case is to ensure that changes aimed at reaching the intended objectives are sustained. By doing so, the company will be able to have a formidable team to ensure that progress is sustained even after Howard Schultz steps aside as CEO of the company or when he retires, given that he is currently aged 60. Essay Example

  • Category:
    Business
  • Document type:
    Assignment
  • Level:
    Undergraduate
  • Page:
    2
  • Words:
    1211

Brief description of the history of Starbucks

Starbucks started its operations in 1971 when it opened its first store in Pike Place Market in Seattle, the United States (Starbucks 2014a). The idea of setting up the company was conceived by three friends, Gordon Bowker, Gerald (Jerry) Baldwin and Zev Siegel, who modelled the first Starbucks store on the Peet’s Coffee and Tea shop that was located in Berkeley, California (Pendergrast, 2013, p. 353). By 1980, Starbucks had established six retail stores and was offering coffee beans wholesale to supermarkets and restaurants. In 1982, Howard Schultz, who is the current chairman and CEO of Starbucks, joined the company as director of retail operations and marketing. In the same year, Starbucks started offering coffee to espresso bars and fine restaurants (Starbucks 2014a). The following year, Starbucks purchased Peet’s and four years later, the management of the firm sold it to Howard Schultz (Pendergrast, 2013, p. 353).

Upon the acquisition, Schultz embarked on transforming the company into a coffeehouse chain specialising in espresso-based milk drinks including latte and cappuccino. He noted that coffeehouses offered an alternative place for people to meet outside of the workplace and home, and that the “Starbuck experience” involved more than just coffee. The coffee bars were expanded to other cities in the United States, including Los Angeles and Chicago. In 1992, the company went public and continued to grow across the United States and Canada. It went on to open its first overseas store (outside of North America) in Japan in 1996 and later in Singapore (Pendergrast, 2013, p. 353; Starbucks 2014a).

Schultz stepped down as CEO of Starbucks in 2001 so as to become the company’s chief global strategist but returned to the position of CEO in January 2008. He continues to guide the company’s mission of inspiring and nurturing the human spirit through the company’s slogan: “one person, one cup, and one neighborhood” (Starbucks 2014b).

By the year 2012, Starbucks had over 17,000 stores in 55 countries (Pendergrast, 2013, p. 354). Today, this number has grown to more than 18,000 stores located in 62 countries (Starbucks 2014b). Starbucks regards itself as the premier roaster and retailer of specialty coffee in the world. It is also the world’s biggest buyer of fair trade certified coffee (Pendergrast, 2013, p. 354).

What the future holds for Starbucks with respect to leadership

One of the key factors that have driven Starbucks to the successful position it is in today has been the company’s skilled executive leadership. Starbucks’s executive leadership team comprises top-notch executives led by a man with a vision, Howard Schultz, who is the board chairman, CEO and president of the company (Bussing-Burks 2009, p. 75). The fact that Schultz joined the company in 1982 as director of retail operations and marketing exposed him to the operations of the company in that he had a better understanding of the organisation when he eventually become its leader. He is described as a strong director, a person with a vision, and a charismatic leader who inspires those around him to achieve even more (Bussing-Burks 2009, p. 76). He is also seen to be alert and considerate of what consumers want, which he ensures that the company fulfils. In addition to being charismatic, Schultz can also be described as a transformational leader. Charismatic leadership style encourages enthusiasm, loyalty as well as high level of performance (Lussier 2009, p. 323). On the other hand, a transformational leadership style fosters continuous learning, innovation and change (Lussier 2009, p. 323). It is because of such leadership qualities that Starbucks has been able to grow from the six stores that Schultz bought in 1987 (Bussing-Burks 2009, p. 76) to over 18,000 in the present day.

Any company that wants to succeed in both the present and the future must continue to achieve outstanding results by having a compelling and elaborate vision, and implementing principle-centred actions (Allenbaugh 2002, p. 23). This notion has clearly been reflected in Starbucks’ success through the years since 1971. The company’s leadership has continued to come up with innovative ideas that are consistent with the needs of the market, and this is significant in ensuring that the company continues to be successful in the future. For instance, according to Hellriegel and Slocum (2011, p. 84), the company values its baristas (who are referred to as associates). These baristas have been trained to work as a well-oiled machine as they take orders from customers and serve them in Starbucks coffee bars. The baristas work together as team and are important for the success of Starbucks in the future. The company also ensures that its employees treat each other with high respect and dignity and ensures that they are provided with a favourable working environment. This example shows that the leadership at the company values teamwork. This is important in ensuring that individual performances are pooled together by having a shared sense of purpose (Adair 2010, p. 73). It is also evident that that the company’s leadership focuses on having a competitive edge not only through innovative products and services but also by having teams that support the organisation as it interacts with customers.

The future of Starbucks in terms of leadership depends on how the company will manage innovation and expansion strategies. For instance, the company intends to have 12,500 stores in the US alone by 2015, up from 11,128 in 2012 (Hitt, Ireland & Hoskisson 2013, p. 9). Starbucks has also become a dominant player in large markets in Asia such as China, India and Vietnam (Hitt, Ireland & Hoskisson 2013, p. 9). Success in the service and product innovations and expansion into new markets will depend on how the leadership at Starbucks moves the organisation forward by defining the future direction, sticking to that direction and continuing to provide guidelines on how to stay in that direction so that the entire teams in different countries move in a coordinated way (Holland 2000, p. 21). The role of the leadership in this case is to ensure that changes aimed at reaching the intended objectives are sustained. By doing so, the company will be able to have a formidable team to ensure that progress is sustained even after Howard Schultz steps aside as CEO of the company or when he retires, given that he is currently aged 60.

References

Adair, J 2010, Strategic leadership: how to think and plan strategically and provide direction, Kogan Page Limited, London.

Allenbaugh, E 2002, Deliberate success: realize your vision with purpose, passion, and performance, Career Press, Pompton Plains, NJ.

Bussing-Burks, M 2009, Starbucks, ABC-CLIO, Santa Barbara.

Hellriegel, D & Slocum, J 2011, Organizational behaviour, 13th edition, South-Western Cengage Learning, Mason, OH.

Hitt, M, Ireland, R D & Hoskisson, R 2013, Strategic management: competitiveness and globalization, 11th edition, Cengage Learning, Stamford, CT.

Holland, W E 2000, Change is the rule: practical actions for change on target, on time, on budget, Dearborn, New York.

Lussier, R 2009, Management fundamentals: concepts, applications, skill development, South-Western Cengage Learning, Mason, OH.

Pendergrast, M 2013, ‘Starbucks’, in A F Smith (ed), The Oxford encyclopaedia of food and drink in America, 2nd edition, Oxford University Press, pp. 353-354.

Starbucks 2014a, ‘Starbucks company timeline’, viewed 19 May 2014, <http://www.starbucks.com/about-us/company-information>

Starbucks 2014b, ‘Our heritage’, viewed 19 May 2014, <http://www.starbucks.com/about-us/our-heritage>