Starbucks Case Analysis Essay examples

3061 Words Dec 9th, 2005 13 Pages
Company Background
Three Seattle academics and entrepreneurs, English teacher Jerry Baldwin, history teacher Zev Siegel, and writer Gordon Bowker, started the Starbucks Corporation in 1997. Their primary product was the selling of whole bean coffee in one Seattle store. By early 1980's, this business had grown into four stores selling the coffee beans, a roasting facility, and a wholesale business for local restaurants. "There store did not offer fresh-brewed coffee sold by the cup, but tasting samples were sometimes available" (Thompson, Jr. et al, 2005). In 1982, Howard Schultz left his job as vice president and general manager of a Swedish company and assumed his new responsibilities as head of marketing and overseeing Starbucks
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Starbucks' policy towards employees is laid back and supportive. Employees are empowered by management to make decisions without management referral and are encouraged to think of themselves as part of the business. Starbucks has avoided a hierarchical organizational structure and has no formal organization chart; however, the company has both functional and product based divisions with some employees reporting to both division heads. (Thompson, Jr. et al, 2005)
Starbucks is unique in that it offers its benefits package to both full-time and part-time employees, working at least 20 hours a week. The company has been able to provide broader coverage while maintaining relatively low monthly payments because most of their workforce is young and reasonably healthy. This generous package includes "medical and dental, vision and short-term disability insurance, as well as paid vacation, paid holidays, mental health/chemical dependency benefits, an employee assistance program, a 401k savings plan, and a stock option plan" ("Starbucks Corporation", 2003). Shultz believes that by offering a complete benefits program, employees feel financially or spiritually tied to their jobs which increases employee loyalty and encourages attentive service to the customer. Additionally, employee turnover is also discouraged by Starbucks' benefits, particularly with their stock option plan; also know as the Bean Stock Plan. ("Starbucks Corporation",

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