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Howard Schultz and Starbucks Essay


Starbucks Corporation is a Washington Seattle based coffee house, chain store and a company. This company has attained global recognition due to it consistent success in the coffee industry. Research has revealed that Starbucks is currently the biggest coffee company in the world (Glickman, 2010). It has more than fifteen thousand coffee stores in fifty five nations.

Their stores are located in various countries such as South Korea, China, Great Britain, Japan Canada and the United States of America (Jon, 2005). The history of the organization records that the initial Starbuck firm was started on the 30th of March 1971 in Seattle Washington (Glickman, 2010).

Since the first ever management by pioneer entrepreneurs such as Gordon Bowker, Zev Siegl and Jerry Baldwin, it is vital to mention that the company has had several management turnovers.

The situation described in this essay is about Howard Schultz who is currently the new Chief Executive Officer at Starbucks. As a coffee company, Starbucks has indeed suffered tremendously hard economic time that has seen its stock decline since 2001 under the new management of Ted Waitt (Jones & George, 2007).

The company is currently headquartered in Wall Street in the United States. Notably, the main business function of the company is the selling coffee products both in the local and external markets.

In spite of the current, management and economic dilemma facing the company, it is worth noting that it has been on the performance record for considerably long period of time amidst tight and dynamic market competition.

Howard Schultz who is the chief executive officer and president of Starbucks had to resume his role in 2008 after several years outside the company. The modern company presents a broad managerial task that needs to be addressed with urgency.

The management challenge is being attributed to the multinational status of the company. Jones and George (2011) note that management has evolved into a dynamic transitional process. They argue that the original style of corporate management of companies needs to be made more comprehensive (Jones & George, 2011).

Needless to say, there is a particular problem that has to be solved in the case presented in the article. It is imperative to note that since Howard left his CEO’s position, the company sales declined gradually (Jones & George, 2007). This was presumable due to the fact that the new management was not very competent.

This led to lose of market share bearing in mind that competitors of the company took advantage of the weak managerial function at Starbucks to boost their market opportunities.

As a matter of fact, the trend of the company has deteriorated for some time now. Nevertheless, economic analysts anticipate that with the return of the former CEO, his strategies will act as a jump-start towards positive growth.

In this case, the impending problem is how to improve the management skills and strategies to boost the company’s performance. Notably, the new CEO has had problems trying to boost the overall sales. At this juncture, Schultz is being perceived as the only CEO who will restore the company’s trend back to its normal state (Jones & George, 2007).

Nevertheless, there are those who really doubt whether he will make it with the old strategies he used previously. In this case, they assume that if he sticks to his old strategies, no much change will be realized. On the same note, there are individuals who feel that Schultz has what it takes to provide the company with high quality management skills.

As a result, the major management challenge facing Howard Schultz at Starbucks is how to reignite the company’s operations in order to raise its investment level. Notably, he has outlined strategies that appear tricky for him as analysts comment.

He intends to minimize the number of new stores and increase overseas investments. Moreover, he intends to establish a new store design and develop new products (Jones & George, 2007).

Needless to say, the fact that the CEO intends to expand the company internationally, it may not necessarily lead to better performance in the international arena bearing in mind that it largely presents a steeper challenge for him since the idea does not appear to be financially feasible.

Nevertheless, there are specific skills that have helped him to perform fairly well as Starbuck’s new CEO. Notably, a manager needs to have effective communications skills in order to be able to explain his management expectations and the anticipated results (Waddell, 2006).

This is evident from the article that Schultz has been a good vocal chairman since 2000 and this has also been reflected once he took his managerial position later. Moreover, a manager should have a high quality leadership skill that enhances him to handle different organizational situations and challenges that emerge from time to time (Jones & George, 2012).

For instance, Howard Schultz is familiar with effective strategies that he has already outlined and that can boost the growth of the company. As a leader, he is determined to reignite the performance company. In addition to this, a manager should be knowledgeable enough and need to be updated with information that has positive effects on the organizational goals (Jones & George, 2012).

In this case, Howard outlines an action plan of establishing new products and design of the new stores that are yet to be established in order to create a good link with the customers. Needless to say, a manager should be goal oriented and have a visionary focus for an organization (Waddell, 2006).

From the current case at Starbucks, the Chief Executive Officer has signaled his action to expand the company while closing down the stores that are not doing well. In this case, one can argue that the manager is witty and knowledgeable, a factor that has made him to streamline the company’s management structure.

Indeed, it is worth noting that management has become an international business affair. The managers of global modern have a challenging task of meeting the demands of various geographical markets while at the same time maintain profitability of an organization. As a matter of fact, the latter scenario is applicable to the current case at Starbucks.

Parallel to the profit strategies, the chief executive of Starbucks needs to drive the whole Starbuck fraternity to a positive change. A change towards market focused operations is necessary. The company has to continue establishing its strong coffee manufacturing base.

Starbucks is a multi brand corporation which has been operating by keeping a keen focus to the concerns of shareholders. This culture of allowing customers and other stakeholders to track the company online needs should be revived.

Jones and George (2011) are quite categorical that the process of management is quite a life changing experience for modern organizations. Top executives need to develop excellent corporate responsibility and effective communication. It is critical to simplify the task of corporate management especially as it is the case with the CEO at Starbucks.

The basic technique to employ in such high profile management case is to adopt and embrace team leadership (Glickman, 2010). This is a skill which involves creating an appeal which transcends ones managerial capacity. The company should decentralize its management functions b creating small, manageable and dynamic teams. The chief executive officer is faced with a challenge of extending quality breadth to the global level.

This comes with the fact that he is occupying a robust position. The company has to continue having an exemplary performance. This will be achieved by paying more attention to the needs of employees which can only be possible when management is sized down. The case has changed and Howard has to comply accordingly.

It is important to overcome the norm of rigidity which dominated old age companies (Jon, 2005). The enlisting of all branch managers in organizational decision making helps new executives to stabilize their organizations (Jones & George (2011). Howard will have to embrace and depend on subordinate ideas during his probation period as the chief executive officer of Starbucks coffee company.

In conclusion, it is important to note that the desire to succeed in corporate management is an important drive. Being ambitious and self driven as a CEO amounts to generation of good performance. Business executives must learn to be determined to continue developing their skills. The world has become highly competitive and this is the only way to become top class management professionals.

References

Glickman, L. (2010). Everything but the Coffee: Learning about America from Starbucks. The Journal of American History, 97(3), 884-885.

Jon, D. (2005). Brand trust and brand extension acceptance: the relationship. The Journal of Product and Brand Management, 14(1), 4-13.

Jones, G. & George, J. (2011). Contemporary Management. Pennsylvania: Pennsylvania State University.

Jones, G. & George J. (2007). Contemporary management. New York: McGraw-Hill

Jones, G. & George, J. (2012). Essentials of Contemporary Management. New York: McGraw-Hill.

Waddell, D. (2006). Contemporary management. New York: McGraw-Hill

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