Running Head: PLANNING

AND STRATEGY: STARBUCKS

Planning and Strategy: STARBUCKS - Mission, Goals and Strategies Trident University International Kevin S. Varner Principles of Management BHS 312 Session Long Project Module Number 2 Coordinator Professor: Dr. Mickey Shachar Core Faculty: Monica Vargas May 10, 2011

PLANNING AND STRATEGY: STARBUCKS

"What Starbucks has created around coffee is an extension of the front porch. If you look at the UK, the English pub is an extension of people's homes but for a different beverage. Our stores have become a gathering and meeting place in addition to the coffee." ~ Howard Schultz The incredible success of Starbucks Corporation can be traced to a single minded drive by its founder, Howard Schultz. Not only to offer the finest coffees in the world, but to also create a similar coffee culture to what he experienced during a 1983 trip to Milan, Italy (Thompson 1999). Schultz would attempt to duplicate that coffee bar experience throughout the United States, and eventually world-wide. To achieve this he would first create a corporate culture that reflected the business mind-set of the original Starbucks store opened in 1971 at Pikes Place Market in Seattle, Washington. Starbucks Mission. As stated on the company website, the corporate mission is to inspire and nurture the human spirit one person, one cup and one neighborhood at a time. (Anonymous 2011, 4th paragraph) Goals. In order to accomplish this incredibly broad mission, Starbucks has created multiple, far reaching goals. The overall goal regarding coffee, their primary product, is to utilize the highest standards of quality while maintaining their ethical sourcing (purchasing) practices (Anonymous 2011). Other goals include; Environmental Stewardship, Community Support and Involvement, Farmer Support, and Recycling. All of these are rolled into an annual Global Responsibility Report, published on their website with 10 years of data, with all results certified by a CPA consulting firm.

PLANNING AND STRATEGY: STARBUCKS

Strategies and Implementation. To reach these goals, certain strategies were put in place and regularly verified and measured for results. In reaching their primary product goal of quality coffee ethically sourced, the company buys coffee that is verified through third-parties as meeting requirements for certification as Fairtrade, meeting C.A.F.E. Practices, or something similar. Looking deeper into these reports the measuring stick for this was to ensure 100% compliance with this goal by 2015. As of October 3, 2010 Starbucks reports 84% compliance. Other strategies to reach their multiple goals include; investing in farmers and farming communities with millions in loans, building new company-owned stores that meet requirements to be certified as Green buildings (highly efficient energy saving, water efficiency, low CO2 emissions, etc), increasing the number of beverages served in reusable cups and increasing recyclability of their own signature paper cups, reducing energy consumption, and purchasing renewable energy to supplement over 50% of their electricity consumption. To date many of the specific goals of the company have been achieved, or are progressing along the benchmarks created to measure annual success rates. In business meeting stated goals and driving toward a corporate mission does not always translate into a successful bottom line. However, in the case of Starbucks it has done just that. According to the second quarter reports of this year Starbucks profit has increased by 20%, which translates into a profit of $261.6 million this quarter (Allison 2011). This is after taking into account recent spikes in coffee prices, closing stores in Japan after the earthquake and tsunami, and a slight drop in shares.

PLANNING AND STRATEGY: STARBUCKS

Conclusion "While we are a coffee company at heart, Starbucks provides much more than the best cup of coffeewe offer a community gathering place where people come together to connect and discover new things." ~ Howard Schultz Starbucks Corporation has proven a number of things by creating an all encompassing mission, supported by broad reaching goals related to environmental stewardship with specific benchmarks for progress. Among them, the company has shown how goals can be very difficult over the long-term, but with obtainable benchmarks and firm direction along the way, even the most difficult can be reached. Also, and perhaps to a less business oriented degree, creating a mission and goals statement that emphasizes the effect of your corporation on the community and the environment as a whole can still lead to success.

PLANNING AND STRATEGY: STARBUCKS

References Allison, Melissa (2011) Starbucks profit up 20%; no plans to raise drink prices. Seattle Times business reporter; April 27, 2011. Retrieved from: http://o.seattletimes.nwsource.com/html/businesstechnology/2014892987_starbucks28.ht ml Anonymous (2011) Starbucks Company Profile. Retrieved from: http://www.starbucks.com/about-us/company-information Thompson, Arthur & Gamble, John (1999) Starbucks Case Study. Strategic Management: Concepts and Cases 11th Edition. McGraw-Hill Retrieved from: http://www.mhhe.com/business/management/thompson/11e/case/starbucks.html