Starbucks Corporate CultureKatie Brindley, Michelle Grant,

Evangelita Nez, Ryan Scalmanini

and Robin Tigler

University of Phoenix

PSY428 – Organizational Psychology

May 18, 2009

Introduction

› The following topics will be discussed:

– Diversity and Customer Focus– Organizational Structure– Networking– Organizational Ethics– Employee Relations– Corporate Citizenship

Diversity and Customer Focus

› Starbucks is not a “franchise”› Customer base includes all nationalities› Repeat customers include business

professionals, healthcare professionals, students

› Store locations are international› Sites include schools, malls, hospitals,

airports, grocery chains

Diversity and Customer Focus

› Management execs regularly visit stores to ensure quality

› Strategies are implemented to enhance benefits for customers and employees

› Customer ownership and loyalty are key to success

› Customer feedback regularly solicited

Organizational Structure

› Howard Schultz – CEO› Restructuring has created new positions for

flatter organization:

– Global Real Estate Design Mgr– Global Strategy Mgr– Human Resource Strategy Mgr– Customer Experience Mgr– Marketing & Brand Strategy Mgr– Store expeditors at all locations

Organizational Structure

› Flatter organizational structure will:

– Lead to more efficient and more effective business strategy

– Streamline information flow from customer and low-tier employee to corporate level

– Keep customer and bottom line a priority to Starbucks business strategy

– Utilize new employee manual to streamline production and increase employee efficiency

Starbucks Networking

› “My Starbucks Idea” social networking site launched in March 2008:

– Customers play role in shaping company’s future – Re-ignites emotional attachment with customers – Builds a network of loyal and dedicated clientele – Allows open forum for ideas and discussion – Provide customers the ability to provide ideas on

products and service – www.Mystarbucksidea.com

Organizational Ethics

› Supports six point mission statement › Mission statement is guiding principle and

holds it up as a filter for decision making› Employee training includes review of mission

statement, customer service theory and corporate culture

› Starbucks New Partner Training Plan includes training on ethics, ergonomics, safety, legal compliance, hands-on training

Employee Relations

› Starbucks promotes frequent visits to store locations from regional/district mgrs

› Encourages open employee communications › Starbucks values each employee as “partner”› Employees provided medical, vision/dental,

401k/stock options, tuition reimbursement, vacation

Effects of Organizational Ethics and Corporate Culture

› Employees share in “Starbucks Experience “› Reduction in employee turnover rate

– 20% Management– 80% Lower tier (Avg retail turnover rate + 200%)

› Results in more satisfied/happy employees› Results in value oriented ethics

Corporate Citizenship

› Developed the Shared Planet™:– Reflects company’s desire to conduct business in

responsible manner

› Long-term plans include improving corporate ethics by 2015 by:– Ethical sourcing– Environmental stewardship – Community involvement.

› Created International Youth Foundation, Give2Asia, China Education Project

Conclusion

› Starbucks has become the most successful company in gourmet coffee by integrating:

– Restructuring of organization– Social Networking– Focus on Diversity and Customer Service– Global promotion of ethical business practices– Strengthening employee relations– Promoting corporate citizenship

ReferencesBaldwin, G. (2008, July). Saving starbucks: the next step in the chains revival. Retrieved May 3, 2009, from

Franchise Times Web site:http://www.franchisetimes.com/content/story_result.php?article=00931

Durham, H. (2009, March 27). Our new seasonal coffees. Retrieved May 3, 2009, from

Starbucks coffee company Web site: http://www.starbucks.com/coffee/b213-our-new-seasonal-coffees.aspx

Great entrepreneurs. (2001). Retrieved May 3, 2009, from My Primetime Web site: http://www.myprimetime.com/work/ge/schultzbio/

Howard Schultz: Starbucks’ first mate. (n.d.). Entrepreneur. Retrieved May 2, 2009 http://www.entrepreneur.com/growyourbusiness/radicalsandvisionaries/article197692.html

Hammer, M (October 2003). Pleasing employees, pouring profits. Workforce Management, 58(2) Retrieved on May 2, 2009, from Gale database

Roberts, J. (2008, June 8). Social networking for business is next big thing. Retrieved May 3, 2009, from Business News Web site: http://www.commercialappeal.com/news/2008/jun/08/social-networking/

Reuters. (2008). Starbucks Unveils Leadership Structure To Execute Transformation Of Company. Retrieved May 1, 2009, from http://www.reuters.com/article/pressRelease/idUS203894+11-Jan-2008+BW20080111

Simpson, J. (2009, March 16). Three great coffees for our clover stores in march. Retrieved May 3, 2009, from Starbucks Coffee Company Web site: http://www.starbucks.com/coffee/b179-three-great-coffees-for-our-clover-stores-in-march-.aspx

Spolsky, J. (2008, August). How hard could it be? : good system, bad system. Inc. The Daily Resource For Entrepreneurs. www.inc.com/magazine/20080801/how-hard-could-it-be-good-system-bad-system.htm

ReferencesStarbucks. (2008). My starbucks idea. Retrieved May 3, 2009, from Starbucks CorporationWeb site:

http://mystarbucksidea.force.com/ (2001).

Starbucks Coffee. (2009).Retrieved May 3, 2009, from Starbucks Coffee Company Web

site: http://www.starbucks.com/

Starbucks corp: board of directors. (2009). Retrieved May 3, 2009, from BusinessWeek

Website:http://investing.businessweek.com/research/stocks/people/board.asp?ric=SBUX

Starbucks Union. (2004). NLRB decision in starbucks election petition. Retrieved May 16, 2009, from http://www.starbucksunion.org/node/77

Starbucks unveils new strategic initiatives to transform and innovate the customer Experience. (2008, March 19). BusinessWire. Retrieved May 3, 2009, from http://www.businesswire.com/portal/site/google/?ndmViewId=news_view&newsId= 20080319006060&newsLang=en site:

Ward, S. (2009). Business Networking. Retrieved May 17, 2009, from Small Business:

Canada Web site: http://sbinfocanada.about.com/cs/marketing/g/busnetworking.htm

Weber, G. (February 2005). Preserving the starbucks counter culture. Workforce Management, 28-34. Retrieved on May 16, 2009 from,

http://www.workforce.com/section/06/feature/23/94/44/