Starbucks Case Summary and Answers

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Case Questions:

1. What is Starbucks’ strategy? Is there good fit among its capabilities?

Starbucks has established itself as a seller of specialty coffee through its stores and has targeted office goers and certain families, who visit Starbucks to either relax, read, chat, or socialize. To achieve its long term goal of becoming the most recognized and most respected brand of coffee in the world, it has recently expanded its operations to include bottled coffee and is also looking at presence in supermarkets which will fuel growth and make Starbucks a household name. As these activities are consistent with the overall strategy, this strategy is a great example of a first order fit. Starbucks has an established sourcing team which buys coffee from all over the world to offer its customers a variety as well as have a wide supplier base. It has a specialized operations team to develop signature blends to maintain exclusivity and uses technology and copyright software to document its roasting and blending curves. The real estate and design teams ensure that Starbucks is located in any foreseeable retail location such as a corner, trapezoid or a triangle. While Starbucks has developed a packaging system to ensure freshness and longer shelf life, accurate forecasts from the Supply Chain Operations help to create a fully integrated manufacturing and distribution process to eliminate redundancy. The various activities in its value chain emphasize on high quality products and an exclusive coffee experience for its customers. Such consistent activities complement each other and reinforce the capabilities that Starbucks possesses, thus maintaining a second order and third order fit at all times.

2. How should Starbucks leverage its resource and capabilities to achieve its growth objective? Consider the tradeoffs.

Starbucks is a strong value based organization and has some key resources and capabilities and resources which can be identified as brand...
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