Mr. Howard Schultz
2401 Utah Ave.
South Seattle, WA 98134
Dear Mr. Schultz:
First and foremost, M&M Consulting would like to thank you for giving us the opportunity to help you with the strategic problems facing your company. We understand the importance in terms of quality and staffing. We assure you that we will provide you with the best strategic solutions that will benefit both the company and its staff.
After reviewing the reward policy information provided by your company, we understand that the reward policy of Starbucks consists of both monetary and non-monetary rewards. Though it is evident that the company is not focusing on the former than the latter, Starbucks is after the high levels of satisfaction in the workplace.
The latter part of the proposal includes the set of actions that Starbucks could employ in order to arrive at necessary changes in the three policies aforementioned. The last section includes key pointers of drafting the policies and the steps that should be taken by the actors.
Description of The Management Dilemmas:
The Reward Policy:
In all facets of the business, Starbucks recognizes that putting people before products is as effective as placing core values at every aspect of the operation. In terms of staffing, each location has one manager, an assistant manager and 16 partners. The benefits package includes health, dental and vision care, stock options, or 401(k) for employees who work an average of 20 hours per week for over three months, free shift drinks and a free pound of coffee or tea each week that continue despite temporary disability or familial leave. Moreover, raises are based on semi-annual performance evaluations with raises that range from 0-5%. Though bonuses are not utilized, for each location the company gives away non-monetary rewards. As such, employees are given 30% discount on all merchandise. There are also programs that recognize individual contribution of Starbucks partners. For instance, unique to the company is the Green Apron recognition program that serves as both brand behaviors guide and non-monetary reward. Every partner receives the Green Apron book that is consists of company values and desired on-brand behaviors as well as peer recognition cards that are used by virtually all the employees from top management to recognizing even the smallest behavior on the spot stressing the importance of sense of ownership. More than the monetary rewards, Starbucks focuses on ‘team contribution’ to recognize how their performance and contributions make a difference.
The Recruitment and Selection Policy:
In terms of recruitment and selection, Starbucks is hiring about 200 employees per day to compensate with the growth rate of 5 stores per day. Recruitment practices include interviews that incorporate coffee tasting sessions; candidate bill of rights developed that emphasizing the use of phone calls and handwritten notes rather than form response letters. The goal of such is to determine how quickly applicants should hear back. Also, the company encourages recruiters to send out Starbucks gift card whether the applicant is hired or not for the purpose of treating job applicants like customers. The hiring process is strategically aligned to the vacant positions. Starbucks lives by its mission to embrace diversity develop and nurture employee and provide them with exceptional benefits. Application can be picked from any Starbucks store. There are phone and personal interviews with highly-situational questionnaires. Before being extended an offer, Starbucks trained the applicants first after passing the interviews.
The Development Policy:
Starbucks’ development framework centers two broad concerns. The first is the use of different IT systems and the second is the ‘Third Place’ environment. Presently, Starbucks is using the corporate headquarters to exercise controls over individual sites and that Total Quality Management is...
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