Strategic Issues Paper
University of Phoenix
November 3, 2008
Strategic Issues Paper
In today's business environment, an effective strategy is critical for an organization to attain its vision. A company must reflect upon internal strengths and weaknesses, external opportunities and threats, and consider the associated trends using benchmarked companies. One company who’s made this recognition is Starbucks. The company recognizes the major strategic issues involved as protection of coffee growers to achieve future supply, keep the brand image and remain innovative, new market strategy, leadership and culture. Using resources from the University of Phoenix, the purpose of this paper is to identify several companies that have demonstrated strategic thinking about issues that are similar to those faced by the selected organization. This paper will provide an overview of the issues, identify different strategies utilized by those companies to address them and discuss the outcomes. In addition, the paper will suggest alternatives to Starbucks strategy based on the benchmarked companies. Executive Summary
Starbucks is a very profitable organization. Starbucks is different than many businesses; they combine aggressive marketing strategies with corporate responsibility. Their financial performance was overwhelmingly positive and outstanding achievements. Starbucks vision statement is developed to express the aspirations of the executive leadership and works concurrently with its mission statement. Their vision concentrates on how to treat people including their employees, diversity, customer satisfaction, community contributions, and sustaining a profit. Starbucks vision statement is “to establish Starbucks as the premier purveyor of the finest coffee in the world, to satisfy customers, provide a great work environment and treat each other with respect and dignity, to contribute positively to their environment, to make profitability for future success, embrace business diversity, to be highest standards of coffee purchasing.” (Starbucks Corporation, 2008). Starbuck’s Strategic Plan
The company recognizes the major strategic issues involved as protection of coffee growers to achieve future supply, keep the brand image and remain innovative, new market strategy, leadership and culture. “Starbucks strategy is to maximize market its exposure by placing retail stores in high-traffic, high-visibility locations.” (Starbucks Corporation, 2007) Benchmarked Companies
“To avoid obsolescence and promote innovation, a firm must be aware of technological changes that might influence its industry.” (Pearce, 2004 p.14). General Motors (GM) has been a leader in the auto industry which over the past few decades has continued to lose market share to foreign competition. When consumers think of the innovative technology in the auto industry they think of GM! For this to happen GM can no longer be a quick follower, but must be an industry leader in technological advances in the auto industry. GM must offer a variety of alternative vehicles that meet consumer demands and government regulations. They are focusing on achieving high levels of customer satisfaction: Customer: providing innovative products that provide customer choices in alternative fueled vehicles. GM stakeholders will receive increased profits via increased sales and market share. Starbucks is following General Motors theory in keeping up with innovative technology. This means the company is looking for technology that helps cut costs and improve the company’s ability to increase profits. Technology personnel have to focus on having a reliable and efficient plan and an even better execution in time of need. Costly technological mistakes will have a direct impact on Starbuck’s vision and its ability to retain and attract employees and customers. Customer Responsiveness...