Control Mechanisms and the Starbucks Corporation
The purpose of this paper is to identify four types of control mechanisms, feed-forward, concurrent, feedback, and financial, and their application in the Starbuck Corporation. The control mechanisms are compared and contrasted along with determining the effectiveness of these control mechanisms, and examining the positive and negative reactions. Finally, students will explain how these controls affect the four functions of management. Control Mechanisms
Every business needs to have controls in place to remain competitive and survive in business. Without controls, the company would operate in chaos for a short period before the business collapses. When operating a business, a manager needs to understand the different control types; bureaucratic, market, and clan. Within each of these control types, control mechanisms exist that define the type of control used. Feed-forward
Feed-forward is the control mechanism that establishes guidelines for future events and is proactive rather than reactive. By planning future events within a business, less chaos or "fires" will need to be put out. It also allows regular employees to make decisions without needing managerial approval. Concurrent
Concurrent control mechanisms are those that take place in real-time. With the growing use of technology, concurrent mechanisms are the most prolific mechanism in any organization. In the case of Starbucks, technology allows managers to monitor outflow, product consumption, trends, etc. Feedback
The feedback control mechanism takes place after an event. Once a problem or solution has been recognized, the information flows from one person to another. If it is a problem that has been acknowledged then the feedback is given promptly and then in writing for future use in discipline or training. If it is a solution that has been noticed, the solution is documented and implemented as a new procedure. Financial
Financial controls exist in every organization so money flow can be monitored. This can take place at the lowest level, the cash register at Starbucks, or at the highest level, the analysis of financial statements. The financial control also can be monitored by a manager when determining the need for staffing employees during certain periods throughout the day. Compare/Contrast
When discussing the four control mechanisms, their basic commonalities are that they are used in a cycle. The time in which the mechanisms are used is a difference. Another difference is that they are used for different types of control within the organization; however, feed-forward, concurrent, and feedback all have a direct relationship with the financial control mechanism. Application and Effectiveness
For nearly 40 years, Starbucks has grown into a large and successful business. Maintaining control is vital for survival. “Control systems are designed to eliminate idiosyncratic behavior and keep employees directed toward achieving the goals of the firm” (Bateman & Snell, 2009, p. 603). Feed-forward control is used to maintain growth in a very competitive and complex marketplace. Starbucks does extensive research on factual information, like how much coffee is being consumed in a certain areas. This and other research will lower the chance of failure, fluxes in the economy, and trends in the marketplace. A very proactive organization, Starbucks is very effective at feed-forward control. For example, their commitment to ethically sourcing and roasting coffee is one of many reasons for success. According to Jim Donald, CEO of Starbucks, “store visits are a fundamental part of concurrent control” (Bateman & Snell. 2009. p. 580). For example, the CEO of Starbucks is a firm believer of visiting with managers and front-line workers to monitor properly the corporation’s standings. This concurrent control enables the executives to obtain firsthand information of the employees’ and customers’...
References: Bateman, T.S., & Snell, S.A. (2009). Management: Leading and collaborating in a competitive world. 8th edition. Retrieved May 30, 2010 from https://ecampus.phoenix.edu/content/eBookLibrary2/content/TOC.aspx?assetdataid=0dd00b95-d78d-40a8-bf5e-3f72f654d901&assetmetaid=f65d6fdb-d2b7-4710-8429-2e86eeb1129c.
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