Starbucks Case Study

Introduction

The main reason behind every successful business is nothing less than the operational strategy. Business operations are the collective efforts by the management for running the business smoothly with the motive of earning maximum profit. The operational function makes the process systematic through many departments depending on the size of the business. The study highlights the operational function of Starbucks established in 1971 as a retailer of whole bean and ground coffee along with tea and spices in Seattle’s Pike Place Market. The company focuses on business operation and expanding the business with a wider range of customers with a gross profit margin of 21.5% with 40% market share (Starbucks, 2020). Starbucks emphasises premium design for the goods and services by improving the quality using location strategy and quality control. The decision-making process followed by the company effectively supported the business operation ensuring to maintain the high-end brand image for a longer time. The use of the premium character in quality management can be carefully analysed by sources of coffee beans collected from the farmers who comply with Starbucks quality standards. Each of the operational functions including the capacity design, layout design, location strategy along with human resources can help the company for positioning and increasing business growth.

Functions of business operation

Operation management can be effectively executed through the various functions that make the process continue within the organisation with more accuracy and accountability to deliver the product or services at the targeted level. Starbucks looks forward into the following operational functions apart from aiding the increase of production and distribution of products to the right consumers. As proposed by Richey et al. (2020), the operational function also considers scheduling and maintenance for streamlining the processes and allowing the company to maintain the flexibility among the management positions through training and retention strategies for employees involved in the process.

Operational strategy

Formulating an effective strategy for designing the goods and services can make the task possible for the company to set the right pricing strategy involving manufacturers and good design. Building the brand image acknowledgements other manufacturers to use the design strategy like Starbucks mugs for creating a better impression over the consumers. As stated by Tsai et al. (2020), the operational strategy measures and controls other functions systematically and ensures that the company can reflect the branding decision through improvement in the quality and timely delivery at the selected markets.

Quality control

Managing the quality is the main goal behind the operational function as it makes the process successful by reaching desirable customers at different locations. Starbucks used the premium character in quality management and selected the best quality coffee beans from the certified farmers under Starbucks Coffee and Farmer Equity. The company makes an effective decision for building a better relationship with the farmers through operation management and maintaining high quality to align with the firm’s premium brand image.