Starbucks - Starbucks Delivering Customer Service Group 2...

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Starbucks: Delivering Customer Service Group 2: Casey Swenson Chelsea Johnson Yesenia Torres Marcos Solis
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Table of Contents I. Executive Summary……………………………………………pg 3 II. Summary of the Background of the Case……………………...pg 4 III. Detailed Description of the Main Marketing Issues…………...pg 6 IV. Analysis of the Case……………………………………………pg 8 V. Possible Alternatives…………………………………………...pg 9 VI. Conclusion………………………………………………… .... pg 10 Figures: Figure 1……………………………………………………………..pg 11 I. Executive Summary 2
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Starbucks’ value proposition is based on three components, the first being the quality of the coffee served, second was service, and third was atmosphere. While the company was continuing to grow, research showed that they are “not always meeting our customers’ expectations in the area of customer satisfaction” (pg. 1). Christine Day, the senior vice president of administration in North America for Starbucks, has come up with a plan to improve their customer service by investing “an additional $40 million annually in the company’s 4,500 stores, which would allow each store to add the equivalent of 20 hours of labor a week” (pg. 1). Starbucks asked its customers what changes needed to be made to make them feel more valued “‘improvements to service’- in particular, speed-of-service- had been mentioned most frequently” (pg. 12). The idea is that investing this money would mean that there would be more employees working at one time so they can improve their speed-of-service, which in turn would improve their overall customer service. In the early stages of the company, beverages only accounted for a small portion of their revenue, but today the account for about 77%. With beverages accounting for such a large percentage of the overall revenue, it is an area where Starbucks need to work hard to keep those customers happy. When employees are hired they go through two types of training, “hard skills” which is using the register and mixing drinks, and their “soft skills” which referred to their customer service skills. So while the employees undergo a large amount of training to make the handcrafted beverages, over time the complexity of mixing the drinks has greatly increased, which increases the time to make a single drink. Customers really began to make beverages their own, which “created a tension between product quality and customer focus” (pg. 5). We decided that it was a good idea to follow through with Christine Day’s plan to invest $40,000,000 in customer service, because the main problem that needs to be solved is the speed- of-service and the best way to improve speed-of-service, without sacrificing any other service is to add the equivalent of 20 hours of labor a week. Of the 3,377 customers each store has, you can
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