Unit 1 Assignment.docx

Unit 1 Assignment.docx - Efsta| 1 Student Panos Efsta Essay...

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Efsta | 1 Student: Panos Efsta Essay: Unit 1 Assignment March 31, 2019 Course: BS400.XB1B.17SPR Instructor: Dr. Gregory Coughlin “Starbucks” Describe the value Starbucks creates for its customers and explain how it creates this value. Starbucks still strives to be “a different kind of company”; a company that not only celebrates coffee and rich tradition but one that also brings the feeling of connection to all. Starbucks has capitalized on many competitive advantages; they have managed to create value for their customers in ways that only a few can. The foundation of that value is due to a continued focus on the importance of innovation, efficiency, quality, and superior customer service. Starbucks uses their strengths and competitive advantages to differentiate themselves from their many rivals in the coffee industry. Much of their success in these areas is a result of the efforts of the CEO, Howard Schultz who made many positive changes after 2008 with surprising success considering the economic condition at the time. During the financial crisis, Starbucks did not back away from their commitment to responsibility. “Instead they announced a set of ambitious goals – which included committing to improve ethical sourcing of coffee and throughout their supply chain” [Sta17]. Analyze the importance of innovation, efficiency, quality, and customer responsiveness have been to Starbucks.
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Efsta | 2 Starbucks realized, especially during the financial crisis that product pricing, as well as the speed of service, were critical components of the brand’s success. However, to reduce its cost and invest in innovation, several cost improvements had to take place, to improve efficiency that could then pass on to the consumer as a slower rate of price hikes, and improved service delivery. Their lean thinking team “found that by making simple changes, such as placing commonly ordered syrup flavors closer to where drinks are made, they could shave several seconds off the time it took to make a drink, and give employees more time to interact with customers. Faster customer service meant higher customer satisfaction.” [CHA13]. Between negotiating lower leases, improving product margins by buying in bulk, as well as removing “slow-movers,” the Starbucks team was able to contain and remove several of its obstacles preventing it from achieving its growth goals. The Starbucks team didn’t focus on its bottom line but its customer. They could have easily increased the price of its products to
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