...Starbucks – Going global fast case study Prashansa Sunuwar King’s College affiliated with Westcliff University BUS 367 The Necessities of International Marketing and Culture Dr. Thien-Huong T. Ninh March 20, 2016 Abstract This paper addresses the various factors and risks that a company has to face while going global. This report is based on the case study focused on Starbucks. It answers various questions regarding issues that an international company like Starbucks has to face. The answers incorporate the elements that are both controllable and uncontrollable when a business is going global. The sources of risks that Starbucks is facing and what can be done to eliminate the risk are provided. Also, there are few suggestions regarding what Starbucks can do to improve profitability in Japan. Starbucks – Going Global Fast Case Fifteen years ago, Starbucks had 17 coffee shops in Seattle. Now, it has 19,000 outlets in 58 countries. According to the official website of Starbucks, Starbucks serves a wide variety of hot and cold drinks including espressos, cappuccinos, and even pastries and other delectable treats. Starbucks has become a meeting place for people. People go to Starbucks to chat, meet up, and even for meetings and rejuvenation. The success of Starbucks grew after Howard Schultz purchased Starbucks on 1981 and introduced Italian coffeehouse tradition in the United States in 1983. After Starbucks went public, the sales have increased by an average of 20 percent annually...
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...opposing forces. In a global environment, culture is a critical factor whereby the process of advancing cultural intelligence and international cultural competence would be the deciding element for the success of managers and leaders especially those who perform human resource (HR) functions. Within the cultural context, common elements are to be found including shared and dynamic nature surrounding norms, values and beliefs which are expressed through different behaviors, artifacts and interactions. It is necessary then for HR managers like Wolfgang to fulfill profitable relationships vested on the capability to reconcile cultural dimensions of pay systems from the headquarters to subsidiaries. Within Healthcare, there are economic, political and cultural forces that are influencing the operation. As part of the external environment, there is the need for Healthcare to align national cultural values of the subsidiaries with that of the organizational work culture. There are culturally indigenous and culturally alien practices within any organization that shape the actions and performance of the employees. Culture is considered as the lens through which motivation occurs. Motivations to do work differ greatly across cultures hence whey employees are subjected to within-culture and between-culture workplaces the level of performance is significantly different as well. Cultural backgrounds of the employees largely define the personal work values of the people, and this is evident...
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...between what is commonly expressed as international marketing and global marketing, which is a similar term. For the purposes of this lesson on international marketing and those that follow it, international marketing and global marketing are interchangeable. - marketing involves the firm in making one or more marketing mix decisions across national boundaries. At its most complex level, it involves the firm in establishing manufacturing facilities overseas and coordinating marketing strategies across the globe. Controllable element - it clearly defines the meaning of a business environment, which is the foundation to begin with before answering the question. it defines a business environment as " encompasses all those factors that affect a company's operations, and includes customers, competitors, stakeholders, suppliers, industry trends, regulations, other government activities, social and economic factors, and technological developments" However, the definition given is very general, it does not distinguish or point out which elements are controllable and which are not. To my own understanding, controllable elements, also known as internal elements, are those which are within the organization which are eligible to controlling the operation of an organization, which includes the management, the hierarchy of the business, the personnel, the missions and visions of the organization and etc. Uncontrollable element - World events or circumstances which significantly affect investment...
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...opposing forces. In a global environment, culture is a critical factor whereby the process of advancing cultural intelligence and international cultural competence would be the deciding element for the success of managers and leaders especially those who perform human resource (HR) functions. Within the cultural context, common elements are to be found including shared and dynamic nature surrounding norms, values and beliefs which are expressed through different behaviors, artifacts and interactions. It is necessary then for HR managers like Wolfgang to fulfill profitable relationships vested on the capability to reconcile cultural dimensions of pay systems from the headquarters to subsidiaries. Within Healthcare, there are economic, political and cultural forces that are influencing the operation. As part of the external environment, there is the need forHealthcare to align national cultural values of thesubsidiaries with that of the organizational work culture. There are culturally indigenous and culturally alien practices within any organization that shape the actions and performance of the employees. Culture is considered as the lens through which motivation occurs. Motivations to do work differ greatly across cultures hence whey employees are subjected to within-culture and between-culture workplaces the level of performance is significantly different as well. Cultural backgrounds of the employees largely define the personal work values of the people, and this is evident...
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...1. The authors describe a four-phase process for global expansion. What are the four phases? * In the initial entry phase, firms must establish a foothold in different foreign markets. Country markets of interest are identified as bases for future expansion. Strategic decisions are then made regarding how and when to enter the specific markets. Efforts to maximize international economies of scale are evaluated, paying particular attention to production, advertising and branding. * Through efforts with local market expansion, firms promote sales from each country-specific base. New products and services are developed, or existing products and services are tailored to meet the customer demands of each country market. In doing so, firms strive to achieve economies of scope by spreading shared costs across multiple product and service lines. * Global rationalization induces worldwide economies of scale, shifting the trend away from country-centric strategies. This increase in efficiency stimulates a higher quality of R&D, operations, engineering, and even management techniques; synergies are realized by this new organization of operations. * Semi global Marketing Strategy allows for the simultaneous focus of managing multiple strategies in multiple country markets. During this step it is imperative that firms maintain their competitive position and market share in developed markets, while concurrently establishing a presence in divergent emerging markets...
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...Essay: A Summary of Essential Learning Outcomes in BUSN601 - Global Management Perspective JC American Military University Reflection Essay: A Summary of Essential Learning Outcomes in BUSN601 - Global Management Perspective There were a number of learning outcomes for BUSN601: Global Management Perspective. The topics for this course included: * developing Porter’s Five-Forces Model in a global strategy; * assessment and integration of business functions in an organization; * formulation of essential components of the strategic management process; * assessment of target markets and forecasting of the components of the marketing mix; * assessment of the importance of market research in developing a global initiative * Integrate e-business applications into your overall global initiative. * Appraise how employment law constrains choices for the organization * Relate how regulatory law affects an organization's decisions * Identify and incorporate the key elements of contracts. * Assess the influence of different cultural perspectives on global business operations. * Argue the influence of regional trading organizations on business opportunities and constraints In the following I discuss in summary perspective the key takeaways from this course as well as learning objectives I did not meet. Integrate Porter's Five-Forces Model into developing a solid global strategy. Porter’s five forces model of competitive analysis...
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...Elements and Drivers of International Business 1. Globalization of Markets: It refers to the merging of national markets into one huge global marketplace. Now selling internationally is easier due to falling barriers to cross-border trade. A company doesn’t have to be the size of these multinational giants to facilitate and benefit from the globalization of markets. It is important to offer a standard product to the worldwide. But very significant differences still exist between national markets like consumer tastes, preferences, legal regulations, cultural systems. These differences require that marketing strategies in order to match the conditions in a country. To illustrate, Wal-Mart may still need to vary their product from country depending on local tastes and preferences. 2. Globalization of Production: It refers to the sourcing of goods and services from locations around the world to take advantage of national differences in the cost and quality of factors of production. The idea is to compete more effectively offering a product with good quality and low cost. For example, Nike is considerate one of the leading marketers of athletic shoes and apparel on the world. The company has some overseas factories where has achieved a super production with low cost. Unfortunately Nike has been a target of protest and persistent accusations that its products are made in sweatshops with poor working conditions. The company has signalled a commitment to improving working conditions...
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...CHAPTER 1 – Operations and Productivity Learning objectives Define operations management Explain the distinction between goods and services Explain the difference between production and productivity Compute single-factor productivity Compute multifactor productivity Identify the critical variables in enhancing productivity What is operations management? Production – the creation of goods and services Operations Management – activities that relate to the creation of goods and services through the transformation of inputs to outputs Organizing to Produce Goods and Services Marketing – generates the demand, or at least takes the order for a product or service (nothing happens until there is a sale) Production/Operations – creates the product Finance/Accounting – tracks how well the organization is doing, pays the bills, and collects the money Page 5 exhibit The Supply Chain A global network of organizations and activities that supplies a firm with goods and services Members of the supply chain collaborate to achieve customer satisfaction, efficiency and competitive advantage Big rise in global supply chain recently 1st ripple – stopping work at a plant immediately following disaster (skilled labor layoff) 2nd ripple – try to move production to a new area due to long term impact (try to recover skilled workers Reasons to globalize Tangible Reduce costs Improve supply chain Provide better goods and services Intangible Better understand markets Learn to...
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...Reviewing the simulation a number of factors stand out. Gross revenues increased each quarter along with gross profits. Analyzing just that data would presume that Global Business Solutions was doing fine. A product was brought to market and did sell earning the company money and market share. However, a closer look would find my excess capacity costs at upwards of 40% of the operating expenses. This expense cannot be sustained and must be lowered. Also, the cost of carrying unsold inventory of approximately $25,000 must be addressed. Although the company didn’t lose a sale to lack of inventory the cost of carrying inventory far out weighed the potential loss if we didn’t fill a customers order on time. There are many marketing tools that could be incorporated to pacify a customer. In the real world analysis of the budgets and pro-forma performance must be accomplished daily. During this simulation we experienced quarterly data changes unlike the real world where changes occur daily. Due to this fact, any adjustments made were in the rears ultimately costing the company money. Although, the company ended with a substantial cash balance and a small profit, sustainability, is crucial when looking forward at the broader picture. Who, what, where and how should be the rallying cry going forward. In this highly competitive marketplace the company must decide who is it’s ultimate customer, what it wants to be, a big, intermediate or small company and what it wants to produce...
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... | |Different types of business (profit or non-profit) | | |Internal and external business environments |[pic] | |Environment’s elements impact to businesses | | | | | |Learning Objective of Topic 1: | | |After reading this chapter, you should be able to | | |explain type of business appeal to them and reasons | | |explain how businesses are influenced by internal and external environmental elements | | |explain importance of these environment’s elements | | References: • Griffin, Ricky W. and Ronald, J.R., 2010, Business Essential, 8th Ed., New Jersey, Prentice Hall, Inc. • Pride, W.M., Hughes, R.J. and...
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...MGT680-1302D-01 Strategic Management Toolscorp Corporation’s Introduction To The Global Marketplace Strategic Plan Overview David Lomidze American Intercontinental University Dr. Leland Taylor June 17.2013 Abstract This paper will address ToolsCorp Corporation’s attempt to penetrate the global marketplace and broaden the area of the operations and sales. Overall evaluation of the establishment and the environment and Toolscorp Corporation’s long term strategic plan development in early phase and its mission and vision statements will be defined. Toolscorp Corporation’s Introduction To The Global Marketplace Strategic Plan Overview Toolscorp Corporation ToolsCorp Corporation is the well-established organization that builds power tools, lawn mowers, lawn furniture, microwaves, and ranges and located it in Tennessee. All products are manufactured locally and sold through large retailers as Sears, Best Buy, and Wal-Mart. They have some advertisement and although they have a greatly established and very promising business in US and Canada, ToolsCorp is trying to introduce its product into the global marketplace. In case of success Toolscorp will become one of the largest establishment in its field and will overcome its competitors in sales by gaining huge share of the marketplace that gives the Corporation great power of dominating the market. Mission Statement Nine essential components of the mission statement are Customers, Products or Services, Markets...
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...the glue that hold a business together. The OC of a business influence how the firm thinks and reacts to the daily challenges it faces. They can make a business venture successful or cause it to fail if not developed properly. Most companies demonstrate organizational culture (OC) in the way they conduct business, treat employees, customers, and the communities in which they reside. This paper will take a look at Starbuck's organizational culture to identify the possible key elements that aid in the company's success in today's global economy. This paper will evaluate the efficiency of Starbucks management decisions regarding their innovative offerings to customers in a competitive market to obtain their current advantage. Then uncover a key management competency most successful Starbuck managers might have and divulge one way the competency would be good for the organizational culture of the company. Finally, this paper will deliberate Starbucks' capacity to obtain lasting sustainability as a global leader in the coffee industry without the leadership of their CEO, Mr. Howard Shultz. Starbuck's success is due to Starbuck's leadership, headed by CEO Howard Schultz. Schultz's...
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...structure are primary strategic decisions which can make or break an organisation. One important aspect of a good structure is the human element. Organisation structure should be designed so as to encourage employees and increase the morale and job satisfaction of organisation members which will result to overall organisation efficiency. (Mullins, 2006) describes nine basic considerations in the design of organisation structure. The fundamental step is to define organisational objectives to enable further analysis and comparisons of other forms of structure. Clarification of objectives A clear definition of objectives is vital to provide a framework for the design of structure of an organisation. Organisation objectives provide fundamental schemes for division of labour and creation of group units and sub units. Clearly stated aims and objectives will assist in decisions on the strategy and structural dimension to employ to achieve organisational objectives. Task and element functions Certain functions must be performed in order to produce a good or service, from the development of the good or service to finance of resources used in the complete processing. These functions are referred to as the task functions. The results of the task functions must be coordinated to ensure the efficient achievement of total objectives of the organisation. Element functions refer to vital parts of the management process and are supportive of the task functions such as human resources and public...
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...An operations strategy is the structure upon which an organization determines how it arranges and uses its resources in order to maintain acompetitive advantage. It is a formulated framework consisting of two elements. The structural element contains components like location and size of the organization, whereas the infrastructural element focuses more on aspects like product quality control. A successful operations strategy will align and actualize the organization’s business strategy. Sponsored Link Talent Management Strategywww.cornerstoneondemand.com Improve workforce productivity and customer sat. Free Whitepaper Competencies Design an effective operations strategy around competency priorities to focus on how the organization plans to offer its competitive edge in the marketplace and how it distinguishes itself from other organizations that offer similar products or services. Many organizations target one competency from the traditional list of cost, quality, flexibility and service. For example, a quality-driven operations strategy focuses on beating out the competition with its products' durability and reliability. Cost Driven An organization designing a cost driven operations strategy focuses on providing a product more cost-efficient than its rivals. Many cost driven products are commodities such as salt, flour, sugar or even gasoline, which customers usually buy strictly on the basis of price because they perceive little or no difference between brands. Service Driven...
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...minimum legal requirements. (Gehrke, 2008) You hear of labor issues, environmental issues and the one this paper will discuss is government corruption. Many companies allow governments to be corrupt and they are allowed to steal from their own people. Such is the case in Nigeria, so PUR Packets will need to be aware of this dilemma and work closely with the government to make sure all business is legal, economical and ethical. Corporate Social Responsibility and Ethics Corporate Social Responsibility is a form of self regulation, conscious attempts and self efforts undertaken by an organization for enhancement of operations. CSR is usually part of a business model and should be part of the marketing strategy. CSR in its best element promotes public interest encouraging community growth and development, and it eliminates practices that harm that same public interest. It is sometimes referred to as the 3 P’s, people, planet and profit. The last of the three can sometimes cause a company to overlook some ethics. This is also true of some governments and Nigeria is no exception. (Yosuf, 2007) Nigerian Government Corruption. According to the African Union the government of Nigeria steals around $150 million per year from the people....
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