The Ongoing Story of Starbucks Turn Around:
2014 Leadership Change
The Ongoing Story of Starbucks Turn Around:
2014 Leadership Change
Introduction
In 2014 Starbucks announced major organizational changes starting a new leadership structure as part of its ongoing turn around focus from 2008. The new leadership restructure intended providing leverage in its operations and assets as well as gaining maximum benefit from the consumer, retail, digital, and mobile shifts currently underway in the global marketplace. Review of the past success of Starbucks’ organizational leadership change in 2008 provides the underpinnings of the direction of this next major change. The past success and the focus of the new changes remains attributed to an ethical based socially focused organizational culture (Starbucks.com, 2014).
In the following academic research and critical evaluation of Starbucks’ managing organizational change in its leadership operational process the discussion focuses on the management criteria of this massive undertaking through synthesizing and applying an array of conceptual tools applicable in how this organizational change directs the behavior of its leadership – all attributed to its company culture. The intention of the following discussion is to demonstrate a subjective critical awareness of the process of change in an organization by using the Starbucks Company as a case study example. In preparing the following considerations of the Starbucks’ proactive management applications in line with an organizational change of this magnitude Starbucks initiated it requires synthesizing the links between knowledge management, knowledge tracking, and knowledge migration in organizational change management.
This includes Starbucks’ example as a 21st century growing trend in global business practices showing the shift from the influence of pre-modern industrial to postmodern organizational theory harboring the perspective of a societal culture as task-oriented to one more people oriented. This aligns to the fact Starbucks represents caring for the external stakeholder representative in its customers. Customers remain among Starbucks’ core stakeholders – a wiser consumer in general and, according to Ferrell, Fraeedrich, and Ferrell embracing the value of a capitalist economic system (2011). This consumer knowhow reflects Starbucks understanding and dedication to managing any organizational change through the focus of its company culture and the fair treatment of its customers. The transformation of its leadership beginning in 2014 means continued emphasis on Starbucks’ commitment to its social responsibility as fundamental to its stakeholders as applied to gaining new leverage in its operations and assets as well as gaining maximum benefit from the consumer, retail, digital, and mobile shifts currently underway in the global marketplace.
This scholastic exercise intends offering explanation of the Starbucks’ most current leadership company change management style. This includes how fundamentally this is an ongoing process achieved through the organizational culture frameworks determining such a successful transition takes place. In addition, the following addresses the management components of assessment applied to the organizational change process as well as the application of successful management measures among the changes to the leadership activity in assuring the continued success of this global organization. Sections of the following look at factors involved in managing organizational transformation as exemplified with the Starbucks case study as a successful turnaround company.
Postmodern Organizational Theory
Assumptions related to postmodern organizational theory as applied to Starbucks as a case study in managing organizational change needs clarified. This is because organizational change affects both internal and external stakeholders. Any assumption about the ‘correct’ management of the organizational change model must consider management behaviors according to its organizational culture such as that of Starbucks considering its internal stakeholders (employees) and external stakeholders (the consumer and the community where it does business) as fundamental to long term sustainability and profits as explained by Hatch and Cunliffe (2013). Further as outlined by Boje and Dennehy societal cultural shifts as in the postmodern era taking place as in accordance with the shrinking global community in the post-modern era does indeed influence such assumptions and expectations linked to empowering both the employees as stakeholders and the organization paying back the community it exists (1994).
Starbucks’ management of organizational leadership change historically agrees with the postmodern theory and application of it in terms of the 2014 leadership organizational change. It projects the same type of direction as the CEO change in 2008 with the new leadership of Schulz’ transparency policies in managing the changes in the organization already in place (Starbucks.com, 2014). This adheres to the postmodern management of organizational change theory because Starbucks’ continues reflecting a people-centered service business represented in the way the organization shows its value on its human capital internally and externally as explained above. This aligns with its organizational culture in management style connected to its ethical practices revealing the Starbucks Company continued ability influencing behavior of other organizations, individuals, and the communities it exists with its transparent ethical business practices based on its leadership examples (Barbera, 2014).
The Turnaround Goes On
As proven with the turnaround of the Starbucks’ organization starting in 2008 with the leadership of the new CEO Howard Schultz at that time, this same leadership now looks at Starbucks keeping its global edge as a consumer centered product and service business. This new leadership change intends keeping Starbucks ahead of the competition taking the business lead by focusing on resting the responsibility of change on and through its new leadership direction initiated in 2014. Innovation extended in 2008 with the new organizational changes initiated by the direct of CEO Schultz intends continuing this impetus with the new Starbucks’ leadership changes. Managing this organizational change connects to how the purpose of the organizational hierarchy shift also looks at continuing at all levels in promoting an environment of change and not one of compliance (Starbucks.com, 2014).
Managing this new change in Starbucks’ organizational hierarchy requires ongoing communication throughout the organizational development and further growth goals. This adheres to the company culture values in quality and effective leadership directing its 150,000 member workforce. Effective management of any organizational new leadership restructure but as exemplified by the Starbucks’ case study, maximizes its intentions providing leverage in its operations and assets as well as gaining maximum benefit from the consumer, retail, digital, and mobile shifts currently underway in the global marketplace. Managing organizational changes tuned to these realities therefore, as in the case of Starbucks looks at strategies aligned to existing structures. This is part of the organizational implicit factors including Starbucks organizational culture reflecting its collective values, ethics, and morals all member linked to every stakeholder the organization influences including its stockholders, customers, workforce, suppliers, and communities it provides its business and in return it takes social responsibility (Starbucks.com, 2014; Schein, 2004; Sims, 2003).
Further, to this change in Starbucks’ leadership proves the most recent significant factor in Starbucks ongoing intention of keeping its fair share of the market as a global business. Managing this major Starbucks leadership change looks at transforming its weakest point and building increased credibility among all its stakeholders as the underpinning and principle factor involved in influencing continued organizational growth through this renewed leadership focus. In the management aspect of this organizational transformation key principles apply primary to clarification of the intention of the changes. This emerges as part of the Schultz policy of transparency in Starbucks announcing it new leadership restructure intends providing leverage in its operations and assets as well as gaining maximum benefit from the consumer, retail, digital, and mobile shifts currently underway in the global marketplace (Cummings and Worley 2005; Jick and Peiperl 2003).
The transparency management style set by Schultz with his leadership as CEO of Starbucks in 2008 continues providing transparency for all stakeholders during organizational change a winning methodology. In managing organizational changes adhering to a policy of open communication with timely identification and immediately addressing issues through leadership practicing inclusionary methods connected to the stakeholders makes Starbucks a poster child for success applications of this management style (Cummings and Worley 2005; Jick and Peiperl 2003).
Accordingly the use of its management best practices in handling organizational changes shows how Starbucks remains successful in doing so in order to ensure continuous changes in its organization translating as developing opportunities for growth. The Schultz managing organizational change methodology in 2008 set the momentum that now exists as fundamental to how Starbucks’ leadership handles change and how it applies it to doing business changes in 2014. Consequently as outlined by Schultz’s announcement in 2014 of the new leadership changes he also made it clear the organizational management of these changes meant both creating and maintaining the necessary stabilizing base of operation for the continued improvement of its operational practices as a continuing learning process (Starbucks.com, 2014).
The process underpinning managing organizational change in this leadership turnaround shows a fundamental characteristics of Starbucks’ organizational culture supporting continuity in promoting the involvement of its stakeholders, particularly its employees as most affected by organizational changes taking place. Therefore, aligned to this ongoing process of managing change shows an adherence to the set norms Starbucks’ leadership exhibits in both socialization and communication with the employees. This again, reflects the organizational framework of moral and ethical beliefs adhering to it company cultural values where these organizational changes relies on managing them by fostering a collective stakeholder view of the company in its transparent promotion of the facilitation of the proposed changes (Cummings and Worley 2005; Jick and Peiperl 2003).
Understanding the management of change in the Starbucks organization requires further examination of its transparency policies in communication. Cummings and Worley explain this as managing change by the leadership talking about causal factors prompting the changes as well as the expectations of the desired outcomes related to the organizational change. Management of the change means staying abreast of immediate cause and effect arising from the changes connected to employees as resulting from literally the high energy within the organization caused by such changes (2005).
This type of cognitive management of organizational change assures even more than normal communication takes place with employees in allaying the anticipated stress the changes incur. It is understandable that lingering fears among employees means managing change address this with positive dialogue creating positive outcomes during this time (Cummings and Worley, 2005). This particularly works well according to Ostroff, Kinicki, and Muhammad (2013, p. 644) with an, "(Organizational) culture (Existing as the) property of the collective reflecting deeper phenomena based on symbolic meanings and shared meaning about core values, beliefs, and underlying ideologies and assumptions.” These are the characteristics that spur the Starbucks organization in managing its company changes and keeping its employees abreast of the causal factors for change, the expectations of their response to the change, and open communication about any concerns.
Further, this type of management of organizational change requires both capital as well time investment by using a business framed continuity. Starbucks continually proves its leadership works managing change with such a concrete methodology with control of clearly defined as well as operationally organized lines of company authority, in its communication, and management of these processes. The foundation behind this directly connects to either an existing or a created organizational culture clearly defined with ethical and moral underpinnings led by the management hierarchical standards of communication, transparency, control, professional development opportunities, reward systems connected to productivity motivation aligned to organization growth and development goals as explained according to Elliott, Swartz, and Herbane (2002).
PESTEL Analysis
Managing organizational change and applying the PESTEL (political, economic, social, technological, environmental, and legal) model analysis for Starbucks’ aptly connects as a post-modern morally and ethically based company culture. Starbucks’ leadership in managing company changes continually shows it cares about its stakeholders as already described above. Starbucks’ leadership changes continue showing how it politically looks at the structure of globalization from the business, legal, as well as economic factors in how it conducts itself morally and legally in other countries as a business. Considering the leadership changes and the management of this organizational revamp and the economic aspects of this model shows Starbucks, even in times of organizational changes provides its loyal and new customers more value for their dollar (Starbucks.com, 2015)..
The social section as applying managing change again, assures the expectation of the ambiance of the Starbucks coffee house feature in its locations continues providing the consumer what it wants in the Starbucks venues in sustaining work patterns. Managing change shows Starbucks’ never slows down in its R and D teams improving products and service delivery connected to the technological characteristic of the PESTEL model. Legal aspects and managing change looks to Starbucks considering all factors of regulations as well as policies according to its industry standing as a caffeine production business. The managing of organizational change and continuing its commitment to addressing environmental issues means it stays abreast of decreasing pollution in its business practices through its service and production practices (Starbucks.com, 2014; Starbucks.com, 2015).
Outcomes and Indicators
As a case study of managing organizational change assessing Starbucks’ outcomes and indicators according to Gilley and Maycunich (2000, p. 305) occurs in three stages, “ (They are) preparation, acceptance, and commitment. The horizontal axis of the commitment to change model reflects the length of time an employee has been exposed to change, whereas the vertical axis displays the degrees of support for change.” For managing the 2014 change in leadership affecting the organization operations, development, and focus on growth shows these three indicators connecting to Starbucks’ managerial strategies specific to motivating its employees’. This motivation meant assuring the employees the changes had little effect for them carrying on with every aspect of new products, safety, confidence and trust in the leadership during this transitional period according to experts Cummings and Worley (2005). Doing so means managing the changes continues its transparent saturation of employees expected behavior by management according to the Starbucks’ organizational culture as a collective value base among its stakeholders about the changes according to Cameron and Quinn (2011).
Future Trends
. Managing organizational change continually effects all stakeholders collectively from a national and international perspective. While Starbucks has no history of takeovers, mergers, as well as the other typical global business realities as related to the ever changing world economy connected to the ripple effect again, the Starbucks track record since 2008 having a strong leadership with Schultz in control provides a probable assumption the future of his leadership in the organizational managerial hierarchy should continue proving effective for development and growth for the organization no matter the types of changes occurring and effective outcomes of managing those changes..
Starbucks has a reputation for sustainability of its core workforce and herein is another reason for management during change proving successful as connected to having well trained employees satisfied with the personal and professional opportunities as provided by the strength of the ethical and moral company culture it practices. Changes in technology for more efficiency, environmental commitments, and expectations of management of change aligned to quality control among the workforce at Starbucks also takes consideration for future trends. As a proven track record of efficient management of control during organizational changes Starbucks’ leadership has shown and assumedly will continue to show that changes occurring as connected to technological advances should emerge as more networking operatives in carrying out both the internal and external organizational processes or previously described above.
Clearly, from a management control of organizational change this need for interconnectedness remains a constant at all times and continues increasing globally for all its business expansion worldwide for Starbucks. Management controlling the changes in Starbucks should continue finding the process challenging while the ongoing creation of business opportunities it creates including the Internet proves a means for marketing ideas as well as collaboration with others in the industry.
Summary/Conclusion
The above research, analysis, and discourse achieved its intention to demonstrate a subjective critical awareness of the process of change in an organization by using the Starbucks Company as a case study example as posited in the introduction. The preparation of the above document successfully considered how proactive management applications in line with the Starbucks recent 2014 organizational change in revamping its leadership proved an organizational change of marked magnitude as initiated by Starbucks’ new leadership restructure intended providing leverage in its operations and assets as well as gaining maximum benefit from the consumer, retail, digital, and mobile shifts currently underway in the global marketplace. In doing so the above information successfully synthesized the links between knowledge management, knowledge tracking, and knowledge migration in organizational change management.
This scholastic exercise intention in offering explanations of the Starbucks’ most current leadership company change included how this fundamentally remained a process achieved through the ethical and moral Starbucks’ organizational culture having value in both its internal and external stakeholders. In doing so the above discourse expressed how such a successful transition took place predominantly based on the critical organizational leadership change that took place in 2008 with the CEO position going to the innovative leadership of Schultz. The recent 2014 leadership change led by Schultz provided its own pragmatic implications of him applying leadership management of this organizational change with the same kind of focus for transparency as a pivotal component discussed in the above assessment. Starbucks’ management of organizational change as discussed above provided the successful application of proven leadership measures during such a critical transformation assuring the continued success of this global organization.
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