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This document will assess the project controls and closing operations by Starbucks, one of the world leaders in beverage retail and restaurants. Project control and management is indeed very critical to the restaurant industry and for the efficient implementation of any process.
It involves the use of data gathering and analysis to help predict many parameters that are used in project management such as time and costs, overruns, communications to help effective decision making and keeping the process on track (Projectcontrolsonline, 2012).
The control process begins at the beginning of the project and follows the project life cycle to the end of the project. It helps in initial estimations of time and cost, progress made and then final analysis to understand the achievement of key goals and metrics. An efficient project plan and control process will result in the effective execution and success of any project.
Starbucks strongly believes in corporate social responsibility. As a socially responsible organization, it has initiated many initiatives and programs. Many of these projects are touching and affecting people and communities across the world. The financial crisis of 2008 resulted in a global recession and the company had to fight to survive (Starbucks, 2016).
It resulted in the closure of many stores with job losses but Starbucks continued with its commitment to CSR. Starbucks believes in the concept of Ethical Sourcing in coffee. Across its whole supply chain it ensures that the sourcing helps different communities and also reduces the environmental impact.
In this project, Starbucks has increased investment in loan programs by 100%. The amount stands at $21.3 million in 2015. In 2015, Starbucks announced that 99% of its coffee is being ethically sourced.
Starbucks has put in rigorous mechanisms to ensure that all the coffee that is produced meets with stringent criteria in terms of economics, environment and social behavior. This is indeed a huge project for a chain of with 21,000 outlets in 65 nations. Starbucks has invested around $70 million in this activity to support farmers and sustainability (Horovitz, 2015).
Starbucks has set up Farmer support centers in many parts of the world – Asia, Africa and Latin America to help farmers practice sustainability. In environmental control projects, Starbucks has executed many green building initiatives and have progressed from one LEED® certified store to as many as 800 around the world.
In terms of water conservation projects the company has initiated many controls to measure performance. The company has reduced water use by over 26% in 2008. The farmer support centers provide some of the best agronomists and experts who work with farmers to grow high quality coffee. They are trained in soil management, production and milling to help increase the quality and quantity of coffee (Business Wire, 2013).
These efforts have been successful due to the involvement of youth and communities as well as employees and partners. Starbucks organizes a Global month of Service where more than 1,150 partners undertake projects. Starbucks also measures details of man hours that have been contributed to community and CSR by customers and partners- which totals 3 million hours.
Starbucks sets goals for all its projects and these goals are measurable. In the case of ethical sourcing, it had a clear project goal to ensure commitment and compliance that 100% of its coffee will be ethically sourced by 2015. (Appendix A). Yearly goals are measured and reported. Starbucks also audits the projects through a third party process and the key learning is shared.
For all projects related to Sustainability, Environment or Community, Starbucks has a unique method of control (Appendix B, C). All the data pertaining to the projects are monitored end to end. The monitoring process starts at the beginning of the project with goal setting and identification of key stakeholders. After this the closing is done by an external auditor who is responsible to verify each and every data point and process before arriving at the report. All the data analysis and examination is done as per standards of the American Institute of Certified Public Accountants. All the procedures related to such data collection and analyses are put on paper and described in detail.
Before writing conclusions about the data, many internal controls and activities are tested for effectiveness. Sample cases of data are collected and performance measures are applied to check on accuracy and to validate data collection processes. Employees involved in the collection of data are interviewed and all relevant documents are carefully reviewed – including management structures, corporate policies and so on. Auditors go through all this process to ensure control and compliance of laid-down policies (Starbucks, 2016).
As Starbucks expands its operations globally, it will be increasingly important to expand the scope of project management and control to other countries. The recommendation is to incorporate technology in the measurement, data collection and validation processes. Farmers in emerging markets will also need to be carefully trained as compared to developed markets, to ensure that these projects are closely monitored and measured.
Appendix A
Appendix B
Appendix C
References
Business Wire. (2013). Starbucks Expands $70 Million Ethical Sourcing Program With New
Global Agronomy Center. businesswire.com. Retrieved from http://www.businesswire.com/news/home/20130318006738/en/Starbucks-Expands-70-Million-Ethical-Sourcing-Program.
Horovitz. B. (2015). Starbucks: 99% ethically sourced java. usatoday.com. Retrieved from
http://www.usatoday.com/story/money/2015/04/10/starbucks-fast-food-restaurants-dining-coffee-ethically-sourced/25571937/.
Project Controls Online (2012). Project Controls: What is it and why is it important?
projectcontrolsonline.com. Retrieved from http://www.projectcontrolsonline.com/Home/DefinitionandImportanceofProjectControls.aspx.
Starbucks. (2016). Global Responsibility Report: 2015. starbucks.com. Retrieved from
http://globalassets.starbucks.com/assets/ee8121c1a6554399b554d126228d52ed.pdf.
