Introduction
Starbucks is one of the leading providers of quality coffee in the world. They also provide customers with neighborhood coffee shops where they can hang out, relax, and spend time with their loved ones (Starbucks 2016).
As great a company as Starbucks is, there are areas in its operations that can be further improved. Two of these are in terms of their green initiatives and in the supply chain management where bottlenecks can lead to insufficient or excessive inventories.
Green Operations
As established in previous assignments, companies are increasingly pressured to adapt “green” practices in order to improve their relationships with customers and to gain the customers’ trust. Although Starbucks has started some “green” practices such as offering free coffee to customers who will bring their own mugs on Earth Day and by serving coffee in mugs rather than in paper cups for dine-in customers, Starbucks can certainly do more in order to further broaden its sustainability efforts.
One strategy for achieving this is by encouraging or mandating their suppliers to adapt green or sustainable practices in their operations. As asserted by Wong et al. (2012), the success of a company’s green operations is contingent on the environmental management capability of its suppliers. They also contend that process stewardship is positively associated with performance outcomes and that the environmental management capability of suppliers moderates the relationship between financial performance and process stewardship (Wong et al., 2012). This conforms to the findings of Elgazzar et al. (2012), which suggest that linking the supply chain processes’ performance to the company’s strategic objectives allows companies to obtain a competitive advantage and establish strategies that improve supply chain management through the association of such strategies to the enhancement of the company’s financial performance.
In this regard, some of the strategies suggested by Mutingi (2013) in developing green supply chain management practices include the following: 1. Supply chain collaboration and the development of recycling and remanufacturing systems; 2.) Use of innovations and technologies that are environmental friendly, along with the way they are transferred across the supply chain; 3.) Integration of waste reduction with the operational efficiency alongside the objectives of the supply chain; and 4.) Use of performance standards, which describe the basic environmental requirements across the supply chain (Mutingi, 2013). As indicated by La Forme et al. (2007), the successful management of a business requires companies to work more closely with their supply chain partners, to optimize their relationships, and to integrate and interface their decision-making and information systems so that product activities and flows are synchronized.
Inventory Management
Inventory management is another area of Starbucks’ operations that can be further improved, particularly when dealing with bottlenecks, which can lead to either insufficient or excessive inventory. In this regard, a strategy that may be used to mitigate this risk is to implement a Just in Time inventory management system. This system is a type of inventory management system where products or materials are acquired or produced only when there is demand. However, as asserted by Mazanai (2012), the successful implementation of a Just In Time system requires an established and well crafted infrastructure such as a reliable source of supplies, an electronic information network, and an efficient transport system (Mazanai 2012). This means that the effective management of the supply chain is also important in ensuring the effectiveness of a Just In Time inventory management system.
Conclusion
As discussed in this paper, many of Starbucks’ areas of operation can be improved by also improving the management of their supply chain. In particular, its implementation of green operations will largely depend on the environmental management capability of its suppliers while the success of a Just In Time system implementation to address its bottlenecks can be ensured by having reliable suppliers.
References
Elgazzar, N. S. T., Hubbard, N. J. and Leach, D. Z. Linking supply chain processes’ performance to a company’s financial strategic objectives. European Journal of Operational Research, 223(2012), pp. 276-289.
Mazanai, M., 2012. Impact of just-in-time (JIT) inventory system on efficiency, quality and flexibility among manufacturing sector, small and medium enterprise (SMEs) in South Africa. African Journal of Business Management, 6(17), pp. 5786-5791.
La Forme, A. G., Genoulaz, V. B. and Campagne, J-P., 2007. A framework to analyse collaborative performance. Computers in Industry, 58(2007), pp. 687-697.
Mutingi, M., 2013. Developing green supply chain management strategies: A taxonomic approach. Journal of Industrial Engineering and Management, 6(2), pp. 525-546.
Starbucks, 2016. Starbucks company profile. [online] Available at: <http://www.starbucks.com/about-us/company-information/starbucks-company-profile> [Accessed15 March 2016]
Wong, C. W. Y., Lai, K-H., Shang, K-C., Lu, C-S. and Leung, T.K.P., 2012. Green operations and the moderating role of environmental management capability of suppliers on manufacturing firm performance. International Journal of Production Economics, 140(1), pp. 283-294.
