Management Essentials CW4 Summative Assessment Brief | BPP

General Assessment Guidance

• Your summative assessment for this module is made up of this coursework submission, which accounts for 100% of the marks.
• Please note that late submissions will not be marked.
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• Do not put your name or contact details anywhere on your submission. You should only put your student registration number (SRN), which will ensure your submission is recognised in the marking process.
• A total of 100 marks is available for this module assessment, and you are required to achieve a minimum of 50% to pass this module.
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• You should include a completed copy of the Assignment Cover sheet. Any submission without this completed Assignment Cover sheet may be considered invalid and not marked.

Management Essentials Assessment Brief

This module is assessed through one graded element worth 100%. You must achieve at least 50% to pass the module. For this assignment, you will produce a Business Consultancy Report based on Starbucks, written in an academic style.

By completing this assessment, you will achieve the following learning outcomes (LOs):  

• LO1 – Critically assess management practice within organisations.
• LO2 – Apply your understanding of management principles concerning key business challenges.
• LO3 – Critically evaluate how management behaviours can promote organisational success.
• LO4 – Defend skills required to be an effective manager in a given business context.

Assessment Scenario  

Acting as a Business Consultant, you are required to produce a business report for the senior management team at Starbucks, by utilising the techniques and concepts you have covered in the module.

Starbucks

Starbucks is an international coffeehouse franchise company headquartered in Seattle, Washington State. It is the world’s largest coffeehouse and coffee retail chain, with over seventeen thousand stores in the United States and more than twenty thousand stores worldwide across more than seventy-five different markets, as of 2023. The company’s origins date to 1971 in Seattle, but the
company saw tremendous expansion beginning in the late 1980s. From 1987, when Howard Schultz became CEO, to the late 2000s, an average of two Starbucks franchises opened daily across the world. The company has publicly stated that it intends to expand its brand and social influence into the realm of pop culture and to rival fast-food giant McDonald’s in level of global reach and
economic power.

The company has also been at the centre of several controversies over the years. These have included lawsuits brought by employees about Starbucks’s tip-sharing policies, the company’s penchant for taking over smaller and less financially powerful coffee shops, Schultz’s policy implemented in 2013 regarding customers bringing guns into stores, and the company’s corporate
decision to begin selling beer and wine. Starbucks leadership has also expressed open support of gay rights and same-sex marriage, which prompted a backlash and a proposed boycott by some socially conservative activist groups.

Overview

Starbucks first opened in 1971 as a local Seattle store that sold coffee beans and coffee-making equipment. This store was started by three entrepreneurs—Gordon Bowker, Jerry Baldwin, and Zev Siegl—who had taken their inspiration from Peet’s Coffee & Tea. Schultz joined the company as its director of retail operations in 1981. Schultz’s vision for Starbucks was for the store to make and sell coffee drinks, rather than merely selling coffee beans and equipment, although the three founders did not share this vision. In 1987, Bowker, Baldwin, and Siegl sold Starbucks to Schultz, who then moved to expand his newly acquired business across Washington and the nation. The
company’s name derives from the famous whale novel Moby-Dick; "Starbuck" is the name of Captain Ahab’s first mate. Starbucks’s iconic logo is a circular green and white image of a crown-wearing mermaid whose long hair covers her bare torso.

As Starbucks grew and spread through American (and global) society, it influenced far more than just coffee consumption. A growing number of sociologists, anthropologists, cultural historians, and other scholars have studied what is sometimes referred to as the Starbucks effect, which pertains to
the sociocultural influences that Starbucks has had on broader social and cultural life. Some of these influences include increasing the general public’s appreciation of coffee; leading the public to develop more refined and discriminatory preferences regarding the taste and quality of various
kinds of coffee; turning coffeehouses into trendy, hip places for younger and older persons alike to "hang out"; and turning coffeehouses into a popular destination to meet new friends and to search for dating partners. Coffee enthusiasts coined the term "second-wave coffee" to describe the
movement, led by Starbucks, which introduced many Americans to darker-roast coffee.

Starbucks's growth across the 1990s and into the twenty-first century was immense, moving it from a local establishment to a national and then international iconic brand. It acquired various other brands and products, including the popular Frappuccino line of beverages, Tazo tea, and Starbucks- brand ice cream. It even explored ventures outside of food and beverage retail, such as music industry collaborations. Like many other businesses, large and small, however, the coffee giant announced the need to close the doors of many stores between 2008 and 2009 following the global economic recession. Beginning in 2008, around six hundred stores were slated for shuttering in the United States, followed by another three hundred planned closings worldwide the next year, resulting in the estimated loss of thousands of jobs for both retail employees and corporate positions. However, the company continued to expand internationally, although at a slower pace, and its fortunes rose again as the general economy revived after 2010. In December 2012, Starbucks announced plans to add at least three thousand new stores worldwide by 2017, signalling a period of renewed growth.

In 2017, longtime company figurehead Schultz stepped down as Starbucks CEO (he had previously stepped down in 2000 to focus on the role of global strategist but resumed the CEO position in 2008) and was replaced by Kevin Johnson. Schultz initially transitioned to serve as the company's executive chair but retired from that role in 2018 to take on the title of chair emeritus. The next few years proved to be a difficult time for the company, as its leadership changed several times to deal with struggling sales and issues with Starbucks' existing business model. In 2022, Johnson retired from his role and was replaced, once again, by Schultz, who became interim CEO and rejoined the company's board of directors. In 2023, Laxman Narasimhan took on the role of CEO, but was quickly replaced the following year by Brian Niccol, former CEO of the Chipotle restaurant chain, as the company continued to struggle financially.

Policies and Controversies

In October 2010, a Starbucks shop in Seattle became the first to sell alcoholic beverages. After initial success at this establishment, the company launched test runs of selling beer and wine at twenty other locations in Atlanta, Chicago, and Los Angeles starting in January 2012. Based on the results of these tests, Starbucks further expanded alcohol sales across the United States over the next several years. This move was designed to attract customers and increase sales during evening hours, when consumption of coffee typically drops off. While the decision drew praise from some, others criticised Starbucks’s decision to serve alcohol by claiming that doing so undermines its "family-friendly" atmosphere. Critics further noted that many recovering alcoholics actually switch to coffee as a way to help overcome their addiction.

As the longtime leader of Starbucks, Howard Schultz openly expressed his and the company's support of equal rights for LGBTQ people. In January 2012, Starbucks and Microsoft (another Washington-based corporation) both declared their support for a bill in the Washington state legislature that legalised same-sex marriage. The previous year, Starbucks and seventy other businesses expressed their disapproval of the Defence of Marriage Act (DOMA), a federal law that officially defined marriage as a union of two members of different sexes. As quoted by CNN, Schultz declared that Starbucks "want[s] to embrace diversity of all kinds." Opponents of same-sex marriage, such as the National Organisation for Marriage, responded in 2012 by creating an online "Dump Starbucks" campaign that encouraged boycotts of Starbucks stores nationwide. By May 2014, this site had collected approximately sixty-eight thousand signatures.

In September 2013, Schultz waded into controversy again by announcing the company’s new policy of not permitting customers to bring guns into Starbucks shops. Several states have laws that allow individuals to openly carry firearms in public places, but as a private establishment, Starbucks has the right to ban customers from bringing guns onto its premises. This decision occurred at a time when gun control had emerged as a highly contentious political issue in the United States following a series of high-profile mass shootings. Schultz noted that before the company’s new policy in September 2013, pro-gun activists and organisations often staged rallies and meetings at Starbucks locations—thereby implying that the company was in support of their political motives. At the same time, other customers expressed uneasiness and discomfort over safety concerns when patronising Starbucks, while other customers openly displayed firearms in their possession. As quoted by USA Today, Schultz commented, "Both sides of the [gun] issue have staged events at Starbucks, so our company has been characterised as both pro- and anti-gun, but we’re neither."

In 2014, the media began criticising Starbucks for its use of scheduling technology that seemed to be better for the business than its employees, especially since many baristas struggle with juggling low incomes, families, and school responsibilities. This technology, which uses algorithms to determine when certain employees are needed to best bolster sales, did not account for the employees' personal lives. At the same time, the company, unlike many other low-wage retailers, offered employee benefits, such as retirement savings plans. In June 2014, Starbucks also made the unprecedented announcement that it would provide free college tuition for both full-time and part-time employees to take online classes at Arizona State University. In addition, the employee manual was altered to include a raise and a change in the dress code, allowing employees to show tattoos for the first time.

Another controversy that made national headlines had to do with the treatment of people of colour at Starbucks locations. In April 2018, two Black men asked to use the bathroom at a Starbucks in Philadelphia, Pennsylvania, and then sat in the store without purchasing anything. A manager called the police, and the two men, who claimed to simply be waiting for a friend, were arrested. The incident was one of several examples of apparent overly harsh reactions against people of colour, and helped ignite significant public debate about racial inequality in everyday situations. As a result of the widespread criticism, Starbucks leadership issued an apology and announced the company would take steps to prevent similar incidents. As part of this plan, in late May 2018, Starbucks temporarily shut down approximately eight thousand of its company-owned stores so that employees could receive mandatory training to avoid bias. While some activists praised the move, others criticised it as a token gesture with little practical effect.

Among the issues encountered by the coffee chain in the 2020s were the effects of the COVID-19 pandemic, the rise in inflation, and resulting economic slowdown, which impacted the food industry worldwide. Critics felt Starbucks leadership was not doing enough to improve stores and innovate new products to try to counteract that slowdown and increase sales. Growing discontent among its employees led the first Starbucks store to vote in favour of unionising in late 2021. Soon, other stores voted to join the Starbucks Workers United union, including one in its home base of Seattle. While Schultz urged workers not to unionise, many employees and observers supported the effort to increase wages and fight for better treatment and more control over their work. Some reported receiving threats from Starbucks leadership as retaliation for unionisation, but Starbucks denied any wrongdoing. By mid-2024, over 425 Starbucks stores across the United States had unionised.

Assessment Task

You are to critically evaluate the current management practices at Starbucks Corporation and recommend changes based on your evaluation that the company must implement to improve its success in the Speciality Coffee Retail Industry.

Task 1 – Management Practices (LO1)

Conduct a comprehensive analysis of Starbucks’s management practices, describing its key aspects and critically assess these management practices.

Support your arguments concerning appropriate academic literature, case study materials and your independent research.

Task 2 – Analysis of Business Challenges (LO2)

Identify significant business challenges faced by Starbucks. Apply relevant management principles to analyse how Starbucks addressed these challenges.

Support your arguments about appropriate academic literature, case study materials and your independent research.

Task 3 – Impact of Management Behaviours on Organisational Performance (LO3)

Critically evaluate the potential impact of Starbucks’s managers’ behaviour on the overall organisation’s performance.

Support your arguments about appropriate academic literature, case study materials and your independent research.

Task 4 – Management competencies development (LO4)

Critically assess different management competencies and defend why these skills are important for current and future managers at Starbucks to improve its success in the Speciality Coffee Retail industry.

Support your arguments about appropriate academic literature, case study materials and your independent research.

Assessment Guidelines:

Introduction

• Define leadership and management, and provide an overview of the purpose of your report, including an indication of the contents.

Task 1 – Management Practices

• Identify Starbucks’s mission, values and management practices.
•  Critically assess whether Starbucks’s mission, values and management practices are all aligned.

Task 2 – Analysis of Business Challenges

• Identify and critically discuss 2 key challenges that Starbucks is encountering in the current environment.
• Analyse Starbucks’s current management competency of Creativity and Innovation using a relevant model/ framework.
• Critically discuss the effectiveness of Starbucks’s current management competency of Creativity and Innovation to enable Starbucks’s management to resolve the challenges identified.
• Analyse Starbucks’s management competency of decision-making using a relevant model/ framework.
• Critically evaluate how effective the management competency of Decision-making is in mitigating the challenges identified.

Task 3 – Impact of Management Behaviours on Organisational Performance

• Analyse the emotional intelligence of Starbucks’s managers using relevant
  model/framework.
• Analyse the positive and negative effects of these behaviours on Starbucks’s performance.
• Give recommendations for cultivating or modifying these management behaviours to enhance Starbucks’s success.

Task 4 – Management competencies development

Select any 2 management competencies from the following and critically assess the selected competencies using relevant models/ frameworks.

• Managing Resilience
• Managing Stakeholder Relationships
• Managing Conflict and Negotiation
• Managing Teams

Propose recommendations for developing and nurturing these skills among current and future managers at Starbucks to improve its success in the Speciality Coffee Retail Industry.

Conclusion

Provide a conclusion that summarises your recommended changes that Starbucks must implement to improve its success in the technology industry.