Question

Leadership & Managing People Case
Starbucks announcement that it will close few stores in Saudi Arabia admission of limits to growth.
The founder Howard Schultz recognized the problem that his own growth strategy had created: “Stores no longer have the soul of the past and reflect a chain of stores vs. the warm feeling of a neighborhood store.” Starbucks tried to add value through innovation, offering wi-fi service, creating and selling its own music. More recently, Starbucks attempted to put the focus back on coffee, revitalizing the quality of its standard beverages. But none of these moves addressed the fundamental problem: Starbucks is a mass brand attempting to command a premium price for an experience that is no longer special.
How will you help company to recover and expand its operation in Saudi Arabia. The Company hired you as CEO of Starbucks coffee in Saudi Arabia

1. Identify and describe the four managerial functions that can be applied in Starbucks business in Saudi Arabia. (200 – 300 words)

2. Explain the different types of planning for the different levels of management in Starbucks in KSA. Include the typical time frame for which each plan is created. (200 – 300 words)

Answer 1

Solution:-

nswer 1

Four Managerial functions that can be applied in Starbucks business in Saudi Arabia:

1.Planning: First, management needs to create a comprehensive action plan aligned to increase the sales and bring in the customers. The most important barrier to them is local competition from neighborhood stoes. They should plan in such a way that their coffee (main product) seems affordable to customers with the same quality and ambience. The major goal should be to attract customers and their loyalty with the same kind of experience that Starbucks is known for. This could be by increasing their stores in every corner, competing with local competitors on prices and feel factor, marketing it based on products & warm feeling, and innovating according to customer's needs.

2. Organizing:
•To increase stores in every corner, Starbucks should go for joint venture with various local neighborhood stores to understand the customer's needs and how they have this warm feelings over there. To have these joint ventures, they should send their expert employees (who have joint venture experiences) to various locations of Saudi Arabia so that they can close these deals and train the hired employees.

•Use all their technological expertise to innovate new products keeping in mind the financial aspect
•Deploy their expertise in this new market to understand the market

3. Leading:
•Train and motivate the employees for this new market and set specific targets for each employee.
•Conduct training sessions regularly to make them understand the exact strategy for the new market so that they are aligned with the corporate strategy.
•Spend time with the employees and understand where exactly are they facing issues, and make them a part of big decisions
4 Controlling:
•Measure the performance based on sales, revenue, total stores opened, and profits
•Measure the employees' performance regularly based on growth criteria in Saudi Arabia and reward performing employees
•Monitor the reasons behind non performing stores
•Measure the innovation index for products and recognise the innovating employees

Answer 2
Planning is to do the ground workwellin advancein order to make the things happen.
The different types of planning for the different levels of Management ibn Starbucks is as :

• Strategic Planning : It involves the top management people in the organization and aimfor achieving the objectives of the organization. In the case of Starbucks, the • • • strategic plan is to expand the operations in Saudi Arabia.
• Tactical Planning : It involves integration of various units and resources of an organization in order to achieve strategic objectives. For Starbucks, the tactical planning would be to organize the raw materials, manpower in order to deliver premium quality services to the customers.
• Operational Planning : It is designed by the lower level management to cover functional aspects of the organization such as human resource,production and finance and it is concerned with day to day operations of the orgnization.For Starbucks,it is producing good quality coffee, and deliver it in a premium way by arranging the requisite funds.
• Contingency Plans: In case of an emergency if the things do not go asper the plan, there is a contingency plan as well to restore the tasks back as per the plans.