12). Companies such as Southwest Airlines, for example, employ a high commitment HRM model that is based on mutual trust between management and line employee to sustain a competitive advantage (Avolio & Bass, 2002)
Companies such as Southwest Airlines, for example, employ a high commitment HRM model that is based on mutual trust between management and line employee to sustain a competitive advantage (Avolio & Bass, 2002). In fact, an increasing number of human resource practitioners have supported high commitment work systems to foster sustainable competitive advantage and reduce unplanned employee turnover (Burke & Cooper 2005)
In reality, many companies fail to realize all of the benefits that can be attained through high commitment HRM due to an inability to align their human resources function with corporate goals, including the need to eliminate waste and add value at every opportunity (Pfeffer 1997). In this regard, a growing number of organizations have sought to reduce their unplanned employee turnover rates in recent years by inculcating a sense of commitment and loyalty on the part of their employees (Droege & Hoobler 2003)
Review and Analysis Starbucks' Corporate History Founded 40 years ago in 1971, Starbucks Coffee Company (hereinafter alternatively "Starbucks" or "the company") began its meteoric growth with just one store in Seattle, Washington. By 1987, Starbucks had grown to 17 stores and by late 1996, the company had more than one thousand outlets across the country (Fine & Cronshaw 1999)
In fact, an increasing number of human resource practitioners have supported high commitment work systems to foster sustainable competitive advantage and reduce unplanned employee turnover (Burke & Cooper 2005). The high commitment approach to human resource management seeks to "elicit a commitment so that behaviour is primarily self-regulated rather than controlled by sanctions and pressures external to the individual and relations within the organization are based on high levels of trust" (Gratton, Hailey, Stiles & Truss 1999, p
Taken together, it is apparent that Starbucks has invested a great deal in the process as well as its partners over the years in ways that are reflective of the high commitment human resource management model discussed further below. Overview of the High Commitment Human Resource Management Model In an increasingly globalized and competitive marketplace, a growing number of organizations have attempted to improve their performance through innovative human resource practices (Pfeffer 1997)
Developing talent is important to it because a typical store manager is aged 21 to 23 and runs a $1 million business. It develops a strong sense of its values through a 2-month immersion process where managers work in-store learning every part of the business" (Sparrow et al
Today, the company has more than 17,000 retail stores located in over 55 countries, including Argentina, Aruba, Australia, Austria, Bahamas, Bahrain, Belgium, Brazil, Bulgaria, Canada, Chile, China, Cyprus, Czech Republic, Denmark, Egypt, El Salvador, England, France, Germany, Greece, Guatemala, Hong Kong/Macau, Hungary, Indonesia, Ireland, Japan, Jordan, Kuwait, Lebanon, Malaysia, Mexico, New Zealand, Netherlands, Northern Ireland, Oman, Peru, Philippines, Poland, Portugal, Qatar, Romania, Russia, Saudi Arabia, Scotland, Singapore, South Korea, Spain, Sweden, Switzerland, Taiwan, Thailand, Turkey, United Arab Emirates, United States and Wales (Starbucks Company Profile 2012). At present, Starbucks has tens of thousands of employees in these far-flung locations, and the company hires 200 new employees each day; in addition, Starbucks routinely opens two or three new stores each day as well (Stopper 2004)
69). Likewise, Starbucks' senior vice president for finance, Matt Sikes, is gay and has been assigned responsibilities for the executive sponsorship of the company's LGBT group in which "he facilitates communication between employees and senior management on a range of issues, including corporate policy, event sponsorship, and even transgender employee rights" (Weinstein 2007, p
Figure 1. Representative Starbucks' Logo Source: Hoots, 2010 Starbucks' Pricing Strategy The company's pricing strategy varies from country to country (Andrews & Chompusri, 2003) but generally speaking, Starbucks uses a sales-oriented pricing strategy based on careful market research and customer analyses to identify pricing levels that the majority of their consumers are willing to pay for their products (Dawson, 2013)
Figure 1. Representative Starbucks' Logo Source: Hoots, 2010 Starbucks' Pricing Strategy The company's pricing strategy varies from country to country (Andrews & Chompusri, 2003) but generally speaking, Starbucks uses a sales-oriented pricing strategy based on careful market research and customer analyses to identify pricing levels that the majority of their consumers are willing to pay for their products (Dawson, 2013)
The company's brands include: Starbucks, Teavana, Tazo, Seattle's Best Coffee, Starbucks VIA, Starbucks Refreshers, Evolution Fresh, La Boulange, and Verismo (Starbucks profile, 2014). Continuing the nautical theme from its name, the company's logo features a mermaid or siren (see Figure 1 below), depending on the source (Hoots, 2010)
Representative Starbucks' Logo Source: Hoots, 2010 Starbucks' Pricing Strategy The company's pricing strategy varies from country to country (Andrews & Chompusri, 2003) but generally speaking, Starbucks uses a sales-oriented pricing strategy based on careful market research and customer analyses to identify pricing levels that the majority of their consumers are willing to pay for their products (Dawson, 2013). Product Life Cycle of Starbucks The company's product life cycle has expanded significantly over the past 45 years to include the wide array of products and brands noted above; however, when the company opened its first store in Seattle's Pike Place Market in 1971, the company only sold packaged roasted coffee beans (Roos, 2013)
For example, new employees have a ceremonial coffee tasting as part of their onboarding experience. This serves to welcome the employee into the company, create bonds with co-workers and foster the sense of being part of something big (Frasch, 2014)
As consumer spending declined, discretionary purchases were hit the hardest, and this had a significant impact on Starbucks. For a time, the company was forced to lower prices and adjust its image in order to attempt to stall sharp sales declines (Adamy, 2009)
These range from unionization to supply chain issues. The price of coffee, for example, is expected to spike as climate change reduces the land available in the world for growing coffee and make coffee pests stronger (Adhiambo, 2011)
245 billion in FY 2011 (MSN Moneycentral, 2011). Starbucks was struggling in the late 00s, and forced to close a number of its stores in the firm's first-ever consolidation (Allison, 2008)
Starbucks is moving into the juice space as well, with its recent purchase Evolution Fresh Juices. Observers believe the company is going to try to do with juice what it did with coffee (Jargon, 2011)
Introduction Starbucks is a quick service food chain that specializes in coffee and snacks. The company is the fifth-largest firm in the industry and the largest with a coffee focus (Oches, 2011)
This audience is growing rapidly -- 4.6% per year, and it sees Starbucks as cool (O'Farrell, 2011)