Starbuck Strategic Control and Innovation
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Strategic control can be described as a well coordinated management process aimed at tracking the strategy during the implementation. It detects any potential problem areas, and makes required adjustments. It therefore becomes necessary to have an effective tracking system to analyze the progress of the strategy implementation, and make the necessary adjustments for the implementation to get back in track.
There are four types of strategic control. Premise control is meant to check detect and make assessment that the premise is still valid taking into consideration the environmental and industry factors. The monitoring of the premise in this case would be to assess if the coffee shops are in locations that serve customers as well as the distance of the processing industry from the suppliers who are the coffee farmers (Tuck School of Business at Dartmouth, 2002).
Strategic surveillance is designed to check and monitor the effects of those events, inside and outside the organization that might affect the implementation. Special alert control is to monitor and assess the reconsideration of the company’s strategy as a result of an unexpected event that may require the organization to reassess the current strategic situation. It requires a crisis team and must have a contingency plan. Starbuck received negative publicity that originated from a conflict with Global Exchange on the fair trade policy. This is an external influence which had an effect on the implementation. A crisis team was formed to come up with a strategy to get the original strategic control back in truck.
Implementation control is designed to check and monitor any changes in the strategy after considering the outcome of the incremental actions on the overall strategy. It is done through monitoring of strategic thrusts and milestone reviews. After the negative publicity with Global Exchange it was recommended that Starbuck management should come up with an implementation control that suggested a change in sourcing the coffee beans so that to allow and accommodate the fair trade policy.
Operational control is concerned with ensuring that daily actions are in line with the company’s objectives. The operational control implemented was to ensure that Starbuck maintained offering the best services to its customers and to maximize on the shareholders profit. A strategy control was to be implemented to achieve this goal
Innovation and Entrepreneurship
According to Pearce & Robinson, (2008) invention of processes, new services or products are promoted by innovation initiatives which the company implements. Innovation has become a mantra, innovate or die (Hamel, Harvard Business Review). Through innovative strategies, the management should invent new ways to improve both the product and its services to customers, in order to add value to its products and remain competitive. Starbuck should start its innovation process by inventing new ways of processing its coffee. A survey should be taken to record the unmet desires of the customer as well as study the competition.
Starbuck should apply both process innovation and product innovation. In satisfying the customer, the expected results will be increased profitability (yield improvement), higher sales and hence shareholders satisfaction. For Starbuck to remain competitive and the leading coffee supplier there is a need to apply the kaizen rule by introducing a process that is always trying to improve the company’s products and processes (Tuck School of Business at Dartmouth, 2002). Incremental innovation should be applied, where simple changes in the existing product are introduced. The Starbuck management should keep up with their entrepreneurial application where the process involves everyone from the CEO to the marketing managers. They should keep using the process of identifying a need and continuous improvement to keep the competition away. Moreover, the adoption of technology in their operation is chisel cutting edge strategy which not only make them efficient but also penetrate and develop new markets.
To support these innovations and to keep up with the entrepreneurial success the shareholders have been the main financial resources for the Company since 1992 when it went public.
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