The strategic designs that are undertaken by organizations help the same in undertaking the proficiency of the functions and thereby enhance the performance of the same. The discussion aims at identifying the core issues that are faced by Starbucks and the manner in which the organization might mitigate the issues. The feasibility of the recommended actions are also undertaken as a part of the research in order to facilitate the smooth implementation of the same as per the applicability in the case.
The issues that are faced by the organization are based on the evolution and modification in the business environment. The changes in the business environment have affected the smooth functioning of the business processes. The section depicts the core competencies that are faced by the organization while operating in the ever- changing global business environment.
Cantor, Morrow and Montabon [10] stated that the flexibility of the management’s operations helps in the smooth functioning of the business in different economies. The key elements of change in the organizational processes are generally based on the flexible policies that are formed by the management that correlates to the business environment. Moreover, Tseng and Lee [7] added that the efficacy of organizational operations is based on the collaborative functioning of the management with the workforce. It will be helping the organization in maintaining the efficacy of the operations in compliance with the regulations and the economic recessions faced by different nations.
Hu et al. [6] stated that product differentiation helps organizations in maintaining a competitive edge in the different markets. The improvements in the product and service offerings of organizations help the same in sustaining in different competitive markets. Adaptability of the organization to the different changes in the market helps in maintaining the efficacy of the same while operating in diverse international markets. Pernot and Roodhooft [4] stated that the strategies that are formed by organizations depends on the competition faced by the same in the international markets. The strategies include the identification of the target market and positioning of the products as per the needs of the customers in order to gain a competitive edge. On the other hand, the differentiation strategy of the organization helps the same in maintaining the uniqueness in the range of products that are delivered by the same while operating in diverse international markets.
Pricing strategies that are undertaken by organizations helps the same in achieving the competitive advantage over the other players in the market. Donaldson, Qiu and Luo [1] stated that pricing the products as per the identification of the financial capabilities and study of demographic situation helps organizations in enhancing their operations in the different markets. Strategic pricing of the products relates to the different costs that are incurred by the organization as per the Porter’s generic model, which emphasized on the costs incurred by the producer. On the other hand, Bowman and Faulkner noted that the customers have nothing to do with the costs that are incurred by the organization during the product development process [3]. Therefore, organizations must take steps to develop policies to reduce the costs that are incurred by the same in order to offer the products at an affordable price to the consumers. Vaccaro [5] stated that the key elements of change in the organizational operations are based on the differentiation of the line of products in order to maintain the uniqueness of the same over the offerings of the competing players.
Advertising is one of the major activities that must be undertaken by organizations in order to make the customers aware of the product and service offerings of the same. Johnson and Snowflake [2] stated that advertising and promotions are the major steps that might be undertaken by organizations in order to establish sound marketing communications, which will be helping the same in developing the products more efficiently. Moreover, Jiang et al. [3] also stated that the enhanced marketing communication helps the organizations in understanding the priorities of the consumers while operating in diverse international markets. The enhanced advertisements of organizations help the same in expanding their scopes in different international markets. It helps organizations in gaining a competitive edge and sustenance in the highly competitive market structures.
The problems that have been faced by Starbucks has occurred due to many reasons which have been depicted below:
The problems that are faced by the company have affected many areas of their functions and operations, the reasons of which have been mentioned above.
To overcome the problems there have to be certain steps that have to be undertaken by the company to regain its position in the market. The steps are as follows:
The recommendations that are provided for the betterment of the company would only be successful if they are logical and feasible. Feasibility is an important factor which plays a great role in the actions on the recommendations. The feasibility of the recommendations would depend on their importance and the expense that the company would have to do for taking the correct actions.
The feasibility of the recommendations would depend solely on the company, however, the recommendations provided in the study are the basic steps that should be taken by the company to ensure their consistent performance and growth in the market in the long run. These recommendations would help Starbucks to overcome the intense competition in the market and therefore, the investment is necessary on their part.
Conclusion:
Hence, it can be concluded that it is important for every company to take certain strategic decision which would help in the enhancement of their performance and additionally their growth. The study has discussed about different core issues that are faced by the coffee brand Starbucks and provided different recommendations to overcome these problems. The different problems that have been highlighted in the study are the ones which have their functionality in the global market. Final recession, intense competition, the high pricing strategy, the absence of proper marketing techniques and the rigorous expansion are the mentioned core problems of Starbucks. The detailed theoretical application of the above mentioned problems are also given along with recommendations to overcome them. The recommendations are to train the staff, focus on the quality of products, to reduce the pricing of the products and develop advertising strategy. The feasibility of the given recommendations have also been analyzed in the study which discusses that the company should invest on developing a plan of action on these based recommendations for the success of their company.
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