Organizational Behavior and Communication Paper
Michael Blake Lewis
COM 530
10/29/12
University of Phoenix Online
Bob Kolber
Abstract
This paper will cover the culture of Starbucks and how they are portraying themselves. What the company says its core values are and how well the company is living up to that set of values. This paper will examine how the communications techniques within the company are driving the culture of the organization, and how conflict within the company have affected the culture.
The Starbucks Culture
Three men founded Starbucks in 1971 in Seattle, Washington. The company was originally a whole bean retailer, not making coffee in-store. In 1981, Harold Schultz, joined the company as director of marketing and operations. On a trip to Italy, Schultz discovered that Italian coffee houses had a different feel than those in America. Schultz wanted to bring this philosophy back and so when he returned he spoke with the three owners, who reluctantly agreed to allow him to sale espresso in the back of one of their stores. It didn’t take long for this idea to take off and become successful. Schultz eventually convinced the owners to help him start a separate company, Il Ginorale (Seaford, Culp, & Brooks, 2012). The atmosphere of Il Giornale was very different than that of Starbucks, the baristas wore green aprons as opposed the brown ones worn by the associates at Starbucks. The atmosphere was warm and inviting. Schultz wanted to create a place that people would want to spend their time away from work and home. He called this idea the “Third Place”. In 1987 the original three decided to share their stakes in Starbucks and Schultz already owning three Il Giornale locations bought out the six Starbucks locations and began the process of merging the two together. Schultz decided to use the Starbuck’s name for the newly merged company. He created an atmosphere in all the locations that was comfortable and inviting. Schultz created an atmosphere that contained both the espresso bar and a fine coffee purveyor. Which allowed Starbucks to reach customers of that wanted either service. The ambiance of Starbucks was designed to make customer want to spend time there. The baristas were trained to be able to effectively make the coffee drinks, but also to develop a relationship with the customers, often knowing them by name. The luxury of fine coffee at an affordable price and in such an elegant atmosphere made Starbucks thrive among America’s middle class. The stanch comparison to fast food restaurants of inexpensive products and a hurried pace made America’s perception of Starbucks to be more easily accepted (Seaford, Culp, & Brooks, 2012).
Communication in Business
As Starbucks grew rapidly across the nation the values it so desperately wanted to portray diminished little by little. When the company was smaller it was easier to communicate among the employees the philosophy of creating the “Third Place” environment and the perception of the company was warm and inviting, which helped it to grow across the nation. In an interview Schultz said, “When you look at growth as a strategy, it becomes somewhat seductive, addictive. But growth should not be -- and is not -- a strategy; it's a tactic. The primary lesson I've learned over the years is that growth and success can cover up a lot of mistakes” (McKinsey Quarterly, 2011). As the growth of Starbucks took off Schultz, along with the other directors of the company began to focus on numbers instead of people, which is why the company took a downward turn. The philosophy of creating an atmosphere centered on a place where people could feel comfortable and relaxed took the back burner to growth and profits. The company began to loose its personality. In 2008, Schultz took the company back over as CEO after taking an 8 year sabbatical from the company. One of his first changes was to look directly at each store and how it
