Starbucks Stakeholder Analysis
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Over the past four decades, Starbucks has become the undisputed leader when it comes to the retail, coffee business. With being the leader in a multinational industry, Starbucks understands that it has to manage and maintain its relationships with all its stakeholders in order to continue its reign on coffee. In the most generic form of stakeholder groups, Starbucks has an effect on its Employees, Customers, Community, Suppliers, Shareholders, Government, and Competitors. These are standard stakeholders of almost every business that operates in the United States or overseas. To narrow it done to a more definitive idea of what Starbucks has an impact on, each generic group has subgroups or specific stakeholders associated to it. WHO ARE THE FIRM’S STAKEHOLDERS?
Specific employee stakeholders can be the typical Starbucks employees, such as the green apron wearing baristas and the general managers of each franchise. The several types of barista employees that work at Starbucks vary from older to younger employees, male to female employees, and even majority to minority group employees. However, some people may overlook the coffee bean farmers that hand pick the coffee cherries. Specific customer stakeholders can be as common as the regular consumer that gets his or her cup of coffee before each work day. It can also be the global markets around the world that each Starbucks has operated a franchise in.
The community itself can be separated into more specific categories that each has a stake in Starbucks’ operations. The standard community can be the residents that live near a Starbucks coffee shop or residents that travel just to purchase goods at that particular coffee shop. The environment as a whole is part of the community, stakeholders group. The environment where the coffee is produced and how Starbucks affects the citizens of that country is part of the community aspect. All the public programs, like Youth Leadership or LeadersUp, in which Starbucks partakes in is its part to help the community.
Just like every other stakeholder that affects or is affected by Starbucks’s presence, suppliers are vital to the business supply chain that Starbucks has administered in order to achieve smooth operations throughout the whole company. Specific suppliers are as simple as the supplier or farmer that supplies the coffee bean that Starbucks uses in its world famous cup of coffee. Other suppliers are the suppliers that manufacturer the cup with the company’s logo on it that people have grown to love. Anything that the company does not make itself can easily be shipped to them through suppliers from all over the world.
Shareholders, in the general sense, are simply individuals or organizations that possess their own shares of stock in Starbucks. Shareholders collectively own parts of Starbucks and ultimately have the right to make decisions that affect how Starbucks operates. Franchisees of the coffee company are a more specific group in the shareholder aspect of stakeholders.
Franchisees handle the everyday operations at the local level of Starbucks and have a major effect on how certain Starbucks are perceived by the community it serves. Government has several levels that Starbucks must comply to in order to continue its success as the top tier of the coffee industry. It must follow regulations and laws set by federal, state, and local level of government. Laws such as environmental laws set by the Environmental Protection Agency (EPA) and building code laws are enforced by both the federal and state government in regards to proper safety measures. Labor laws include minimum wage, the child labor laws, and worker protection procedures enforced by the Occupational Safety and Health Administration (OHSA). Government is a huge contributor on how Starbucks goes about its everyday operations.
Competitors arrive in many different varieties when it comes to the fast food and coffee industry. Competitors can be as direct as the family owned coffee shop down the street or the Dunkin Donuts Corporation a few blocks away from the store. Competitors can even come from overseas corporations trying to cash in on the United States market that are located at the typical grocery store. In the Fortune 500 Company framework, McDonalds, Burger King, Dunkin Donuts, and Panera Bread are Starbucks’ main competition that it is constantly battling for fast food revenue through actual buildings or internet based transactions. WHAT IS THE STAKEHOLDER’S STAKE?
Starbucks pays a fair amount of their attention on how it affects one of their primary stakeholders, the community. Starbucks fully comprehends that being a Fortune 500 company is accompanied with the enjoyment of being able to assist and improve the community it operates in. This partnership has an important relationship between what the community has claimed and how Starbucks will accommodate those claims. The community has legitimate expectations for Starbucks to up hold its obligation to sustainable development that will enable future generations to experience all the useful resources Earth has to offer.
There is only one planet for everyone to live on, so the environment is a legitimate stake in Starbucks. Communities believe they are entitled to the community expansion projects that Starbucks has been developing to help communities acquire their full potential, as well as the full economic potential that comes with having a Starbucks nearby. WHAT OPPORTUNITIES AND CHALLENGS DO STAKEHOLDERS PRESENT?
With being the largest, coffee company in the world, Starbucks has several opportunities and challenges that lesser companies do not have the freedom to encounter when it comes to their community stakeholder. One opportunity that arises is that Starbucks has the opportunity to improve the community it operates in by establishing fund-raising programs. One challenge that Starbucks is confronted with is constantly trying to please the community with its products, while also figuring out a way to keep the Earth intake for the future. Environment needs corporations to figure out ways to develop reusable energy or else it will no longer be of use for the near generation of communities. WHAT RESPONSIBILITIES DOES THE FIRM HAVE TOWARDS STAKEHOLDER?
Starbucks has several responsibilities regarding the immediate community, as well as the global community that is the environment. It has a philanthropic responsibility; this entails being a good corporate citizen and giving back to the community through programs that has welcomed Starbucks to its domain. Starbucks also has an ethical responsibility to its global community regarding how it continues the sustainable development of the environment in order to satisfy the current and future stakeholder’s stakes. These responsibilities are hopefully satisfied through the enacted strategies and actions taken by Starbucks. STRATEGIES/ACTIONS THE FIRM TAKES TO ADDRESS STAKEHOLDER?
Starbucks has established programs and strategies in order to fulfill the company’s responsibilities to the community. Starbucks has understood that they need to continuously develop offensive solutions through their community programs or efforts. In 2013, Starbucks announced an initiative plan to create employment opportunities for the disengaged youth. This helps represents the accommodation aspect of actions when dealing with stakeholders of this size. Blair Taylor, the Chief Community Officer of Starbucks, stated in the 2013 Global Responsibility Report, “We have awarded $1 million for the advancement of a nonprofit corporation called LeadersUp. This nonprofit organization will bring community resources to help supply job and skills training to the young people of the community.” (2) For Starbucks to have an officer whose main job is the commitment to the community shows that it has fully embraced its philanthropic responsibilities.
The immediate community is undoubtedly vital for Starbucks and its ever-growing industry, but without the sustainable environment Starbucks would have nothing to deliver to the community. Starbucks is a frontrunner in the green movement for better methods to produce and dispose of products. In 2013, the company increased reusable energy voucher purchases over their 2012 levels, which equals to about a little over half of the electricity used in their coffee 6
shops worldwide. (Starbucks Global Responsibility Report 2013 14) The EPA has named Starbucks among the top ten purchasers of renewable energy in America (14). The proactive environmental strategies illustrate Starbucks’ dedication to its ethical responsibility to the community as a whole.
Starbucks has shown that even a billion dollar company can develop a combination of life and environment programs that ultimately helps out several stakeholders at the same time, besides the typical shareholder. At Starbucks, the choices and actions they have enacted reflect upon their ultimate mission and core values. For Starbucks to be where it is today, it took the combined visions of all the participates to create a value-oriented corportation. In the end, Starbucks is committed to the quality of the product and guided by its exceptional moral standards.
Starbucks Coffee Company. Starbucks Global Responsibility Report Goal and Progress
2013. Seattle, WA: Starbucks, 2014. Web. 19 Sept. 2014