Starbucks Organizational Culture Essay

How Culture Affects Productivity Organizational culture and productivity are closely related. Simply stated, productivity is the art of getting the company”s products and/or services to the customer at the lowest possible cost. But it is more than that – it is related to quality, to customer needs and to labour relations. In other words, productivity and good management are inseparable. Productivity is a result of motivation, and motivation thrives in a good climate.

If management is to transform this fragile good climate into a long-lasting culture for success, it will have to focus on the following seven areas of improvement: 1. Organizational Clarity The degree to which the goals and plans of the organization are clearly perceived by its members rises in proportion to the employees” feelings of involvement in the goal-setting and planning procedures. Fostering this feeling of involvement and direction is more important than presenting lists of objectives and detailed plans.

To promote organizational clarity, involve all members of the organization in the goal-setting and planning process. 2. Decision-Making Structure We tend to forget that the main purpose of structure is to facilitate decision making, not to develop new organizational charts and lines of authority. In some organizations, especially high technology, ambiguity or looseness of structure may be preferable. Make sure that there is a free flow of information for decision making throughout the organization, and that the structure for disseminating that information allows positive outcomes.

Organizational Integration Determine how much cooperation exists among various units of the organization. Do they communicate effectively to help achieve the organization”s objectives. Cut through red tape by forming temporary task forces, made up of people from various disciplines, which sidestep hierarchial structures. 4. Relationship of Management Style to Culture The use of an authoritarian style in a democratic culture is disastrous: resistance is inevitable. Similarly, democratic management in an authoritarian culture leads to the chickens-without-heads syndrome.

People who have worked in an authoritarian climate will have been discouraged from using their own initiative in doing their jobs. They have not felt free to question constraints, and have not sensed that top management will support them if they have made poor decisions. They have not been allowed to develop entrepreneurial traits that enhance innovation and ultimately productivity. Ensure that the management style suits the culture. 5. Organizational Vitality Organizational vitality is measured by the boldness of its goals and its responsiveness to changing conditions.

This requires that employees be allowed to make mistakes. Develop a system that encourages employees to take risks for the betterment of the organization without the threat of punishment and find ways of helping them learn from their mistakes. 6. Compensation The compensation system should reinforce a success orientation without being too positive. If too positive, employees comes to expect ever-increasing rewards. If too negative, employees may retaliate by, for example, working to rule.

Develop a system of compensation that is equitable, competitive and related to long- and short-term performance. 7. Human Resource Development Provide opportunities within the organization for people to develop to their full potential. How does the company deal with obsolescence? Are old or unneeded people fired? Does management give credit to those outgoing people for their career contributions? Or is the prevailing attitude, “what have you do for me lately? ” How honourably the company acts in these situations will do much to determine whether or not it has a culture of success.

Concerning the relationship between culture and productivity, behavioural scientists have identified a number of human characteristics that tend to fly in the face of many currently favoured management practices: People are not rational A? professional mind-watchers have been telling us that human beings are the ultimate study in conflict and paradox. All of us are self-centred, seek praise and recognition, think of ourselves as winners and not losers. We operate as much by gut feelings as we do by logical, rational thinking.

We are creatures of our environment, sensitive and responsive to external rewards and punishment, but we are also strongly motivated by internal pressures. We are looking for meaning in our lives and will make great sacrifices for those employers who will provide us with meaning. At the same time, we need to feel that we are in charge of our own destinies. Employee behaviour is influenced by the organization”s expectations of how employees act. If the company creates rules and regulations to apprehend offending employees, employees will be caught and disciplined.

The cycle repeats and repeats … f a manager believes employees are lazy, his belief is confirmed when an offending employee is caught. Furthermore, if the only way an employee can get recognition is by breaking the rules, then he or she will break the rules because negative recognition is preferable to none at all. Behavioural scientists, such as McGregor and Likert, based their management theories on the belief that man is by nature an experimenter, a thrill-seeker and an inventor. They indicated that management should provide meaningful work and equitable compensation, that jobs should be whole and exciting work modules.

Given this, the average employee would be happy to contribute, add new ideas and boost productivity. Mind-Set for Improving Corporate Cultures For companies that find themselves in this counter-productive merry-go-round, there is a way out. They can improve their corporate cultures by recognizing that: Corporate culture emanates from the top. It is top management”s responsibility to recruit, train, teach and coach managers so well that they in turn provide desirable role models for the employees in their charge.

In other words, the way these managers behave, the way they lead and the way they think, sets a climate and ultimately a culture for success. Executives, from the top down, must realize that people are unique and that they are frequently irrational and always complex. The organization should establish procedures that take into account the duality in human nature. It should provide both meaningful work and direction, while satisfying in some measure the employees” need to feel independent.

Values and Beliefs Behind Success No matter how much effort goes into improving the above areas, if the combination of capital, creativity and human resource management that comprises the organization”s culture is not success oriented then the outcome will be failure. The overriding cultural values that influence a company”s productivity level include the intention to produce quality products and to provide quality service. Its production practices and its products will reflect creativeness and innovation. Informality will be the preferred communication practice.

The company will appreciate that customers are the reason for its corporate existence, and treat them accordingly. The company will recognize that its people should be treated with the dignity and respect it affords its customers. The culture will not support the notion that workers work and only managers manage. Successful companies have in common the following basic values and beliefs: 1. Generally, the drive to provide a top quality product or service affects virtually every function of these organizations and they hold tenaciously to the belief that it is possible to achieve excellence

They focus on the marketplace and are responsive to the needs of the consumer. 3. Regardless of the “economy of scale” argument that says large companies are more efficient, many of the most successful organizations appreciate that small is good. 4. They accept that work should be intrinsically satisfying, that employees can handle autonomy and that increased efficiency will result, and they act on these beliefs. 5. Their personnel policies are established with the realization that the only true discipline is self-discipline.

Guidelines are established to provide regular and positive feedback, praise and coaching by the supervisors. 6. Employees see that the organization values the individual and his or her integrity, and that discipline provides a framework. It give employees confidence to experiment, their confidence stemming from knowing what really counts in the organization. 7. The successful organization thrives on internal competition, a value quite consistent with our North American way of life. We compete for school grades, we believe in the free enterprise system.

8. These companies are often characterized by open, frequent and intense communications, a feeling of informality and a go-with-the-flow attitude. Internal politics are a minor consideration. Starbucks Organizational Culture The Starbucks Corporation presents a strong appeal for potential employees with a strong organizational culture. This culture maintains values that reach every corner of its organization; and reaches outside its walls to the communities as well. Reviewing some of Starbucks’ cultural characteristics reveals how successful and appealing this cultural model can be.

Starbucks appeal Many of the business concepts and the attributes of the Starbucks’ organizational culture are very appealing. First, Starbucks has become a well known global entity. This has been achieved by a well recognized product that relies on its quality and unique marketing strategies. Customers can always be expected to be confronted with enthusiastic employees, happy to serve, and focused on the needs presented by their customers. Employees are well trained and have a vast amount of knowledge about all the products offered by their company.

The effort that is placed on the quality of their product can be seen by the average consumer. They strive to provide an excellent product and, as proven by their tremendous success, few patrons leave the store with any dissatisfaction. It is apparent that the values and mission statements projected by the company are having great success in creating a strong cultural behavior. Values Many of the values held by the Starbucks Corporation business model are shared by consumers and adapted by closely watching organizations.

One value that stands out for the company is in community support. According to Starbucks Corporation (2008), they support many community organizations such as Conservation International, The Earthwatch Institute, Save the Children, Mercy Corps, the African Wildlife Foundation, and Planet Green. Values such as this have set standards and send messages that profitable companies have a responsibility to the communities that support their organization and to the needs impacting the environment and the world surrounding them.

As well, the Starbucks organization list in its guiding principles the importance of embracing diversity, providing a positive work environment through respect and dignity, and a commitment to satisfying all customers all the time (Starbucks Corporation). Embodiment of cultural characteristics Starbucks continues to satisfy employment needs and provide excellent customer service. In part, this success can be attributed to the cultural characteristic of innovation and risk taking. At Starbucks, employees are empowered and encouraged to think outside the box.

Hawks, Kembell, Kembell, Olsen, and Perry (2002), tell us that Starbucks encourages and rewards employees for innovative ideas and encourages employees to sway from drink standards to meet the specific request of the consumer. This leads to the characteristic of attention to detail. Because the company promotes the enthusiastic development and satisfaction of its customers, employees are expected to remain focused on the needs of the customer. In this business, this may mean the development and use of special listening skills and multitasking abilities.

Employees, focused on the ever-changing ingredient orders that very from customer to customer, show how valuable this characteristic is to the corporation. The Starbucks Corporation also exhibits the cultural characteristics of people orientation and team orientation. The company shows employees how important they are to their organization through the decisions they make that impact different members. Some of this can be displayed through the offering of health benefits to parttime employees (Hawks et al. , 2002). Cultural strength Starbucks maintains a very strong spiritual culture.

Marques (2008), states that “Starbucks’ performance toward suppliers, communities, employees and customers gives rise to the awareness that Starbucks is one of those corporations that does not explicitly use the term spirituality at work for their actions, nonetheless live it to the fullest. ” Starbucks shows this spiritual culture in their promotion of fair trade, environmental contributions, workplace diversity, and its self acclaimed statement of employee enlightened self-interest. The bonds that Starbucks’ forms with its partners, employees, and community are evident when one simply opens the front door of the establishment.

Starbucks maintains a strong appeal for a great place to work by asserting its strengths in its acquired cultural characteristics, values, and spiritual culture. Many other organizations are adapting these structural concepts after seeing the success of this organization. Starbucks can maintain this strong organizational culture with continuing dedication to its employees and customers. Starbucks has achieved success in corporate culture and has set the bar high. For many organizations this should be a walk-up call to catch up.

The corporation uses developed guiding principles and mission statements to guide in the decision making process and these also appear publicly on their website. These models play a vital role in the decision making process. Starbucks has been very successful in its ability to circumvent perceptive errors through the use of relational models. However, even with the use of relational models, errors and bias can still play a role in the decision making process, but the organization has adapted a level of accountability through this process to minimize the impact of errors and bias.

Communication, culture, and decision making, represent only a small part of the concepts that makeup organizational theory and behavior. A corporation that applies the concepts of organizational theory and behavior can determine the success of any organization. As we can see, Starbucks has concentrated on the successful application of these three areas of organizational behavior. With this successful application, Starbucks proudly promotes and shares the models that make them successful to anyone who cares to investigate. As a result, Starbucks continues to be a successful corporation.