Case study 02-1_starbucks_corporation
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Transcript of Case study 02-1_starbucks_corporation
Starbucks CoffeeCan Customers Breastfeed in a Coffee Shop?
A Notre Dame case study produced by research assistants Shannon Rainer, Cameron McHale, and Jenny Bailey under the direction of Professor J. S. O’Rourke,
IV. Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall
Team Members
• Contents– Intro– History– Case Details– Discussion &
Questions– Conclusion
Jeremy PerryCandace L. HurdleKenya Hargrove
Whole, Skim, or Breast milk?• August 8, 2004
– Silver Spring, Maryland Starbucks– “Nurse-in”: Mothers, Fathers, Babies– ~100 protestors (30 mothers)
• The Idea: 1 Month Earlier– Lorig Charkoudian– Breastfed 15 month old daughter
Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall
So, why Starbucks?
Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall
History of Starbucks
• Founded in 1971.• Coffee, tea, and spice store.• Named in honor of the first mate
in Herman Melville’s Moby Dick.
Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall
Howard Schultz• Kitchen appliance salesman
• Hired by Starbucks in 1982
• Trip to Milan in 1983
• Left the company in 1985
• Bought the company in 1987
Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall
Starbucks and Schultz
• IPO in 1992
• 8,337 stores
• 33 countries
• $4.1 billion in revenues
• Available in supermarkets and commercial airliners
Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall
Starbucks’ Culture
• Third Space
• Employee Focus
• Corporate Social Responsibility
http://www.starbucks.com/aboutus/environment.asp
Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall
Starbucks’ Culture
• 6 Principles:– Provide a great work
environment and treat each other with respect and dignity.
– Embrace diversity as an essential component in the way we do business.
http://www.starbucks.com/aboutus/environment.asp
Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall
Starbucks’ Culture
• 6 Principles:– Apply the highest standards
of excellence to the purchasing, roasting and fresh delivery of our coffee.
– Develop enthusiastically satisfied customers all of the time.
http://www.starbucks.com/aboutus/environment.asp
Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall
Starbucks’ Culture
• 6 Principles:– Contribute positively to our
communities and our environment.
– Recognize that profitability is essential to our future success.
http://www.starbucks.com/aboutus/environment.asp
Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall
Who thought to target Starbucks?
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Lorig Charkoudian• Conflict Resolution• Maryland’s Top 100 Women• Accomplishments
– Adjunct professor @ University of Baltimore
– 1995-present: Executive Director and Founder of Community Mediation Program
• Awards– 1999: Unsung Hero Award– 1997: Brick Award & Human Rights
Community Builder Award
Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall
Lorig’s Demands & Response• Breastfeeding policy in all Starbucks
• www.nurseatstarbucks.com – Letters to CEO, Orin C. Smith
“It’s about public acceptance of breastfeeding”
Lorig Charkoudian
Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall
Starbucks Response“Starbucks complies with all applicable state and local laws
regarding breastfeeding.”
“Concerned customers should avert their eyes or move to a different
location within the store.”Audrey Lincoff
Starbucks Spokeswoman
Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall
Breastfeeding Legislation• May 22, 2003: Maryland Governor
Robert L. Ehrlich, Jr. signed legislation regarding public breastfeeding
• Maryland Code Title XX, Subtitle XIIIa) A mother may breast-feed her child in
any public or private location in which the mother and child are authorized to be.
b) A person may not restrict or limit the right of a mother to breast-feed her child.
Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall
Breastfeeding Legislation• 16 states currently have no
legislation• Language
– “Irrespective of whether the nipple of the mother’s breast is uncovered during or incidental to the breastfeeding”
– “conducted in a modest manner”
• New Jersey and Connecticut– Fine or imprisonment for limiting a
mother’s right to breastfeed
• Hawaii and Illinois– Proceedings for limiting a mother’s
right to breastfeed
Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall
Industry Responses• McDonald’s
– No comment
• Burger King– Corporate wide policy– “We want to be a family-friendly
place.”Rob Doughty
Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall
Past Problems• 1995: Jeremy Dorosin• Faulty espresso machine
– Received “loaner”– Purchased wedding gift
• Chain of Complaint– Store manager– Corporate Service Supervisor– District manager
“Too little, too late” Jeremy Dorosin
Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall
In a matter of weeks…• May 5, 1995: Wall Street Journal• 3 radio shows• 3 television program appearances• New York Times article• www.starbucked.com
Timeline: ~6 weeks
Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall
Conflicting Customer Segments“If you look at the clientele during business hours, you’ll find a lot of young mothers with children who come to congregate and talk. If they want to continue to attract
this clientele, they need to change their policies.” Elizabeth Zifcak
“In a place where I am eating and drinking, that is the last thing I
want to see.” Kalen Johnson
Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall
Discussion• Can you identify the business
problem in this case?– Customers were complaining about
public breastfeeding
• What are the critical issues and which of them should be addressed first?– 1st all employees including managers
should be aware of the law.– Letting the public know about breast
feeding laws and let them know that it is allowed.
Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall
Discussion• Who are the principal stakeholders in this
case?– Customers (mothers who breastfeed)
• What actions would you recommend to Starbucks management?– Put a sign up stating the law or breast
feeding, let people know it is aloud and no one can not restrict or limit the rights of a mother to breast feed her child.
• How would you implement and communicate those actions?– Training sessions: educate employees of
laws, and how to handle these types of situations
Questions?
• Should Charkoudian’s group’s demands be taken seriously, or are they just another case of ridiculous requests which can be safely ignored by the company?– Yes they should be taken seriously
because situations like this happen however Charkoudian should not have targeted Starbucks the way she did.
Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall
Discussion cont’d• Is there a reasonable way for
Starbucks to satisfy all customer segments?– Yes. The public should know the law
and govern themselves accordingly. The law states that it is very much legal that mothers can breastfeed in public and if they have a problem they should avert their eyes, relocate to a different part of the restaurant or leave.
Questions?
• Assuming Starbucks adopts an official policy, how can it effectively communicate the policy throughout the company?– Through meetings, training sessions,
and posting the laws wherever employees can see them (employee handbook, lunch areas, etc.)
Copyright © 2010 Pearson Education, Inc. Publishing as Prentice Hall
Questions cont’d• When state laws which affect
store operations change, how can Starbucks communicate the new laws to stores in that state to ensure that all stores are in compliance? – Training sessions, meetings, having
employees sign that they have read and received them.