Starbucks Staff Motivation Strategies

Introduction

Starbucks has served as a milestone in the coffee industry and is a massive organization in terms of people employed and stores owned. At the current time it has revenue of $10.7 billion and owns 16,850 shops in 40 countries. Starbucks is clearly the world’s top coffee retailer, it employs 137,000 employees or “partners” as it likes to call them. Howard Schultz, the CEO of Starbucks, considers that ‘the tip of success in Starbucks is not coffee but employees’. He constantly builds upon the working experience of employees, providing chances of promotion, and treating workers as working partners is their way to operate sustainability. He firmly believes that the spirit of Starbucks is employees and feels honored about the value of Starbucks employees. Many theorists believe that “it is necessary to have a perfect education and training policy for better performance in a company” (Michelli, 2006). Despite serving in many countries, Starbucks has a similar organizational structure; as a result, it does not take into account the cross cultural determinants. It has been criticized for its approach; also because, employees of some countries like UK are not as satisfied as employees from Poland and Germany, thus Starbucks must make use of cross-cultural determinants in order to improve its management methords. One of the most proficient theory, the Hofstede theory states that the motivational factors of every country are different and thus must be looked into before a company, such as Starbucks sets its motivational methods. Along with Hoftsede it talks about Management and Motivation in reference to the Grid/Group Theory by Douglas, which strives to classify different cultures in relation to being hierarchist, individualist, egalitarian and fatalist. It also talks about the ‘Cultural Theory’ and ‘Organizational Theory’ in relation to Starbucks. This research attempts to access these theories in reference to Starbucks, and its motivational methods across nations. It looks at a comparison between the way Starbucks company treats or must treat its employees across UK, Poland and Germany.

Brief Overview

The Starbucks Company is a vast and well constructed multi-national, which serves in 40 countries. It has to keep in mind various cross-cultural determinant while bringing in its motivational schemes. However, it has been criticized for not taking into account, cross-cultural determinants when building its management cultural across countries. It is often assessed, that the employees of countries like UK, seem to be less motivated than employees from Poland and Germany. This paper talks about all possible schemes in relation to motivational theories, that can be adopted by Starbucks,chiefly the Hofstede theory. The factors of this theory are highly relevant and can be implemented in various ways to improve performance.

The first factor, Power distance can be defined as “the extent to which the less powerful members of institutions and organizations within a country expect and accept that power is distributed unequally” (Hofstede 1991, p. 28). UK and Germany, are ranked as a low power distance society, where the relationship between bosses and subordinated is of interdependence, treating each worker equally and calling them ‘partners’. There, the managers of Starbucks are likely to place a greater importance on labors’ rights as compared to managers in Poland, which ranks as a high power distance country. However, in Poland there is a hierarchical social system, thus, it is said that their ‘ideal boss is a benevolent autocrat’.

Another factor of the Hofstede theory is Masculinity, the dominant values in society being material success versus femininity, caring for others and the quality of life. UK, Poland and Germany, are Masculine societies, driven by competition, achievement and financial success. In these countries, people’s performance is highly valued and people ‘live in order to work’. Starbucks too, beliefs in monetary based appraisals, it spends $300 million, on their employees’ welfare, much more than ‘they do on coffee beans’. Starbucks even gave its UK staff shares worth around ?4 million in their employee share scheme ‘Bean Stock’, followed by a Christmas cash bonus to staff worth ?1.5 million.

Uncertainty Avoidance, is another of Hofstede’s theories, it classifies countries into being high in Uncertainty Avoidance; having strict rules and resistance to changes like Germany and Poland and low in Uncertainty Avoidance; having fewer rules and being welcome to changes like UK. This is an important factor to look into a country when bringing in new innovations, and the planning of how the change has to be implemented. Managers of UK can bring in new ideas easily and with more enthusiasm while managers in Germany and Poland have to bring in changes subtely because people resist from breaking orthodox norms uneasy. Starbucks went through many changes when it merged with Giornale, it was welcoming to his employees’ involvement and included them in every change, by 1987, and employees at Starbucks had begun buying into the changes.

The theory includes a comparison between countries which have more, individualism everyone is expected to look after themselves and their immediate family against collectivism, and cultures in which people are bound into strong and cohesive groups. UK, Germany and Poland, are individualistic societies, where the route to happiness is through individual accomplishment. Here the company, in order to motivate its employees has to come up with schemes to provide them and their families’ advantages. The culture in Starbucks is of mutual advantage, thus workers usually do a fruitful job but all these factors must be kept in mind. Understanding all the cross-cultural determinants including these is crucial for a company which serves such a wide range of cultures; their observation along with development on these lines, must all be looked into, in order to bring out the best results.

Another theory is the Cultural Theory’ which talks about the importance of culture, stating that is is too ‘important to be left undefined and unrefined, and analysts need a deeper awareness of the anthropological and sociological frameworks’ when refining their management attitudes. It outlines the effect on culture in relation to common objectives, employee motivation and loyalty. Setting of roles, leadership, innovation, setting incentives, tolerance and accountability. The setting of the corporate cultural is extremely subjective of the countries cultural as a whole.

The Grid/Group theory is another theory based on cultural determinants, created by Mary Douglas, in 1996. It strives to study cultural relativism, which can be increased through a classification system taking into account ‘moral system, worldviews and ideologies’. This classification is built into two axes, based on individualism versus collectivism, including isolate/fatalist, hierarchist, individualist and sectarian groups. Each type is based on different classifications, power paradigms, moral values and individuality. In this paper, it is used to analyze, the classification of different cultures, such as UK, Germany and Poland into these categories, observing where their general workers fall, taking into account their employee, culture, market and forms of hierarchy.

The paper also talks about Organizational Culture Theory which is based on performance, ‘organization effectiveness, employee commitment, employee satisfaction, culture type, culture strength and culture congruence’. This theory is talked about in relation to Poland, Germany and UK; assessing them based on all these assesses their management and motivational factors. Even though Starbucks operates in different countries, its organization culture is often the same. This can be a harmful strategy, as due to differing cultural determinants, the company must change its strategies relatively. If this is not done, the motivation of employees can be lowered and the management can fail to do its job. Thus, this paper talks about all these theories and the possibilities that they provide to Starbucks, in modifying its strategies based on varying cross-cultural determinants.

Objective

This paper is set to analyze and evaluate the cross cultural determinants of Poland, UK and Germany, in order to find out the best ways to motivate the employees of those countries. It attempts to Find out the cross cultural determinants of these societies and the way the employees of these countries are treated.

Methodology

The Prime methodology used will be questionnaires that will be filled out by Starbucks employees across these countries. The questionnaire will be based on the Organizational Energy Questionnaire from ‘fully charged’ written by Heike Bruch, which is an instrument to measure a company’s energy state. The questions will include if the employees like what they do, do not have much drive feel relaxed in their job, feel angry in their job, feel enthusiastic in their jobs, have no desire to make something happen, speculate about the real intentions of management, have real care about company’s fate, are efficient in conducting work, behave in destructive manner, go out of their way to make company succeed and if they feel discouraged in their jobs. All these questions will convey about the general state of employees and their will be a separate questionnaire to observe the importance of cross-cultural determinants.

References

Heike Bruch and Bernd Vogel (2011). Fully Charged. United States of America: Harvard Business School Publishing.

HOFSTEDE THEORY- Poland, (2011) [online]. [Accessed 2012]. Available from:

<http://geert-hofstede.com/poland.html>.

Penny Bassett (2004). CHINESE AND AUSTRALIAN STUDENTS’ CULTURAL PERCEPTIONS: A COMPARATIVE STUDY, Victoria University.

Jim Boyer (2009). Understanding Hofstede’s Theory to Motivate Cross Cultural Employees. Business Insider [online]. (2011) [Accessed 6 May 2012]. Available from: <http://www.businessinsider.com/15-facts-about-starbucks-that-will-blow-your-mind-2011-3#at-300-million-starbucks-spends-more-on-healthcare-insurance-for-its-employees-than-on-coffee-beans-12>

Nicholson, N (1998) Encyclopedic Dictionary of Organizational Behavior Blackwell, pp 215

Hoovers [online]. [Accessed 2012]. Available from: <http://www.hoovers.com/company/Starbucks_Corporation/rhkchi-1.html>.

Starbucks Coffee [online]. [Accessed 2012]. Available from: <http://www.starbucks.com/>.

V S RAMA RAO (2009). The Hofstede Studies [online]. [Accessed 2012]. Available from: <http://www.citeman.com/5113-the-hofstede-studies.html>.

Cultural Dimensions Theory [online]. (2010) [Accessed 2012]. Available from: <http://www.valuebasedmanagement.net/methods_hofstede.html>.

Zoe Wood (2010). Starbucks’ staff set to get free shares in incentive scheme. 19 December 2010. Starbucks [online]. [Accessed 2012]. Available from: <http://www.guardian.co.uk/business/2010/dec/19/starbucks-uk-staff-free-shares-incentive-share>.

Employee Benefits [online]. (2011) [Accessed 2012]. Available from: <http://www.employeebenefits.co.uk/item/12128/pg_dtl_art_news/272/pg_ftr_art>.

Projects [online]. (2011) [Accessed 2012]. Available from:

< http://projects.chass.utoronto.ca/semiotics/cyber/douglas3.pdf >.

York Universit y [online]. (2011) [Accessed 2012]. Available from: < http://www.fsc.yorku.ca/york/istheory/wiki/index.php/Organizational_culture_theory >.