Starbucks blue ocean strategy

The first part presents key concepts of blue ocean strategy, including Value Innovation — the simultaneous pursuit of differentiation and low cost — and key analytical tools and frameworks such as the strategy canvas and the four actions framework. The four actions framework aids in eliminating the trade-off between differentiation and low cost within a company. The four actions framework consists of the following:

Starbucks blue ocean strategy

As well as a banker, an entrepreneur, a farmer, every leader has his own customers: If your leadership is high in quality, people in your company would be willing to buy it; pro-activity and the commitment of employees would be encouraged, with evident benefits for the whole company.

But what if your leadership is low in quality? Employees do not want to buy it anymore. They become non-customers, and, even more dangerous, they disengage. They designed a variety of tools, largely applicable to any company with the ambitious aim to unleash oceans of untapped talent and employee potential to ultimately improve the profitability.

Jim Donald and Howard Schultz.

Maram Alkhayyal Blog: Starbucks "blue ocean" strategy

At the end, you should be able to answer a simple question: Today, Starbucks has more than 24, retail stores located in 70 countries around the world. He believed that one of the ways to have better understanding about business conditions was staying close to the frontliners.

Thus, he used to visit Starbucks stores frequently. He also increased internal communication with employees by quickly replying to e-mails and returning calls. Moreover, he showed trust in his team members by empowering those who were close to the business to make decisions.

This led to the introduction of an additional level of management which resulted in more bureaucracy, which, in turn, led to limited engagement and increased communication barrier between each management level. Stuck by the responsibilities, Donald struggled to visit the shops, reply to e-mails and have a close relationship with the employees.

The Verismo coffee machine also affected coffee taste and the Starbucks experience, as it eliminated the interaction between baristas and the customers.

The focus on store expansion led Jim Donald to overshadow the core business of Starbucks. In fact, Starbucks does not sell coffee; it sells a customer experience made of aroma, taste and baristas. During his tenure all this was going to be lost. The financial performance testified the negative trend of the company.

Moreover, infor the first time in Starbucks history, the customer traffic dropped, while the company raised prices to offset rising dairy and labour costs. An important decision was required. How would you have addressed these challenges? And how did Starbucks react to the difficulties?

Our next post shall answer these exciting questions. To read this article, or to check out our other blogs on related topics, go to http: Chan Kim and Renee Mauborgne here.BLUE OCEAN STRATEGY STARBUCKS The Blue Ocean Strategy consists of recognizing or making an uncontested market space to fulfill by providing products or services that consumers do not know they need or want until it is introduced to the market.

Starbucks, ever since it was established, created a new demand on the coffee market and unlocked a different expectation of the product%(6). Starbucks Blue Ocean Strategy. Blue Ocean Strategy Book Review By Sah Rizal bin Salleh The Authors wrote this book in such a unique way and tremendous, a direct challenge and oppose of the well-known “Red Ocean Strategy”.

To make it clear and justifying my true insight about this book. Coffee Break With Blue Ocean Leadership: The Starbucks Case (Part 1) 10 Aug, innovation and leadership and one of the few organizations selected to be a certified member of the Global Blue Ocean Strategy Community of Practice by the Blue Ocean Strategy-Initiative Centre (BOSIC) UK.

Starbucks blue ocean strategy

In this regard, 'blue ocean strategy' has been one of the much acclaimed tactical moves adopted by diversified companies to gain a competitive advantage over peers.

Aug 08,  · Blue Ocean Strategy (BOS) is the simultaneous pursuit of differentiation and low-cost to create new market space. Blue Ocean Strategy seeks to make the competition irrelevant by creating a leap in value for both the company and its buyers.

CASE STUDY: STARBUCKS KATHLEEN LEE 3 This new strategy has inspired some optimistic feedback. Morningstar investment research firm has increased estimate of Starbucks shares from $4 a share to $24 after the statement of revamp-.

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