Sydney Edmundson
6/6/17
Principles of Organizational Behavior
It may be difficult to believe that a company with 254,000 employees, sales of 21.67 billion dollars, and
32 years of experience (Forbes, 2017) could possibly be “struggling”. However, while the business is
thriving and taking down competitors left and right, Starbucks Co. is struggling with serious staff issues.
How can such a successful company have such high job dissatisfaction amongst its employees? It doesn’t
take much time working with the company to begin to notice some key issues, so throughout my two
years of working for the company I was able to notice a lot. Pairing my education in management and
business with working for a company with key staff issues, I was able to hold a unique perspective and
clearly identify where the problems arose from, as well as identify some possible solutions.
The fallout of recessionary survival strategies, policies to cover the cost of the “College Achievement
Program”, and chain of command issues all attribute to Starbucks job satisfaction issues. Throughout
this paper, I will discuss the 2008 recession and its consequences for Starbucks, the Starbucks College
Achievement Program, and the issues with the current chain of command. I will also recommend
solutions to these errors, and provide some insight into my leadership and conflict style.
The Recession and Its Consequences
The recession of 2008 resulted in a tough financial hit to Starbucks. Between March 2007 and 2008,
Starbucks suffered a 28% decrease in profits. To combat this, Starbucks closed 900 stores between 2008
and 2009 and laid off 6,700 employees from both its retail stores and its corporate office in Seattle.
(Husain, Khan, Mirza, 2014)
Starbucks was forced into “survival mode”, and had to cut costs any way they could to survive. While
Starbucks is nearly recovered from the financial hardship the recession caused, they have yet to identify
a huge staff problem that resulted from the cost cutting that the company had to do in order to stay
afloat. Before the recession, employees enjoyed somewhat of a “care–free” work environment. They
were trained to remake customer beverages as often as they needed to “get it right”, and were taught a
very flexible customer service policy. Starbucks encouraged employees to participate in their “coffee
culture” by participating in coffee tastings with co-workers and even taking the company’s Coffee
Master course to learn more about the roasting of coffee’s and the different types that Starbucks had
available. However, this all changed during the recession. Every dollar mattered, and employees were
re-trained to critically think about each decision they made and to cut costs in any way possible. Coffee
tastings become a low priority, along with the coffee master program. Employees were given strict
guidelines on when to remake a customer beverage. These guidelines resulted in employees facing a
new pressure “not to mess up”, and when they did, they were scolded by employees and managers for
“letting the team down”.
While Starbucks surely did not intend to transform the workplace into a very serious environment where
even the smallest mistake became a large one, their cost cutting policies lead retail stores to that place.
The decrease in coffee tastings and the low priority of the “coffee master” program certainly did not
help to foster a team environment and lead to high tensions amongst teams, and made employees feel
undervalued.
While the company has moved on from the recession, its employees have not. The pressure to “not
mess up” is still very present in its retail stores, and has resulted in employees in a constant “storming”
stage. Team building activities are absent and the lack of personal confidence builders, such as the
Coffee Master program, leads to employees failing to see any value in their work.
There is also a large disconnect between long-term, pre-recession employees and post-recession
employees. Post-recession employees have been trained during a tough time for the company, and
place the highest value on minimalizing waste and cutting costs. Pre-recession employees place the
highest value on coffee culture and customer service. When these groups of employees work together,
there is a clear disconnect. Employees have not been told clearly how to prioritize, and there for each
employee priorities differently. This causes a constant clash between ideals, and pre-recession
employees use seniority to their advantage, pushing out post-recession employees- hurting the
company with high employee turnover.
College Achievement Plan
While Starbucks has pulled itself out of the financial hardship it faced in 2008, the company is still trying
to minimalize costs while continuing to be successful and thrive. In June of 2014, Starbucks announced
that through its College Achievement Plan employees (partners) will receive tuition aid or
reimbursement, depending on their class standing, to finish their bachelor’s degree through Arizona
