ABOUT STARBUCKS
Starbucks has become a well-recognized name throughout the United States and globally. Originally opening in Seattle, Washington, in 1971, Starbucks has garnered
years of praise for its creativity, innovations, and consistency (Alkhaldi, 2015, p. 4). That's not to say Starbucks does not have its faults. Starbucks has had a tumultuous past few years with COVID-19, the unionization of stores across the United States, and their mobile ordering application, causing confusion and frustrations among baristas and customers (Sorkin & Schultz, 2022).
In an interview led by New York Times Editor at Large Andrew Ross Sorkin on the
YouTube channel New York Times Events, Starbucks SEO, Howard Schultz, reveals he
is taking the formation of unions very personally. Schultz states, "We [Starbucks] are in a battle for the hearts and minds of our people, and we are going to be successful." (Sorkin & Schultz, 2022), but over this past year, sixteen stores have formed unions, and 200 more are filing petitions to accomplish that same goal (Singh, 2022, p.2). Many workers strongly feel Starbucks is moving away from its progressive tendencies, citing the hourly pay wage below the liveable wage and workers feeling under-appreciated as two critical reasons for unionization (Zhang 2022, p. 2).
COVID-19 took the world by surprise, and Starbucks is no exception, but its mobile
ordering technology made the transition easier. Still, Starbucks is not out of the weeds; it has to take many precautions for a safe and sanitary work environment. According to At-a-Glance: Our Response to COVID-19, some steps they've taken to support its employees are self-isolation pay, Starbuck Cup Fund grants, and paid time off to get vaccines (Starbucks, 2022). Yet, with all these programs, employees are frustrated with their employer. Zhang has found that "[Starbucks] has been firing workers for seemingly trivial reasons - including for a sink breaking, allegedly being late, and allegedly recording supervisors without permission (Zhang, 2022, p. 4)". Some point fingers at Schultz and his attempt at a union-busting campaign.
Using the semi-structured interview method, I asked a manager at Starbucks, Morgan (Name changed for privacy), some of their opinions. They stated that unions started being formed in Starbucks because its [Starbucks] people weren't being heard, and management did not pay attention to their concerns about the direction Starbucks was headed (Smith & Doe, 2022).
Another hot-button topic for Starbucks, and has been for years, is sustainability. Like many big corporations, Starbucks' impact on the planet has been criticized. Nevertheless, Starbucks is also in the fight against climate change, saying they will invest $500 million in funds for ten years in a program they hope will be used to support sustainability (Worland, 2018, p. 43).
According to the 2020 Starbucks Environmental Baseline Report, in 2018, Starbucks emitted 16 million tons of greenhouse gases, 1 billion cubic meters of water, and 868-kilo tons of waste were thrown out (Starbucks, 2020, p. 9). To address these issues in its stores, Starbucks has committed to implementing strategies that will allow them to boast about being resource positive; the teams at Starbucks would like to accomplish this by 2030 (Hardie, 2021, p. 3).
In 2017 Kevin Johnson took over as CEO and was met with a lot of success for the business. According to Morgan, under Johnson, Starbucks entered new markets and established around 27,000 stores (Smith & Doe, 2022). Johnson also had to help lead Starbucks through a rough time in China because of the threat Luckin Coffee posed (Nirmalya Kumar et al., 2019, p. 1). The most significant contribution Johnson assisted as CEO was implementing technology to the Starbucks strategy.
Johnson took over the CEO role in 2017, and Starbucks launched its mobile application nationally in 2015 (Cramer, 2022). Starbucks' innovations, especially with mobile order and pay, allowed them to transition to primarily online through COVID-19 easier than other companies because they already had the technology set up (Smith & Doe, 2022). Jonathan Maze shows how Johnson helped grow the mobile ordering app in his article Starbucks Faces Downside of Mobile Ordering. Maze states that "on the earnings call that 1,200 locations now get 20 percent or more of their orders through mobile order and payment. By comparison, only 13 locations were at that level a year ago (Maze, 2017, p.1)." But, as the article's title declares Starbucks mobile ordering app is having some issues that Starbucks has been slow to fix.
Fadye Saud Al Fayad stated in their report, Development of a Viable Mobile Advertising Strategy: Mobile Specific Rather Than a Web-Derived Redesign, that Starbucks agrees that the mobile ordering app is having problems (Al Fayad, 2017, p. 9). Fayad's article quotes, "Starbucks said the popularity of its mobile order-and-pay option…has caused bottlenecks at the areas where people pick up their drinks" (Al Fayad, 2017, p. 23). Fayad wrote their article in 2017, but Starbucks is still having issues in 2022. According to Morgan, the Starbucks manager. Morgan blames the modifications and customization for the slower service and bottlenecks, "teaching our customers our inventory was genius marketing in the sales department, but the lack of talking with partners and how they're affected by this is where the issue lies" (Smith & Doe, 2022).
Starbucks is a strong company well-positioned in the United States Market and a part of many Americans' daily morning routines. Its products range from the food and service industry to physical products sold at grocery stores and markets, making them a well-diversified company. But, to continue growing and keeping its market share, Starbucks must fix the issues with its mobile ordering app, listen to its employees about what they need, and help the stores transition into a mobile order-focused movement to ease customers' frustrations and employees (Smith & Doe, 2022). Starbucks has known there are issues with their mobile ordering technology for five years now and still has not come up with a long-lasting and suitable fix for these issues (Smith & Doe, 2022). It is unlike Starbucks to be slow-moving on such a big issue affecting the company, baristas, and the average consumer. That is not to say the case with mobile orders and pay cannot be fixed, but it is past the time of customer understanding.