CM

1. Atal Bihari Vajpayee Indian Institute of Information Technology and Management
CHANGE MANAGEMENT
Company - STARBUCKS
Harshit Yadav-2019IMG-022
Manish Kumar - 2019IMG-034
Nikita Rathore-2019IMG-041
Palak Jain - 2019IMG-043
Parth Lawania - 2019IMG-045
Presented To:
Prof. Manoj Patwardhan
Presented By:

2. Change management is a systematic approach to dealing
with the transition or transformation of an organization's
goals, processes, or technologies.
The purpose of change management is to implement
strategies for effecting change, controlling change, and
helping people to adapt to change.
Change Managment

3. Starbucks is a coffee store company that
originated in 1971 in Seattle.
It is the world's largest coffeehouse chain.
As of February 2023, the company had 36,170
stores in 83 countries.
It is one of the leading organizations in the retail
business and is known for its special coffee brand
and as roaster.
Net revenue of Starbucks reached 26.58 billion
U.S. dollars in 2022.
Introduction

4. Starbucks’ Timeline
Starbucks opens first
store in Seattle’s Pike
Place Market.
1971
Offers full health
benefits to eligible full-
and part-time
employees, including
coverage for domestic
partnerships.
Total stores: 33
1988
Becomes the first
privately owned U.S.
company to offer a
stock option program
that includes part-time
employees.
Opens first licensed
airport store at
Seattle’s Sea-Tac
International Airport.
Total stores: 116
1991 1998
Extends the Starbucks
brand into grocery
channels across the U.S.
Opens in underserved
neighbourhoods.
Launches
Starbucks.com.
Opens stores in:
Malaysia, New Zealand,
Taiwan, Thailand, United
Kingdom.
Total stores: 1,886

5. Starbucks’ Timeline
Expands hiring
commitment to 25,000
service members,
veterans and
military spouses by 2025.
Kevin Johnson becomes
CEO and Howard Schultz
transitions to
executive chairman.
Opens stores in: Jamai
2017 2020
Establishes Starbucks
Coffee Trading
Company (SCTC) in
Lausanne, Switzerland.
Launches Wi-Fi in
stores. Opens stores
in: Germany, Greece,
Indonesia, Mexico,
Oman, Puerto Rico and
Spain.
Total stores: 5,886
2002
Launches the
industry’s first paper
beverage cup
containing post-
consumer
recycled fiber.
Opens stores in: Brazil
and Egypt.
Total stores: 12,440
2006
Announces new sustainability
aspiration to become resource
positive.
Transforms mental health
benefits, including new resources
for U.S. partners.
Introduces strawless lids for iced
beverages in stores in the U.S.
and Canada.
Opens stores in: Dominican
Republic.
Total stores: 32,660

6. Despite growth and success, Starbucks faced
challenges in the late 2000s.
The global financial crisis (2007-2008) led to closure
of underperforming stores.
Rapid expansion led to a loss of focus on the core
business, resulting in a decline in product quality.
Recognizing declining profitability and customer
satisfaction, Starbucks initiated a comprehensive
change management program in response to the
imperative for significant changes.
Need for Change
In response, the company realized the need for change and
embarked on a comprehensive change management program.

7. Streamline operations for cost reduction and
increased efficiency.
Refocus on the core business of selling high-
quality coffee and related products.
Enhance customer service and store
experience to boost satisfaction and loyalty.
Reason for Change

8. Closed underperforming stores and streamlined
operations for cost reduction.
Refocused on core business by introducing new
blends and improving product quality.
Launched a customer feedback program to
understand needs and preferences.
Introduced new store designs and layouts to enhance
the in-store experience.
Invested heavily in employee training to ensure
excellent customer service and maintain product
standards.
Strategies

9. Employee Resistance: Some employees resisted
the changes, requiring efforts to ensure
widespread acceptance and alignment with the
company's new direction.
Balancing Act: Striking a balance between
introducing new products and store designs while
preserving core values and identity posed a
challenge during the change process.
Challenges
Customer Retention and Attraction: The risk of losing existing
customers during the change process necessitated careful
strategies to maintain the current customer base while attracting
new customers.

10. Financial Performance:
Significant improvement in profitability.
Increase in the company's share price.
Product Quality and Innovation:
Enhanced quality of products.
Introduction of new blends and products well-received by customers.
In-Store Experience:
Improvement in the in-store experience.
Positive reception of new store designs and layouts.
Customer Satisfaction and Loyalty:
Increase in customer satisfaction.
Growth in customer loyalty.
Restoration of Starbucks' position as a leading brand in the coffee industry.
Results

11. Financial Performance
Starbucks Stock Price Trends (Source: www.macrotrends.net)

12. Financial Performance
Starbucks Growth Trends (Source: www.nasdaq.com)

13. Starbucks Demographics
Source: Pandey, Rudresh & Ganatra, Varsha & Jamnik, Sonali & Goel, Pragya & Goyal, Priyanshi & Lee, Chian & Mui, Daisy & Kee, Daisy & Mein, Hee & Lim, Xiao & Tan, Shiaw En & Lee, Jen & Zen,. (2021). An Empirical Study on Customer
Satisfaction, Perception, and Brand Image in Starbucks Coffee in India, Asia. International Journal of Tourism and Hospitality in Asia Pasific. 4. 53. 10.32535/ijthap.v4i1.1021.

14. Starbucks Customer Satisfaction Scores
Source: Pandey, Rudresh & Ganatra, Varsha & Jamnik, Sonali & Goel, Pragya & Goyal, Priyanshi & Lee, Chian & Mui, Daisy & Kee, Daisy & Mein, Hee & Lim, Xiao & Tan, Shiaw En & Lee, Jen & Zen,. (2021). An Empirical Study on Customer
Satisfaction, Perception, and Brand Image in Starbucks Coffee in India, Asia. International Journal of Tourism and Hospitality in Asia Pasific. 4. 53. 10.32535/ijthap.v4i1.1021.

15. Strong Leadership:
Clear vision and commitment from Starbucks leadership.
Effective communication of the need for change.
Providing necessary resources and support for successful implementation.
Ensuring everyone understood their roles and providing guidance throughout.
Effective Communication:
Communicating changes to all stakeholders effectively.
Utilizing various communication channels, including town hall meetings, newsletters, and training sessions.
Creating a shared understanding of changes and gaining buy-in.
Building trust and credibility with stakeholders.
Employee Engagement:
Involving employees in planning and implementation.
Providing training and resources for effective change implementation.
Recognizing and rewarding employees embracing changes and delivering excellent customer service.
Creating a culture of ownership, accountability, continuous improvement, and innovation.
Critical Success Factors

16. Critical Success Factors
Customer Focus:
Prioritizing the customer in the change management program.
Listening to customer feedback and making adjustments to products and
services.
Improving the in-store experience for enhanced customer satisfaction.
Building a strong brand and a loyal customer base.
Flexibility:
Being flexible and adaptable during the change process.
Making adjustments to strategies based on feedback from employees and customers.
Recognizing change as an ongoing process and making continuous improvements.
Staying competitive by anticipating and responding to market changes.

17. And as of May 2023, the brand announced
it will begin charging customers an
additional $1 for the "no water"
customization on its line of Refreshers
An Upcharge for No Water
01
Starbucks partnered with Doordash to make
the coffee menu widely available in America
and provide more convience to it’s
customers.
Expanded Delivery Channels
03
As part of the 2023 merchandise, Starbucks
has launched Pride-themed items made
through its Artist Collaboration Program.
Inclusivity & Diversity
05
The company will be introducing a new type of
nugget ice. New toppings after the high
demand of Sweet Cream Cold Foam, Salted
Caramel and Chocolate variations.
New Ice & Upgraded Drink Toppings
02
Upgraded Food
04
In Japan, Singapore, and London, the brand has launched
"Borrow A Cup", where customers can take their drink in a
reusable cup that is designed to be returned to stores.
Company Innovation & Sustainability
Plans
06
6 Changes at Starbucks this year
Starbucks has a few changes planned for this year to improve its food and drinks, streamline its cafes, support its
workers, and expand its loyal fanbase.
The brand has disclosed the possibility of more
plant-based items in the near future, as well as
vegan and vegetarian choices in the form of
bagels and special snack boxes.

18. One Drastic Change
Starbucks will close up to 400 company-operated stores over the next 18 months. It points out that the
company typically closes about 100 stores in the Americas every year, primarily because of lease
expirations and other circumstances.
The company is laying the foundation for a "transformational phase" to introduce a new store format
called "Starbucks Pickup." Starbucks Pickup is tailored to customers who prefer to order ahead and pay
through the Starbucks mobile app for pick-up or those who want their Starbucks delivered to them by
placing an order through Uber Eats.
Starbucks says that even prior to the COVID-19 outbreak, it discovered that about 70 percent of
transactions in U.S. company-operated stores were for "on-the-go" orders. This process of reevaluation
and redesign of the store experience has been underway for two years.
Change:
Reason:

19. THANK YOU!