Beruflich Dokumente
Kultur Dokumente
BUSI3323: 1310
Section: 201
Course project
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Human Resource Management 2012
Executive summary
This project paper discusses several issues related to Starbucks strategic
management and human resource functions. Human resource functions such as
recruitment and selection, training and development, safety and health,
compensation, and labor relationships were explained in more depth in the second
part of the project. A decision such as outsourcing was taken place as well as growth
strategy and how outsourcing HR function supports the expansion plan. Starbucks
criteria of rewarding and benefits system were explained further as part of the
strategic management. Starbucks success of reporting the lowest turnover rate
reflect how effective the human resource department in applying the organization
strategy. Having a great sounded reputation in the market impacts the pool of
employees and corresponding affect the human resource decisions. The strategy of
managing the challenges as pressures, increasing costs, and retaining employees is
the key role for human resource and considered significant part of their routine
functions. Making effective decisions rely on applying the organization’s strategy
successfully. The high quality performance of Starbucks Company reflects the
effectiveness of human resource function. Additionally increasing the number of
stores around the world is a result of successful decisions.
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Human Resource Management 2012
Table of Contents
EXECUTIVE SUMMARY .................................................................................................................................. 2
PART I ................................................................................................................................................................. 4
INTRODUCTION ................................................................................................................................................................. 4
LITERATURE REVIEW ................................................................................................................................................... 5
CONCLUSION .................................................................................................................................................................. 7
PART II ............................................................................................................................................................... 8
STARBUCKS HR FUNCTIONS .................................................................................................................................... 8
STARBUCKS HR STRATEGIC MANAGEMENT .................................................................................................... 10
CONCLUSION ............................................................................................................................................................... 11
REFERENCES LIST ....................................................................................................................................12
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Human Resource Management 2012
Part I
Introduction
Having a cup of coffee in the early morning is a habit for most of people. The
story of Starbucks started from 1971 when three coffee lovers thought of opening a
coffee shop at Seattle. The store grew slowly at the end of its first decade 1981 and
then expanded significantly across the world until it becomes the most rapid growing
company. The expansion process is not as easy as it seems on contrast it is a
complicated procedure and needs effective decisions. Human resource department
is the one who is responsible for such decisions. Correspondingly challenges arise
and the human resource strategy supposed to be positive and flexible in its response
to changes in order to be successful. An analyst from IBS Center for Management
Research organization, (2005) stated that: “in the light of its ambitious expansion
program, Starbucks' generous human resource policies made sound strategic sense,
as they kept the turnover low and provided a ready pool of experienced employees
to support expansion.” This project will discuss how strategic human resource
management resolves Starbucks expansion challenges.
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Human Resource Management 2012
Literature review
Krishnan, (2011) suggested that in today’s fast changing business environment
and technology developments, organizations are looking for human resource
department that will give them the needed competitive advantage to stay ahead of
their competitors. One of the biggest problems that face human resource department
is the administrative role and sometimes lack of strategies that are needed to survive
in the competitive world of business. Understanding and supporting the
organizational strategy would be the key for human resource department to resolve
the arising problems and reduce the costs of unneeded tasks. Involving in tasks that
are not related directly to the core business would influence the performance
negatively. Therefore, one of the options for eliminating such expenses is
outsourcing.
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Human Resource Management 2012
Bradley & Hargis, (2011) discussed in their article about human resource
management functions and how it affects the organization strategy of success.
Human resource represents the design, development, and implantation of the people
management that affects how well the organization is performing in the business.
Human resource has five main functions, which are recruitment and selection,
training and development, compensations, relationships between employees.
Human resource strategy play a substantial role in targeting talented employees as
well as hiring qualified individuals, keeps motivating employees by initiatives and
rewards, ensuring safety environment, developing training programs to improve the
workers’ skills. Starbucks invested considerably in training employees and was well
known for committing to their employees.
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Human Resource Management 2012
and stock prices. People can taste the creativity of Starbucks’s products through the
variety of drinks and beverages they are offering.
Conclusion
In conclusion, Starbucks strategy of expansion revealed how successful
human resource management they have. Getting over the challenges effectively
reflect the positive performance of its human resource department. Studies show
how organization could be professional in planning and dealing with obstacles as
well as embracing the values of the firm and never delusion its culture while
developing to a higher level. Understanding the functions of human resource and
recognize its importance is essential to the business. Being successful means
moving to a higher level without giving up a single advantage and that is implied to
Starbucks Company. Giving the priority to the customer satisfaction and employees
contentment is the key for success.
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Part II
Starbucks HR functions
Human resource department is vital to any organization and as what
Howard Schultz, owner of Starbucks, said: “human resources are the most important
asset for the organization it must be managed to be in tune with the organization
goals to have the competitive advantage over its competitors.” Recruitment and
selection is one of human resources functions that Starbucks must strategically
manage to ensure positive outcome. According to Bratton and Gold, (2007) defined:
“Recruitment is the process of generating a pool of capable people to apply for
employment to an organization”. While selection was defined as using specific
instrument to choose from the pool of applicants, individuals who fit with legal
requirements, management goal and would be successful in the job. Starbucks must
determine certain characteristics and skills such as friendliness, commitment to
provide excellent services to customers, attention to details and specific
qualifications to carry out their role in Starbuck’s fast paced environment. To ensure
selecting the right employees Starbucks conduct interviews and psychological
testing. It has its advantages and disadvantages, therefore organization such as
Starbucks perform multiple approaches for qualification and requirement.
Forth function is health and safety, comes from the idea that employees
who work in safe environment and enjoy good health are more likely to be productive
and yield long-term benefits to organization. Safety involves protecting employees
from injuries caused by work-related accidents. Health refers to employees' freedom
from illness and their general physical and mental well being as defined by DeNisi &
Griffin, (2008). Some people think that since Starbucks is a shop that only deals with
selling beverages, sandwiches, and desserts it is a safe environment for employees,
it is not because Starbucks operates in dangerous cities that may get robbed,
dealing with hot beverages can increase the possibility of getting permanent burns.
Fifth function is employees and labor relations, which refers to the relationship
between the company and law created to protect the workforce. Most organizations
are required by law to recognize a union and bargain with it in good faith, if the firm’s
employees want the union to represent them. Most organizations including
Starbucks prefer to work in environment free from unions but since 2008 the
employees of Starbucks formed union demanding increased pay and raises because
of company’s profits at 2008 that worth’s 1.7 billion. (You Sigma, 2008)
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Human Resource Management 2012
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Human Resource Management 2012
Conclusion
The process of making a cup of coffee is not as easy as it seems. It’s a
complex process blended with strategy, culture, and management. Planning to make
a global expansion must be managed strategically in order to be successful and
ended with desired results. Human resource department plays an important role in
the organization starting with recruiting and selecting the qualified individuals and
ending by managing relationships among employees and organization. We
concluded that some of the decisions might not work for the sake of the
organizations goals as what happened when Starbucks outsourced the HR functions
at 2007 and then withdraw it after several months. Such a decision should be made
strategically with a great attention to the details. Recognizing individual’s
achievement and rewarding them will benefits the organization in many aspects. One
of these benefits is gaining valuable reputation among competitors. Starbucks
human resource department manifest a considerable attention to each one of its
functions to support its goals and missions.
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References list
Armstrong, M. (2009) A Handbook of Human Resource Management Practice (11th
Bradley, D., Hargis, M., (2011). Strategic human resource management in small and
Bratton, J. & Gold (2007). Work and organizational behavior. 2nd ed. Basingstoke:
Palgrave Macmillan.
Brown, D., Lakhani, B., Malmi, T., Stephen, T., (2008). Strategic human resource
Forstor, J. (2008). Starbucks workers make demands. Red Orbit. Retrieved from
http://www.redorbit.com/news/business/1488969/starbucks_workers_make_demans/
IBS Center for Management Research Organization. (2005). Starbucks’ human resource
Krishnan, S.; Singh, M., (2011). Strategic human resource management: a three-stage
process model and its influencing factors. South Asian Journal of Management,
18(1), 60-82
Heinemann, London.
Naomi, W. (1998). How Starbucks impassion workers to drive growth. Workforce, 77(8), 60
Starbucks outsource its HR functions. (2007). American Society Training and Development,
61(9), 17-17
http://www.starbucksunion.org/about
You Sigma. (2008). Starbucks Rewards and Compensation. Retrieved December 20, 2012
From http://yousigma.com/benchmarking/starbucksrewardsandcompensation.html
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