RUMELT MODEL
Q11: EVALUATE THE BUSINESS/GROWTH STRATEGIES OF STARBUCKS IN RELATION TO THE FOUR C0MPONENTS OF RUMELT’S MODEL
A11:
RUMELT SUGGESTED THAT A COMPANY’S STRATEGIES SHOULD BE EVALUATED FOM 4 PERSPECTIVES.
EXTERNAL CONSISTENCY OR ‘CONSONANCE’ REFERS TO THE WAY IN WHICH A BUSINESS RELATES TO ITS EXTERNAL ENVIRONMENT. IT MUST BE WELL ADAPTED TO ITS ENVIRONMENT & CAPABLE OF SURVIVING AND GROWING WITHIN THIS ENVIRONMENT.
THE GENERIC BUSINESS OF STARBUCKS TO SERVE HIGH-QUALITY COFFEE & PRODUCTS AT ACCESSIBLE LOCATIONS & PROVIDED IN AN ENVIRONMENT FOR SHARING THE COFFEE-DRINKING EXPERIENCE APPEARS TO BE WELL-ADAPTED TO THE MODERN ENVIRONMENT. THE MODERN ENVIRONMENT IN WHICH STARBUCKS OPERATES IS LARGELY INFLUENCED BY SOCIO-DEMOGRAPHIC FACTORS SUCH AS CHANGES IN LIFESTYLE & TASTE, GREATER EMPHASIS ON READY-MADE FOOD, INCREASED CONCERN ABOUT HEALTH & NUTRITION AND A GROWING DEMAND FOR COFFEE CONSUMPTION IN SOME PARTS OF THE WORLD (CHINA & INDIA) . AS SUCH, THE GROWTH STRATEGIES OF PRODUCT & MARKET DEVELOPMENT IS CONSISTENT WITH ITS EXTERNAL ENVIRONMENT. THIS IS CLEARLY EVIDENT FROM THE CASE STUDY; (1) STARBUCKS EMPLOYS OVER 70 PEOPLE TO FOCUS ON PRODUCT INNOVATION IN ORDER TO MEET THE EVER CHANGING CONSUMER DEMAND & PREFERENCE. (2) STARBUCKS ENTERED A 50:50 JOINT VENTURE WITH TATA GLOBAL BEVERAGES TO BEGIN OPENING & OPERATING STARBUCKS STORES THROUGHOUT INDIA.
INTERNAL CONSISTENCY MEANS THAT THE STRATEGY SHOULD NOT CREATE MUTUALLY INCONSISTENT GOALS & POLICIES.
THERE APPEARS TO BE AN ALIGNMENT OF THE COMPANY’S BUSINESS PHILOSOPHIES WITH ITS GROWTH/BUSINESS STRATEGIES. FOR INSTANCE, ONE OF ITS BUSINESS PHILISOPHIES IS TO DIFFENTIATE ITSELF FROM ITS COMPETITORS BY USING TOP-QUALITY, FRESH-ROASTED & WHOLE-BEAN COFFEE. TO ACHIEVE THIS, STARBUCKS USES A HIGHLY SPECIALIZED VALUE CHAIN TO PROVIDE ITS SPECIAL BREW TO CUSTOMERS AROUND THE WORLD AND ALSO ENGAGES ITSELF IN THE ROASTING PROCESS OF THE COFFEE BEAN. AS MENTIONED IN THE CASE STUDY, STARBUCKS HAS 5 ROASTING
A11:
RUMELT SUGGESTED THAT A COMPANY’S STRATEGIES SHOULD BE EVALUATED FOM 4 PERSPECTIVES.
EXTERNAL CONSISTENCY OR ‘CONSONANCE’ REFERS TO THE WAY IN WHICH A BUSINESS RELATES TO ITS EXTERNAL ENVIRONMENT. IT MUST BE WELL ADAPTED TO ITS ENVIRONMENT & CAPABLE OF SURVIVING AND GROWING WITHIN THIS ENVIRONMENT.
THE GENERIC BUSINESS OF STARBUCKS TO SERVE HIGH-QUALITY COFFEE & PRODUCTS AT ACCESSIBLE LOCATIONS & PROVIDED IN AN ENVIRONMENT FOR SHARING THE COFFEE-DRINKING EXPERIENCE APPEARS TO BE WELL-ADAPTED TO THE MODERN ENVIRONMENT. THE MODERN ENVIRONMENT IN WHICH STARBUCKS OPERATES IS LARGELY INFLUENCED BY SOCIO-DEMOGRAPHIC FACTORS SUCH AS CHANGES IN LIFESTYLE & TASTE, GREATER EMPHASIS ON READY-MADE FOOD, INCREASED CONCERN ABOUT HEALTH & NUTRITION AND A GROWING DEMAND FOR COFFEE CONSUMPTION IN SOME PARTS OF THE WORLD (CHINA & INDIA) . AS SUCH, THE GROWTH STRATEGIES OF PRODUCT & MARKET DEVELOPMENT IS CONSISTENT WITH ITS EXTERNAL ENVIRONMENT. THIS IS CLEARLY EVIDENT FROM THE CASE STUDY; (1) STARBUCKS EMPLOYS OVER 70 PEOPLE TO FOCUS ON PRODUCT INNOVATION IN ORDER TO MEET THE EVER CHANGING CONSUMER DEMAND & PREFERENCE. (2) STARBUCKS ENTERED A 50:50 JOINT VENTURE WITH TATA GLOBAL BEVERAGES TO BEGIN OPENING & OPERATING STARBUCKS STORES THROUGHOUT INDIA.
INTERNAL CONSISTENCY MEANS THAT THE STRATEGY SHOULD NOT CREATE MUTUALLY INCONSISTENT GOALS & POLICIES.
THERE APPEARS TO BE AN ALIGNMENT OF THE COMPANY’S BUSINESS PHILOSOPHIES WITH ITS GROWTH/BUSINESS STRATEGIES. FOR INSTANCE, ONE OF ITS BUSINESS PHILISOPHIES IS TO DIFFENTIATE ITSELF FROM ITS COMPETITORS BY USING TOP-QUALITY, FRESH-ROASTED & WHOLE-BEAN COFFEE. TO ACHIEVE THIS, STARBUCKS USES A HIGHLY SPECIALIZED VALUE CHAIN TO PROVIDE ITS SPECIAL BREW TO CUSTOMERS AROUND THE WORLD AND ALSO ENGAGES ITSELF IN THE ROASTING PROCESS OF THE COFFEE BEAN. AS MENTIONED IN THE CASE STUDY, STARBUCKS HAS 5 ROASTING