Organizational Structure

Organizational Structure

In order for growing corporations to stay organized, it is beneficial for them to use some type of organizational structure. There are two types of structures; Horizontal and Vertical. Starbucks, a small coffee shop that turned into a successful well-known international organization by becoming the world’s leading retailer of specialty coffee uses the Horizontal structure, where they use a matrix organization. According to Bateman and Snell (2011), a matrix organization is a hybrid form in which functional and divisional forms overlap.

Starbucks has more than 18,000 retail stores in 60 countries (“Starbucks”, 2012), and they chose to use the Horizontal structure. Starbucks uses a matrix organization that incorporates both functional and divisional organizations. Starbucks has a Chief Executive Officer (CEO), who is also the president and chairperson of the company. Within Starbucks there are different departments within the company that comprise of different chiefs, which consist of a financial officer, marketing officer, information officer, etc. that run the company, which is a functional organization. Starbucks is broken down into a three-region organizational structure: China and Asia Pacific, Americas, and EMEA. Within the Americas region, they are four different divisions: Western/Pacific, Northwest/Mountain, Southeast/Plains and Northeast/Atlantic. Each of these divisions consists of a senior vice president, who reports to the President, which is a divisional organization.

According to Bateman & Snell (2011) functional strategies are implemented by each functional area of the organization and are developed by executives with input of and approval from the executives responsible to support the business strategy. The departments heads within Starbucks, receive direction and responsibilities from the CEO, however, are allowed to make their own decisions.

Starbucks operates on the functional design. Within the...