Starbucks and Lean Management

Starbucks – Lean Management

Since 1971 Starbucks has prided itself on brewing the highest quality of Arabic coffee in the world and being the largest coffeehouse in the world. Although Starbucks is essentially a chain, as we can find one on almost every corner in every busy shopping center, the company built its model and developed its culture prestige and high-quality coffee beans. This is what has allowed the company to operate on inflated pricing and maintain its customer base for quite a long time. However, with the recession and customers looking to save money, Starbucks has been faced with serious competition from McDonalds and Dunkin Donuts. These competitors have managed to offer customers quality coffee and specialty drinks at much more reasonable pricing.

With competition stealing away Starbuck’s customers, the company had the choice of shutting down stores and laying people off, or improving the current operations within the stores to work with the same number or fewer employees to make more drinks. This operations strategy was called “Lean Management.” It allowed Starbucks to train its current employees to move around behind the register, coffee making machines and store much more efficiently and strategically. Starbucks wanted to design not only the layout of the store, how certain coffee making items are positioned, but also how employees can use this newly designed environment to develop their own strategy for efficient work. They were focused on optimizing the flow within the store, which essentially would require less work but more output. Since a lot of time is spent walking, reaching and bending, Starbucks wanted to eliminate unnecessary motions that were taking up time and employee capacity and turn that waste into savings through efficiency.

Starbuck’s previous model of offering fancy products and opening new stores would not be an effective strategy for the current recession times. Starbucks, along with many other premium brand...