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Running head: BUSINESS POLICIES AND STRATEGIES
Business Policies and Strategies
Institution Affiliation
Instructor’s Name
James Henry
Course Code
Date
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BUSINESS POLICIES AND STRATEGIES
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BUSINESS POLICIES AND STRATEGIES
The company used for this task is Starbucks Company. I choose this firm, as Starbucks is
the best coffees selling the company in the United States of America with sales of over $12.7
billion. The firm’s CEO is Kevin Johnson (Koehn, 2001). In this paper, I am supposed to take
the role of vice president of strategic planning where am tasked with evaluating the company
past performance and the impact of the economic changes to the company. In this paper, I will
discuss the mission and vision statement for a strategic plan for the corporations next 3-5 years,
SMART goal and objectives, industrial analysis and a perceptual map. This plan will be used as
a sample standard for the new employees.
Mission and vision statements
The mission statement of organizations states the long run goals that the organization is
set to accomplish this is by ensuring that it has solved their client’s problem for a better future.
The mission statement is “to provide America with the better solution for their quest for the
employment of an extensive variety of ample and standard of fast foods.” Vision statement, the
vision statement refers to the statement that described the future of the organizations to where the
organization sees itself in the years to come. This provides the visionary element of the top
management in the organization. In this case, the vision statement for the strategic plan is “to
become the best solution for our company’s short term and long term problems by putting our
clients first while ensuring continuous improvement all through our plans.” With this mission
and vision statement then the strategic planning departments will have a well-laid direction of
what the long-term goal entails. The strategy will work to ensure that the current company
problems are provided with a better solution for the future while avowing the repeat of the same
in the future.
BUSINESS POLICIES AND STRATEGIES
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SMART goals and objectives
This is an efficient process for setting and achieving business goals. In this case, there are
the goals that the strategic plan will tend to attain. The first goal is to accomplish a competitive
advantage; the strategic plan steps will achieve two steps per every quarter for the next three
years. The steps will be set to ensure that the food is of more quality and that they are healthy
and nutritious following the current people’s sensitivity to their health. The product quality will
be improved, and by the end of four years’ time, the company will have had a competitive
advantage over their competitors. The second goal is to diversify the product mix; the
measurement of the effectiveness will be on the number of the clients willing to buy the new
products introduced. The company will offer additional products like ice cream and milk
products to their formers products to ensure that their customers need catering for. This will take
the company relatively four years to materialize. The third goal is to expand the markets share;
the measure for this will be the percentage increase in the market share across the world. The
company will ensure that they have extended to the Asian and Europeans markets offering the
different product mix for the new five years.
Industrial analysis
Industrial analyses refer to the evaluation of the company’s situation. In this case, I will
discuss the following:
The company’s current situation analysis
To prepare an excellent strategic plan for the company then it is essential for the team to
understand the company’s current situation. Currently, the employees’ skills and performance is
not good. Some of the employees are not fully devoted to their work some lack the skills to use
BUSINESS POLICIES AND STRATEGIES
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the machines presented like the cash receipt machines. This might be because some of them are
students working part-time, and they might be encountering the machines for the first time. This
makes some of our clients go home unsatisfied therefore the company deserved better-skilled
employees with good customer relations. Competition is stiff. Currently, the company is facing
competition from McDonald’s company that has dominated American market. This competitor is
ranking as the best with sales amounting to $35.6 billion. This is a significant threat to the
company. Technology has changed, and most of their competitors are employing the use of
technology to create competitive advantage. Therefore, the company should ensure that the job is
given to the right person. The company has plans to expand to others countries like China and
Europe this is to ensure that they get the benefit of being a starter in those areas.
Starbucks SWOTT analysis
SWOTT analysis refers to the evaluating of strengths, weaknesses, opportunities, threats
and trends that affect something. Strengths: Solid market position and worldwide brand
acknowledgement; In the United States, it has a 36.7% market shares and maintains a significant
representation across the globe as it operates in over 60 countries. It is also acknowledged brand
in the coffee house section. It uses its band by licensing other products to use its logo. This gives
the company a competitive advantage. High products quality. They provide the premier
prominence to their products and ultimately avoids normalization of their condition even when
producing high quantity. Site and appealing to its stores across the globe, Starbucks have the
strategic positions and locations in the whole world. This makes it accessible to the consumers.
Their stores are visually appealing to their customer’s hence great attachment. Distinct product
mix, the products offered are meant to meet the needs of all groups of persons across the
populations (Smith, & Hu, 2013).
BUSINESS POLICIES AND STRATEGIES
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Weaknesses: Expensive products, the high-quality tag of the Starbucks product makes
them more differentiated hence the consumers need to buy the products at a price that is higher
than the prices of the competing firms. Overdependence in United States markets, a huge
revenue comes from the US hence making the company very sensitive to any significant changes
in the US economy and its growth. Although it sells their product globally, most of the stores are
in the US. Self- cannibalization through overcrowding, Due to the aggressiveness that Starbucks
has on expansion, then it ends up killing the long run dream of growth targets (Smith, Maguire,
& Hu, 2013).
Opportunities: Expansion into emerging markets, due to overcrowding in the US, then the
company have the chance to explore other countries and make new market shares. Expanding
product mix and offering. The fact that they are growing their product mix and starting to sell tea
and fresh juice products then this is a great opportunity to venture in new product mix (Harrison,
Chang, Gauthier, Joerchel, Nevarez, & Wang, 2005). New distribution channels, Mobile pour is
the current delivery version that is employed by Starbucks Corporation. This provides the
opportunity to for expanding the distribution of their products system and could lead to more
revenue being realized by the firm.
Threats: Increased competition, McDonald’s, Costa coffee and other big firms are posing
competition for Starbucks as they are currently increasing the market shares in the US. The
company is in its mature stage. Therefore, this is a more significant challenge to face. Price
volatility. In the global coffee market, there is a substantial fluctuation in the market prices of
high-quality coffee beans, and any firm cannot control this. Changing consumers’ tastes and
lifestyle choices, People are currently adopting a healthy lifestyle. Therefore, coffee intake is
decreasing this is a threat to the future.
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BUSINESS POLICIES AND STRATEGIES
Trends: In the case of economic crises, the consumers tend to shift from best product mix
to stay in the restricted budget during monetary lacks. Saturation in the developed countries
market. Majorly Starbucks revenue is earned from the developing markets, and this saturation is
a significant threat. Expansion of merchandizing operations. Currently in the food, industry
diversification of the portfolio is much appreciated. This offers the company a great opportunity
for the future to lead the growth a brand. Technology improvements. Currently, the food industry
has employed the use of technology regarding mobile application to meet more customers.
A Perceptual Map
The criteria I would choose is competitive perceptual positioning regarding fast food
offered for adults and children versus the people’s choice. This is because currently, the
company is facing a great competition form their competitors who have scoop the makers share.
The strategic plan will be meant to renovate the company to scoop as markets shares, get a
competitive advantaged that will position Starbucks ahead of their competitors.
A competitive perceptual positioning map
Wide choice
Subway
Dominos
For kids
KFC
pizza hut
McDonalds
Dunkin Donuts
Low choice
Starbucks
for adults
BUSINESS POLICIES AND STRATEGIES
Reference
Harrison, J. S., Chang, E. Y., Gauthier, C., Joerchel, T., Nevarez, J., & Wang, M. (2005).
Exporting a North American concept to Asia: starbucks in China. Cornell Hotel and
Restaurant Administration Quarterly, 46(2), 275-283.
Koehn, N. F. (2001). Howard Schultz and Starbucks coffee company. Harvard Business School
Pub..
Kumbirai, M. (2010). A financial ratio analysis of commercial bank performance in South
Africa. African Review of Economics and Finance, 2(1), 30-53.
Smith Maguire, J., & Hu, D. (2013). Not a simple coffee shop: local, global and glocal
dimensions of the consumption of Starbucks in China. Social Identities, 19(5), 670-684.
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