Histrical View (Background):

The beginning was in 1985 (small coffee shop in Seattle) $ 8 billion in revenues. Moe than 13,000 retail outlets world wide. In 2007, its market capitalization was approaching that of Ford & General Motors combined. By selling cups of consistent, although richly priced coffee.

Problem :
Starbucks strategy is based on innovation . Starbucks face high cost to such complex innovative offering. innovative complexity increase the time required to serve its customer. demand for its labor intensive customized drinks declined.

Analysis:
"Highly satisfied customer" spent $ 4.42 on average during each visit ( 7.2 times a month). "Unsatisfied customers" spent about the same amount per visit ($ 3.88), they only averaged about half as many visits (3.9) each month. 75 % of customers valued friendly, fast, convenient service 15% considered new , innovative beverage to be highly important. Innovation is a key part of Starbucks's strategy. "Time of delivery" is main part to serve customer .

Recommendations:
Tradeoff occur when activities are incompatible. manager should recognize tradeoffs in their strategies and activities .(innovation and fast customer). manager should realize the overemphasis on innovation.