WITH

WITH REFE
REFERE
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NCEE TO A BUSI
BUSINE
NESS
SS ORGA
ORGANIZ
NIZA
ATION
TION THA
THAT YOU HA
HAVE
VE
STUDIED EXAMINE HOW INNOVATION AND CHANGES IN THE EXTERNAL
AND INTERNAL BUSINESS ORGANIZATION
ORGANIZATION CAN AFFECT THE OBJECTIVES OF
A BUSINESS ORGANIZATION.
ORGANIZATION. (THE STUDENTS SHOULD ALSO WRITE ABOUT
ETHICS AND CSR IN CHANGE)

CUEGIS on Starbucks
Thar Lun and
a nd Ye
Ye Min

This is our first CUEGIS report on a global company named Starbucks! "hich is famous for their
great taste of coffee#
CUEGIS Thar Lu a! Y" M# M$!a%& S"'"*"r +,& +-/

Starbucks
Starbucks Corporation$ doing business as Starbucks Coffee$ is an %merican coffee company and
coffeehouse chain based in Seattle$ &ashington# Starbucks "as founded in '()' by *erry
+ald"in$ ,e- Siegl and Gordon +o"ker in Seattle. and$ since then it has been e/panding rapidly
to the global scale# Starbucks is no" the largest coffeehouse company in the "orld "ith 00$)11
stores in 12 countries and territories# Starbucks offers the -arieties of coffee and be-erages in
e-ery coffeehouse. moreo-er$ through the Starbucks Entertainment di-ision and 3ear Music
 brand$ the company also markets books$ music$ and film#

Innovation
Inno-ation is an organi4ation5s process for introducing ne" ideas$ "orkflo"s$ methodologies$
ser-ices or products due to the sophisticated market demand# It includes researching on possible
 beneficial product and de-eloping the modern$ reasonable$ efficient products to gain the
competiti-e ad-antage o-er the business6s ri-als$ contributing the key element in pro-iding
aggressi-e top7line gro"th# 8or e/ample$ inno-ation has created ne" leading industry such as
Smartphone# 3o"e-er$ sometimes it can turn the business into the great loss# The causes of loss
can be from internal or e/ternal# 8rom internal$ the factors may range from poor time
management to poor creati-ities of the de-elopers# 8or e/ternal$ the factors may range from
go-ernment policies to cultural background depending on the location# So$ inno-ation is the
important strategy for the business success and failure#

Change
9ue to the continuous changing e/ternal and internal factors$ change should be managed "ithin
 businesses if they are to mo-e for"ard and remain competiti-e# These factors come from -arious
 backgrounds# Those include the population change$ culture change$ ob:ecti-es change and
etc###The importance of these factors determines "hether the change should take place or not#
Sometimes$ changes are made# 3o"e-er$ not all changes fa-or the businesses$ but also gi-e
negati-e impacts on the business as the changes made do not al"ays guarantee for the business
 profit# 3ence$ the businesses should be a"are of the surrounding changes in the e/ternal
en-ironment and need to adapt to the ne" situation ;uickly not to be left behind in the business
"orld#

Changes in internal business organization

Internal business organi4ation refers to the issues and functions "ithin the business "hich is
controlled by the business# <ccasionally$ numerous changes are made "ithin the business "hich
sometimes brings benefits and sometimes negati-e effects# <f course$ managers and CE< "ill

+
CUEGIS Thar Lu a! Y" M# M$!a%& S"'"*"r +,& +-/

al"ays try to choose the most beneficial methods and changes e-en though it is -ery risky# <ne
of them is the change in the business ethic#

1. The change in ethical objective

Ethics refer to the moral principles that guide decision making and strategy# Morals are
concerned "ith "hat is considered to be right or "rong$ from society6s point of -ie"# +usiness
makes ethical changes "ithin the business by changing the mission and -ision statements$ the
-alue of the organi4ation and often these are due to the pressure group$ the demand of the local
communities#

2. The change in CSR 

+y changing in the business ethical beha-iors$ the business becomes socially responsible
 business to"ards their stakeholders such as employees and the local communities# Those duties
are kno"n as corporate social responsibilities =CS>?#

Business objectives
The business ob:ecti-es simply refer to the short to medium term specific goals of the
organi4ation$ based on its aim# Usually$ ob:ecti-es are measurable# There are -arious ob:ecti-es
such as ethical ob:ecti-e$ tactical ob:ecti-e$ and strategic ob:ecti-e#

%nalysis
The inno-ati-e ideas are needed in almost e-ery business as inno-ation brings lots of 
 benefits to the business# So$ these inno-ati-e ideas are produced from the de-elopers and >@9
teams of the businesses to get to the ob:ecti-es of the business# 3ere$ the business may ha-e the
"ide range of ob:ecti-es and some tools ha-e to apply to achie-e it# %s "e described$ SM%>T
analysis has to be used here to assess ho" inno-ation "ill affect on the business ob:ecti-es#

8rom Starbucks$ "e can see that Starbucks has done inno-ations on coffee making and
uni;ue ser-ices# Starbucks has de-eloped the ne" different coffee products for different types of 
consumers# In 0A'0$ Starbucks has introduced us the ne" type of coffee "hich is the first deli-er 
thirst7;uenching refreshment from real fruit :uice and a boost of natural energy from a ne"
source$ green coffee e/tract# The introduction of this product is an e-olution of the coffee market
using a ne" breakthrough coffee e/perience using green coffee e/tract$ resulting in delicious$
lo" calorie refreshment "ith a boost of natural energy from caffeine and fruit :uice# It has gi-en
the Starbucks the opportunities for the global coffee market as it attracted the "orld coffee
consumers and has affected the coffee related businesses as "ell as ri-als# Through this
inno-ation$ Starbucks has gain competiti-e ad-antage in market and has impro-ed in market
standing# 3ence$ some tactical ob:ecti-es of Starbucks has changed due to the e/pansion in the
ser-ices and function in the business#

0
CUEGIS Thar Lu a! Y" M# M$!a%& S"'"*"r +,& +-/

In addition$ the changes made in Starbucks ha-e affected the "hole business ob:ecti-es#
Since it "as founded$ the business has strong ethical ob:ecti-es# Starbucks used to only
 purchased the best ;uality coffee beans from Latin %merica$ %frica and %sia and it included
forest conser-ation programs and loaning to farmers "hich ha-e benefited to the local
communities as "ell as to the business image and to the "orld climate# Moreo-er$ Starbucks
-alues the employee as much as customers and gi-en the rank as the business partners "here
Starbucks being as a good CS> business# Since then$ the simple mission has ne-er changed and
only the additions to the missions are made# Starbucks focus on making the emotional
connections to the coffee and the atmosphere "here the consumer can en:oy a moment "ithout
 pressure#

%s the changes in the e/ternal en-ironment "ere really fast$ Starbucks has to cope "ith
the changes by using different methods# The population increased and the business has to e/pand
to different parts of the globe$ so that Starbucks got more customers as "ell as strong competitors
across the "orld# +efore e/panding$ Starbucks had to take cautions in entering the different
cultures based market by adapting to the local business styles and regulations# So some parts of 
the main business departments6 ob:ecti-es ha-e to change to suit "ith competiti-e business
"orld# 8or e/ample$ Starbucks has opened numerous social foundations and youth centers to get
the good business image from the local residents and pressure groups# It includes the Starbucks
foundation and -arious farming communities# %lthough the compliance costs on these social
responsibilities are fairly high$ the impact on main stakeholders such as o"ners and employees
"ere not big enough for them as in return they en:oy high profile in business standing compared
to their ri-als#

Summary
8rom interpreting the analysis and the "ritten information$ Starbucks had made changes
and inno-ations for their better future# These concepts ha-e caused impacts on business
ob:ecti-es up to some e/tent and those impacts ha-e been good for the Starbucks# To sum up$ the
inno-ation and changes of Starbucks has sho"n us that by applying those skills efficiently results
in better future of the business#