Starbucks HR policies and practices
Employees at Starbucks represent an important asset of the company and they are crucial for the company‟s growth. Due to the fact that the recruitment process represents a vital step for the organization it is of greater importance to hire the right candidates, provide them with training sessions and ensure them a fast development within the company. Starbucks uses its Human Resources policies and practices as a strategy to gain competitive advantage within the international market and the retail industry. Through the adequate implementation of human resources management, that comprises all the activities that a company takes to attract, develop and retain committed employees, Starbucks remain one of the most awarded company for its Human Resources practices (web-books.com, (web-books.com, 2011). 2011).
Retaining valuable employees employees implies
encouraging them to succeed, evaluating them on a r egularly basis, providing them with benefits and being able to undertake the necessary actions to keep them within the organization. The company‟s company‟s recruitment motto is “To have the right people hiring the right people” by focusing on people‟s energy and believing that candidates with the appropriate skills might easily become an asset for the company (Regani, 2005, p.3). Starbucks offers different types of training program, such as “First Impressions” for all the employees due to the fact that the organization relies a lot on the frontline staff by being the first ones to interact with potential loyal customers. This program consists in providing the employees with the right knowledge concerning the company‟s values and how to foster it amongst customers. Besides this, they were also taught the service principles. (Regani, 2005). For instance, all the employees had to be aware of company‟s history, to know all the rules regarding the coffee preparation and how to use a cash register. In
addition, they should have the appropriate communication skills in interacting with customers in order to create the proper environment that Starbucks was trying to promote. Furthermore, Starbucks developed its human resources policies and strengthen them to the extent that employees felt connected with the managers and the organization itself.
The company gained recognition amongst people by being one of the first
organizations to offer same advantages and benefits to part-time workers as for the fulltime employees (Wilson, 1999). Employees that achieved a certain number of hours benefited of health insurance coverage, which depended on the personal needs of each worker. Moreover, Starbucks was offering dental and vision insurance and as well it was covering different medical treatments, such as hypnotherapy and naturotherapy. (Regani, 2005). The company succeeded to offer their employees a wide variety of benefits such as income protection, saving plans, partner discounts or even free drinks on a regularly basis. Another unique benefit of Starbucks, which was called “Adoption Assistance Program”, was designed to reimburse employees a certain amount of expenses that had occurred during the adoption process (Starbucks, 2007). (Refer to Appendix I). Furthermore, these benefits led to employee motivation, recognition and on the same time the company succeeded to have a low employee turnover. In addition, Starbucks was the only company in this industry that offered the highest wages by exceeding the minimum wage as specified by state laws by a reasonable margin (Regani, 2005). In 1991, Starbucks developed a new strategy by creating the “Bean Stock” Plan available for employees that worked more than six months within the company (Wilson, 1999). This program consisted in offering the employees the opportunity to play an important role in the company‟s performance. In addition, due to the fact that this plan
was offered to all employees, Starbucks began to call its employees „partners‟, highlighting that each member of the organization is equal (Regani, 2005). Additionally, a new solution was found to maintain low employee turnover by developing the “Working Solutions” program to help the employees in their daily life (Regani, 2005). This work-life balance concept was designed in order to help employees to cope with their daily life problems and on the same time to be able to maintain or improve their work performance. Starbucks decided to be more aware of their employee‟s needs outside work in order to retain their valuable staff members. According to Thompson (2003), companies must provide to employees more than an adequate salary and a medical plan in order to gain a competitive advantage. Starbucks program was focused in fulfilling employees‟ needs by offering them childcare or even elder care assistance. Starbucks believed that this will had a positive impact upon employees‟ turnover and the overall business performance. In order to strengthen the relationships between employees, not only inside the company but also outside of it, Starbucks designed a new program called „Partner Connection‟. Its aim was to bring together employees that shared the same interest, varying from parenting until social activities. In addition, in 2000, Starbucks became recognized by its flexibility by offering to all employees an adaptable schedule in order to create a balance between work and life (Regani, 2005). Moreover, in order to assure that their employees are satisfied and motivated at work, Starbucks created a new program called “Partner Snapshot”, which was conducted on a regularly basis surveys to monitor whether their human resources policies are having the desired impact or whether they need to be changed (Wilson, 1999).
Business strategy aligned with Human Resources policies Starbucks remains one of the companies that value its mission statement and principles by trying to implement them within the organization and by rising awareness amongst their employees on a regularly basis. Starbucks always succeeded to put its employees on the first place by thriving to achieve one of the most important objectives of the organization, which is to “provide a great work environment and treat each other with respect and dignity”(Regani, 2005, p.5). Also, the mission statement was of greater importance for Starbucks and in order to increase its awareness, employees were provided with a copy of the mission statement when joining the company. In addition, at each meeting, the decision-making process was consisting in taking into consideration Starbucks‟ values and guiding principles (McLean, 2007). Moreover, the company develop a new program called „Mission Review‟ that permitted employees to express their opinions regarding any decisions taken within the organization that didn‟t respect the guiding principles of Starbucks. The person to whom the comment was addressed to was responsible to give an answer in maximum two weeks with the propose solutions for the certain matter. This program was taken very seriously and it proved to be a success by accumulating more than two hundred Mission Review opinions every month (McGraw-Hill College Division, 1997). Furthermore, in order to “treat people with respect and dignity” Starbucks implemented various values to promote and foster equality between employees. One way of doing this was to refer to all its employees no matter the rank as „partners‟ (George & Pierce, 2007). Another example of promoting equality was by not capitalizing the job titles emphasizing that everyone within the organization is treated with the same degree of
respect and humbleness. Moreover, in order to retain its employees Starbucks developed a unique strategy. For instance, managers of different departments had to call random stores and to thank employees for their good performance (Canak, 2006). This policy was designed to motivate and retain employees within the organization by highlighting that their work performance is vital for the company‟s overall business performance. Starbuck‟s unique selling proposition was created to foster the proper „Starbucks Experience‟ amongst its employees. The aim of this guiding principle was to maintain Starbucks atmosphere by strengthening the relationship amongst employees and by encouraging them to be creative. The overall strategies and efforts implemented by Starbucks has helped the company to retain, motivate and empowered its employees by remaining one of the most recognized companies worldwide in the retail industry.
Recommendations Trough the analysis of Starbucks business strategies and Human Resources policies, it was noticed that the company succeeded in most of the times to align its company‟s mission statement, principles and values with its human resources practices (Refer to Appendix II). Moreover, by achieving this alignment, Starbucks had a fast growth in this industry and as well the company easily succeeded to differentiate itself from the competitors in the market. According to Appendix III, one issue identified is concerning one of the Starbucks principles, which is to “embrace diversity as an essential component in the daily business activities”. By analyzing the company‟s Human Resources policies and practices it is noted a gap between the above principle and the fact that the organization doesn‟t focus that much on the workforce diversity. Starbucks programs have proved to be successful in terms of creating employees retention and motivation. However, by taking into consideration the international expansion of
Starbucks it is noted that staff members don‟t benefit of a diversity-training program. The purpose of implementing such a program should b e to increase employees‟ awareness towards the different ethnical backgrounds of their colleagues or even customers. Moreover, these training sessions may aid in creating a more friendly work environment,
improving
employees‟
communication
skills
and
avoiding
any
intercultural conflicts to take place. Furthermore, the positive impact of this program will be easily reflected upon the overall business performance of the organization. Starbucks should consider the implementation of a diversity-training program in order to be able to cope with the new challenges that may arise in the near future.
References
Starbucks.(2007). U.S. Adoption Assistance Program. Retrieved February 28, 2011, from
http://lifeat.sbux.com/NR/rdonlyres/8E18A19E-ECB2-436C-
916A-443ADE37818A/0/AdoptionAssistance012607.
Thompson, D.(2003). Help employees achieve a work/life balance. Retrieved March 2, 2011, from http://office.microsoft.com/en-us/word-help/helpemployees-achieve-a-work-life-balance-HA001171777.aspx
Web-books.com.(2011). Human Resources Management . Available from
http://www.web-books.com/eLibrary/NC/B0/B66/055MB66.html
Wilson, T., B.(1999). Building a Unique Total Rewards and HR System For A Unique Company At Starbucks. Retrieved February 26, 2011, from
http://www.wilsongroup.com/ecr/case/Starbucks.pdf
