What is Starbuck corporations current strategy?

1b. Is Starbucks' competitive advantage sustainable? Give your reasons.

2. What are Starbuck corporations resources & capabilities, and what is Starbucks strategic capability?

Starbucks Corporation Coffee drinking became popular in the Middle East and North Africa during the 16th century and spread to Europe in the 17th century with the opening of coffee houses in Venice. London, Paris and Amsterdam. By the eariy 20th century, coffee had become the most popular everyday beverage in continental Europe and throughout the Americas. The introduction of instant coffee in the 19503 further expanded the mass market for coffee. The fact that coffee drinking had been an established feature of Western culture for almost 500 years made it all the more remarkable that an appliance salesman from Brooklyn, New York could create a global chain of 21 000 coffee houses with a stock market value of $52 billion. The rise of Starbucks: Wake up and Smell the coffee When Howard Schultz visited the Starbucks coffee store in Pike Place Market, Seattle, the coffee he sampled was a revelation. He joined the company in 1982 and, after a vacation in Italy, became convinced of the potential of Starbucks to sell brewed coffee as well as coffee beans in an effort to recreate the Italian coffee-drinking experience: 'I saw something. Not only the romance of coffee, but a sense of community. And the connection that people had to coffee the place and one another.'33 The owners of Starbucks were not convinced, so Schultz left to set up his own coffee house. Later, when the opportunity arose. Schultz acquired the original Starbucks business and began its transformation and expansion. Schultz's vision for Starbucks was based not just on serving superior coffee but also on creating an entire experience in which Starbucks coffee houses represented a 'third place' somewhere other than home and work where people could engage socially while enjoying the shared experience of drinking good coffee. The strategy comprised several elements: Acquiring coffee beans of a high, consistent quality and carefully managing the chain of activities that resulted in their transformation into the best possible espresso coffee. 'We're passionate about ethically sourcing the nest coffee beans, roasting them with great care, and improving the lives of the people who grow them.'34 Starbucks partnered with growers in order to promote best practice in coffee cultivation. Employee involvement. The counter staff at Starbucks stores the baristas were central in creating and sustaining the Starbucks Experience. Their role was not only to brew and serve coffee but also to engage customers in the unique ambiance of the Starbucks coffee shop. Starbucks' human resource practices were based upon a distinctive view of the company's relationship with its employees. If Starbucks was to engage customers in an experience which extended beyond the provision of good coffee, it was going to have to employ the right store employees who would be the critical providers of this experience. This required employees who were committed and enthusiastic communicators of the principles and values of Starbucks. This in turn required the company to regard its employees as business partners. Human resource practices aimed to attract and Page 1 of4