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Starbucks: International Expansion Model?

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A major producer of polymers in the United States is about to expand its business. As part of this expansion, it will begin to sell its products in Europe and Asia. In addition, it plans to open a plant in Asia. Maverick, the President and CEO, is concerned; he has heard many stories of companies that have tried to expand globally but operations either failed miserably or did not live up to expectations due to the cultural differences between workers and customers in each country.

Maverick has asked your group to research problems other companies have had with this issue and develop ways in which the errors those companies made can be avoided by his company.

Select a multinational corporation or international nonprofit agency that has encountered these problems (this can be a previous or current employer of yours). Using the Internet and the library, research that organization to discover any cultural barriers that organization encountered and what its managers did to try to overcome those barriers.

Generate and evaluate reasons why people may not appreciate the cultural point of view of others. Use at least 10 references (including 3 from the textbook) as well as 3 sociologists' views.

Discuss how appreciating cultural diversity affects peoples' ability to communicate effectively in the context of a multinational corporation or an international nonprofit agency. Feel free to add your own experiences as well as quoting others.

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Solution Summary

The solution provides students advice in tackling the problem above (international expansion and issues with cultural differences diversity). It also presents the case of Starbucks Coffee Co. as a possible model for international expansion. Elements of the company's history and strategies for expansion is included. A sociological perspective is used to analyse the strategies employed. References have been listed fr further studies on the topic.

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Dear Student,

Hi. The solution below should get you started. For this exercise, you must be aware that culture as a barrier in business, especially international business, is a very common issue experienced by multinational corporations and organizations. Culture is unique and it encompasses traditions, practices and viewpoints of people; in how they do business for example and how they judge products and others. To get the attention, the respect and the loyalty of the new market, new partners and new staff, it is important that the expanding organization takes into account cultural differences. May I suggest visiting this links to understand to explore this issue -

1. http://smallbusiness.chron.com/issues-workplace-because-difference-culture-2952.html - this is primarily in a workplace setting without the element of international expansion
2. http://www.orientpacific.com/paper1.htm - this is an interesting look at the analysis of a company and the strategies they have come to use in their expansion for the purpose of tackling cultural barriers.

The solution below is an exercise in sociological thinking applied in a business setting. It should get you started. It is a very familiar company - Starbucks Corporation. Good luck with this project and thank you for using Brainmass.

OTA 105878/Xenia Jones

Starbucks: A Role Model for International Expansion

Starbucks, the NASDAQ traded US Coffee Company started as a small coffeehouse in Seattle established by 2 teachers and a writer. It was a typical coffeehouse where those looking for coffee, a place to read, chat and meet came together as a local hangout from 1971. It wasn't until the entry of Howard Schultz, its present CEO that Starbucks Coffee Company became the 'cafe' we associate a cosmopolitan coffeehouse with today. He joined the company as a Marketing Director and after a trip to Milan Italy, came home with the idea of offering espresso and beans as well as specialized brews in a fusion ambiance between a chic Italian cafe and the comforts provided for by the local coffeehouses - couches, dark wooden floors and the aroma of coffee in the air. By adapting a personalized approach and employing baristas to showcase the coffee making process, it was quickly accepted and became a trend creating a demand. Schultz bought the company and opened branches across the US. It became the hip place to be creating a new kind of coffee culture. Where once the thing to do is go to fast-food restaurants or chains, Starbucks became the destination. Jazzy and mellow tunes, friendly baristas, comfortable setting and a relaxing ambiance made it a favourite that eclipse local competitions. The products were affordable and the practice of fair-trade made it a trendsetter in corporate responsibility making it attractive as an ethical company to the consumer. There are now 17,009 ...

Solution provided by:
  • MPhil/PhD (IP), Open University, Milton Keynes, UK
  • MA, Open University, Milton Keynes, UK
  • Certificate, Geva Ulpan (via Universita Tel Aviv)
  • BA, University of the Philippines
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