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STRATEGY ANALYSIS AND EVALUATION - Essay Example
Pages 9 (2259 words)
Starbuck’s Strategy Analysis and Evaluation Name: Institution: STARBUCKS’ STRATEGY ANALYSIS AND EVALUATION This paper seeks to perform a strategic analysis and evaluation of Starbucks using Porter’s generic strategies model and Porter’s value chain model…
A company can gain a competitive advantage by optimizing the coordination of the value chain to create value for services and products, which are more than what it would cost to perform value activities. Thus, a company could create additional value without necessarily having to increase costs or amount of producing these products or services. The customers then pay for the added value. Starbuck’s strategy will also be analyzed and evaluated using Porter’s generic strategy, which involve focus, differentiation, and cost leadership. Cost leadership involves pursuing reduction of costs through a firm control of overheads, sacrificing R&D, and avoiding less profitable and marginal customers. Differentiation involves coming up with a unique product in the market that could be customer service, dealer networks, and brand image. Focus involves targeting a specific group, segment, or geographic market of a product line. Starbucks today would seem to be pursuing differentiation as a generic strategy, although when it started out, its generic strategy was more the strategy of focus emphasizing more on differentiation in a specific segment of the target consumer. ...