Luiz Carlos Jacob Perera, Presbyterian Mackenze University, Sao Paulo, Brazil Hans Ulrich Lenk, Presbyterian Mackenze University, Sao Paulo, Brazil Mariana de Souza Correa, Presbyterian Mackenze University, Sao Paulo, Brazil Anderson Nobuo Yoshikawa, Presbyterian Mackenze University, Sao Paulo, Brazil Alex Alves Gomes da Silva, Presbyterian Mackenze University, Sao Paulo, Brazil Rodrigo Kenji Arasaki, Presbyterian Mackenze University, Sao Paulo, Brazil ABSTRACT Changes in Starbucks began after 2005, when problems to challenge Starbucks’ success.
These problems continued to affect the performance of the company until December 2010. The objective of this research is to analyze Starbucks’ response to the effects of the 2007 financial crisis when its shares were devalued by more than 80%, dropping from US$39. 63 in May 2006 to US$7. 17 in November 2008, at the peak of the global crisis. Results show that the competence of its charismatic leader, Howard Schultz was essential to implement a restructuring of the company and bring it to your path of success. Really a story worth telling. Keywords: Starbucks, Howard Schultz, Global Financial Crisis, Stock Market, Event Studies 1.
INTRODUCTION Starbucks is a company with unique characteristics. As the coffee bean was losing market value in the United States, Starbucks was able to go against the tide and transform a commodity into a premium product offered in 16,800 stores in 54 countries around the world. What Starbucks offers is not simply a place to drink coffee. As you arrive in one of the stores, you become part of the Starbucks experience, as the company’s CEO, Howard Schultz, explains: When you start a relationship with Starbucks, you are going beyond the coffee experience.
You become a special person, in a nice place with quality music. We establish the purchase value of a product through quality and building a personal relationship with each one of our consumers. Starbucks rekindles people’s love affair with coffee, bringing the sensation of the fresh flavor of beans roasted in a special way (Schultz and Yang, 1997). Starbucks started in 1971 in the U. S. city of Seattle, where three professors who appreciated the flavors of exotic coffees and teas, led by a Dutch specialist, created the Starbucks Coffee, Tea, and Spice Company.
The store initially offered mainly coffee beans of good provenance, which it taught people to prepare with care. In 1975, the company was transferred to the Pike Place Market in Seattle, where Starbucks eventually became part of the local folklore. In 1982, Howard Schultz, who had fallen in love with the business, was hired to develop the company’s retail operations and marketing. On a trip to Milan in 1983, Schultz was fascinated by the Italian cafes and was captivated by the idea of selling coffee as an Italian-style drink. This newfound passion changed Schultz’s life and Starbucks’ track.
In 1987, Howard Schultz bought Starbucks with the support of local investors and became the company’s Chief Executive Officer (CEO), starting a strong growth cycle that endures to the present day. Starbucks went public in 1992, and in 1996, it undertook significant international expansion, adding openings in Japan and Singapore to its 1,000 stores. Starbucks ended 1999 with 2,500 stores. In 2000, Howard Schultz forfeited his executive functions and named Orin Smith president and CEO, and Schulz became the company’s chairman and chief global strategist.
In 2004, Smith retired after having implemented his five-year expansion effort – Starbucks had reached 8,569 stores – and making major investments in coffee crops and treatment, thus ensuring future supply. INTERNATIONAL JOURNAL OF BUSINESS STRATEGY, Volume 12, Number 1, 2012 19 2. THEORETICAL REFERENCE 2. 1 The Subprime Crisis in the United States The manner in which the crisis unfolded suggests complete and unexpected disorganization in the markets in the middle of the twenty-first century, the so-called information and knowledge age.
Adam Smith’s 1776 book The Wealth of Nations introduced the term invisible hand to describe how the interaction between participants in the market seems to result in a determined order, as if something was conducting them. He highlighted, however, that the combination of the hands of a few producers, intervening states and lack of information could result in market mismatches. Two centuries later, Stiglitz (2007) endorsed Smith’s theory: “[… ] individuals and companies, in search of their own interest, are not necessarily, or in general, conducted by an invisible hand toward economic efficiency”.
To understand the crisis requires understanding how the financial market and its alleged efficiency work. Fama (2007) wrote about the efficient market and offered a self-described simple idea: “[… ] the prices reflect all the available information”. What is important is that a model-balanced market is needed to measure market efficiency. The reverse is also true, as the balance models are supposed to bring efficiency to the market. Market efficiency suggests that the deviation from an expected balanced price cannot be predicted based on past information.
Gall’s (2008) analysis of adjustment measures highlights the main aspects of the crisis: i) negative interests, stimulating demand and inflation; ii) under-valued exchange rate from China, with low prices stimulating exports and demand from consumer countries (the yuan was worth between 1/3 and 1/2 of its real value); iii) weak regulation of the financial market, allowing for doubtful securities and exotic derivatives, and; iv) lack of governmental programs for investments in the infra-structure that would ensure employment and socioeconomic stability.
Krugman (2008) states that the U. S. economy was already technically in what would be called a depression but that we should not expect a depression as deep as the one in 1982, when unemployment reached a rate of 10. 7%. In this situation, do the usual economic policy tools, which make up the American Federal Reserve’s ability to stimulate the economy via the reduction of interest rates, lose their traction. Krugman says “[…] when depression economics prevails, the usual rules of economic policy no longer apply: a virtue becomes a vice, caution is risky and prudence is folly”.
Krugman and Wells (2007) remind us that the stabilization policy is to use fiscal or monetary policies to counterbalance the shocks of demand. The authors note that such policies may lead to an increase in the budget deficit and lower growth in the long run. Furthermore, they remind us that policies that are not well guided may increase economic instability. The crisis effect, from the macro point of view (i. e. , in the aggregate), has implications for unemployment and reduction of payroll and, consequently, for demand.
The reduction of demand does not affect all of the sectors of the economy in the same way, and the different sectors, in turn, react differently. Next, we explore the main elements that may affect the market in which Starbucks operates. 2. 2 Motivational Value for Consumers Maslow (1943) acquired fame through his theory about personal motivational factors. He tried to understand how motivation affects people’s behavior related to the decision-making process.
Maslow’s theory was incorporated into areas such as administration and marketing, in which it was used mainly in studies about decisions in the purchase process and its connection with consumer demand. The theory calls attention to the fact that all human needs are arranged in a hierarchy, and that some outweigh others. There is not necessarily a single motivational driver. Rather, there is a group of drivers, according to personal objectives. The drive that is most appropriate for reaching the desired objective predominates.
Figure 1 shows the pyramid displaying Maslow’s (1943) hierarchy of human needs. The author stresses that when a need is satisfied, another one always emerges; this is what he calls predominating. In terms of motivation, this suggests that the role of rewards is as important as deprivation. While Maslow’s study has been criticized for its lack of experiments, it has contributed to the design and modeling of organizational and marketing structures, and it is still frequently referenced in contemporary studies. INTERNATIONAL JOURNAL OF BUSINESS STRATEGY, Volume 12, Number 1, 2012
20 Krishnamurthi (2001) defines the concept of value as a consumer evaluation resulting from the impact of marketing. Thus, the concept is relevant for companies interested in winning and keeping their markets: Value is defined as the perceived worth in monetary units of a set of economic, functional, technical and psychological benefits perceived by the client in exchange for the price paid by the offered product, while taking into account the offers and prices of the competition. Value is relative; it is the consumer’s perception of a product’s usefulness.
Fixing the value of a good or service for the market leader is an art. Competition is an external disturbance that affects value. Quality is a consequence of the economical, technical, functional and psychological efforts of the product or service. The economical benefits, which are reflected in the price, result from management and production efforts, whereas the functional benefits of a product result from internal research and development. Examples of psychological benefits include comfort, reliability, safety, calmness, control, power, relationship, and brand.
Determining the price for Starbucks is one of the fundamental aspects of its business; its differentiating factor lies in the fact that it works with premium products. A premium product differs from the competition and thus makes comparison more difficult. Krishnamurthi (2001) states that the more difficult the comparison, the less the price will influence the purchasing decision. Nonetheless, he highlights the fact that a high price is associated with quality, which establishes the brand and has positive effects on the value of the product as seen by the customer.
This makes high-priced products stand out as premium items made for clients with a higher status. Lovelock (1996) suggests that price results from a tripod that takes into account cost, competition and the value for the consumer. For Starbucks, cost is a factor that goes beyond coffee price; its products are placed in a premium market in which status is fundamental. Status, in this case, is represented by the atmosphere, helpful baristas, commitment to the environment, and more recently, advertising. Relative to the competition, Starbucks enjoys a comfortable position and holds a market share such that it has few competitors.
It is worthwhile to discuss the classification of products offered by Starbucks. Its products are sophisticated and of indisputable quality. It sells premium-class products at a premium price for a segment of special clients. Considering the company’s motivation, the lifestyle of its consumers, and the consumption model (objects in series), Alleres (2000) classifies Starbucks products as accessible INTERNATIONAL JOURNAL OF BUSINESS STRATEGY, Volume 12, Number 1, 2012 21 luxuries. The author highlights that knowledge of consumption is one of the most important aspects of the luxury product market. 2. 3 Strategy, Planning, and Control
Ghemawat (1998) defends the so-called scope economy, stating that companies should be able to share their resources among markets and should seek to establish themselves in those markets before looking for new investments. This vision is supported by McManus, White, and Botten (2009), who highlight the paradigm shift related to the formulation of current strategic thought. The authors stress that the main challenge of modern companies is the development of abilities to deal with sudden discontinuities, which may change the future demands of organizations. These discontinuities are unexpected and irregular.
Facing such sudden changes, organizational leaders wonder, who is prepared to notice such changes and react, and who will be responsible for the strategy to be adopted? Anthony and Govindarajan (2002) define strategy as the process of deciding to use the available means with the goal of reaching a determined objective. Strategy unifies the internal means with the external means, the objectives to be achieved. Strategic planning is a process by which an organization reaches a decision on how to implement a determined strategy. In practice, companies compare expected results with achieved results based
on previous periods. This practice requires that accumulated annual results be compared to achieved results, thus avoiding seasonal lags. Anthony and Govindarajan (2002) emphasize that top management requires updated information to make its decisions and correct its mistakes when necessary. The authors note that estimates of annual performance and the corresponding follow-up are usually subject to appreciation by financial analysts and external entities, such as the stakeholders. 3. METHODOLOGY This research makes use of secondary data and, according to Abramo (1979), might be classified as applied and comparative.
The research is also bibliographic, descriptive, and explanatory because it characterizes facts and tries to explain them. 3. 1 The Method Starbucks’ behavior was studied from the point of view of the stock market. As a research strategy, two periods of administrative management were chosen for analysis. The analysis began with Jim Donald, who assumed the position of CEO in January 2005. He was followed by Howard Schultz, who returned to the job in 2008. The period under analysis ends in December 2010. Therefore, 24 quarters were analyzed in two periods of three years.
The periods were considered sufficiently long to give the executives an opportunity to correct the track of their strategic decisions, when necessary. The quantitative analysis was developed through 24 sequential event studies. In short, the rationale for sequential event studies lies in the planning and control system developed by companies. Anthony and Govindarajan (2002) highlight the importance of updated information for decision making and for correcting the track when necessary, which companies periodically do when comparing the results achieved with the pre-established targets.
The accumulated results from the fiscal year are also compiled. When targets are reached or exceeded, decisions are validated, and the successful experience is registered. McManus, White, and Botten (2009) state that when targets are not reached, the strategic plan is redesigned for the recovery of future demand (i. e. , expected accumulated results). 3. 2 Event Study The initial procedure for conducting an event study is to define the event of interest and to designate the limits of a period for which share prices are followed and analyzed. This is called the event window.
Evaluating the impact of an event requires the measurement of abnormal returns. The normal return is considered the expected return if the event has not happened, and the abnormal return is the variation of return promoted by the occurrence of the event. For company i and an event that occurred in , the abnormal return would be ARi? = Ri? – E (Ri? | X? ). INTERNATIONAL JOURNAL OF BUSINESS STRATEGY, Volume 12, Number 1, 2012 22 ARi? , Ri? , and E(Ri? | X? ) are the abnormal return, the occurred return and the normal return, respectively, for period ? ; X?
is the information for calculating the normal return model. In this study the market model will be used, where X? is market return. The results are a consequence of the model adopted to observe the normal results and, hence, the importance of considerations for the definition of the null hypothesis (there are no abnormal returns) and the determination of a technique for aggregating abnormal returns, the Cumulative Abnormal Return (CAR). Ideally, the empirical results would lead to the understanding of sources and causes of effects (or lack thereof) for the studied event (MacKinlay, 1997).
To check for the existence of abnormal returns, it is first necessary to determine the model of the normal return. The normal return should be connected to the previous parameters of the event, hence the estimate window. In the present study, the market model represented by the NASDAQ Composite Index daily returns is applied. The active object of study is represented by the daily returns of a share of Starbucks stock. The study period extends from the first quarter of 2005 through the fourth quarter of 2010. The market model is typically presented in the following manner:
The flow of the event study can be seen in Figure 2. Considering the market model, it was decided to use only weekdays to make the necessary estimates. Initially, an estimate window is considered that serves as a basis for the market model, which in this case encompasses a period of 40 days. Subsequently, the event was characterized in relation to the results from the quarter nearing completion, and the event window was estimated over 20 days, the necessary period for adjustment (strategic) decision making. The post-event window, when the market model calculated in the estimate window will be applied, lasts 40 days.
The result of the market model application will be the calculation of abnormal returns and the sum of abnormal returns, or the Cumulative Abnormal Return (CAR). The complete cycle comprises 100 weekdays, counted backwards from the date at which the finished post-event window was considered. It is observed that there were no overlapping deadlines, the existence of which could skew the model. The adopted methodology also implies that the one-quarter post-event window corresponds to the estimate window of the next quarter.
The event study based on quarters follows the example offered by MacKinlay (1997). The option of mounting a basis of sequential event studies for analysis is justified by the following points: i) twenty-four quarters of operational management (twelve for each of the managers) are analyzed, thus avoiding casuistic analysis and creating conditions for recovery and for possible strategic adjustments; ii) the control functions follow the monthly/quarterly results; iii) the effect of macroeconomic variations will be adjusted by the market index (interest rates, inflation, etc.
); and iv) the final analysis will be based on the twenty-four consecutive results, thus allowing a broad view of the desired objectives. 4. ANALYSIS OF RESULTS Starbucks’ (SBUX) performance compared to the performance of the market, represented by the NASDAQ Composite (COMP) index, was analyzed for a continuous period of six years, from 2005 to 2010. For analysis purposes, the period was divided into two sequential subperiods corresponding to the administrations of Jim Donald and Howard Schultz. In the beginning of each period, SBUX and COMP INTERNATIONAL JOURNAL OF BUSINESS STRATEGY, Volume 12, Number 1, 2012
23 indexes were matched (zeroed), and from this benchmark, a follow-up analysis of their accumulated performance was conducted. This procedure was complemented by a survey of the main management actions of managers based on Starbucks’ annual reports. 4. 1 Jim Donald Figure 3 shows the annual share prices of Starbucks (SBUX) and of the COMP index as well as their accumulated variations from January 2005. Only in the second year of Jim Donald’s management did the Starbucks share overcome the market index, reaching its maximum value of US$39. 63 on May 5, 2006.
The year 2007 was terrible for Starbucks because although the NASDAQ Composite index continued to grow, the Starbucks share dropped 37% while the NASDAQ index was valued at an increase of 21%, a 58% difference in the three years of Jim Donald’s management. Jim Donald’s performance as a CEO can be summed up by a few insights concerning environmental and health-focused activities, such as the purchase of Ethos Water, the launching of the recycled paper cup factory, the elimination of fat and the addition of 2% milk in the espresso coffee (Starbucks Timeline, 2009).
4. 2 Howard Schultz When comparing the results of Starbucks with the market, Figure 4 shows the battle fought by Howard Schultz to recover the value of Starbucks shares. In 2008, the financial crisis worsened, and Starbucks saw its worst result when its share price was quoted at $7. 17 on November 20. The recovery started in April 2009, when the accumulated value of Starbucks was able to exceed that of the market. To the satisfaction of shareholders, the recovery process continued in 2010, and Howard Schultz was able to close the year with a share price of US$32.
47, an appreciation of 68%–as opposed to 2%–for the market, which represents a difference of 66% over a period of three years. Starbucks finished the fiscal year 2010 with 16,858 stores, including their own and franchised locations. Howard Schultz proved that he knows the company and the market in which it operates. When Schultz assumed the office again as the CEO in January 2008, he reported the main problems he found: increased competition, a drop in the number of clients, a lack of focus, and a bureaucratic, operationally inefficient institution.
Schultz responded by investing in all fronts, motivated by the prospect of a recovery of the Starbucks experience. He diversified the product offering through innovation. He trained personnel. He renewed the executive staff and invested in technology. He increased the INTERNATIONAL JOURNAL OF BUSINESS STRATEGY, Volume 12, Number 1, 2012 24 company’s social and environmental commitment. Revealing his commitment to results, for the first time in the company’s almost forty-year history, he closed approximately 600 stores in the United States and 61 in Australia.
Schultz was also committed to a more selective process for the opening and licensing of new stores. In 2009, Schultz began reaping the rewards for his work: he reduced costs by US$580 million. He restructured vital areas of the company, such as logistics, information technology, and marketing, ultimately reaching the customer more quickly and efficiently. He launched Via, a soluble coffee with quality and flavor, which became a major sales success. He invested in Seattle’s Best Coffee as a new franchise. When analyzing the Starbucks AR (2010), it is apparent that Howard Schultz continued his work to recover the company.
In further innovative efforts, Schultz made the Starbucks experience more sophisticated, making adjustments in the menu and adapting the offered meals to the time of day as well as to customers’ lifestyles. He implemented the opening of stores in China, a market that he considers the most promising and his main market abroad in the future. He recovered the growth modestly, closing the year with 16,858 stores. 4. 3 Result of Event Studies Table 1 summarizes the main results. From the fourth quarter of 2004, the market model was calculated through an Ordinary Least Square (OLS) regression.
The estimated model was applied to the post-event window, resulting in a CAR calculation from the first quarter of 2005. The procedure was successively applied to 24 quarters, generating the other results shown in the table. The CAR quarterly standard deviation, which generated a CAR/DP that is the standard CAR, was also calculated, allowing the comparison and analysis of the set of constant data in the table. The significance of the results was calculated at a level of 5%. 2 The adjusted R provides evidence and strength for the regressions performed. It is noticeable that only 2
the R from the third quarter of 2005 and from the second quarter of 2006 are non-significant, which was supported by Snedecor’s F. Because the regression expresses a relationship between the price of a Starbucks share and the market, R2 also shows that from the fourth quarter of 2008, the correlation between the two variables was increasingly emphasized. This indicates that investors were placing more INTERNATIONAL JOURNAL OF BUSINESS STRATEGY, Volume 12, Number 1, 2012 25 trust in the company’s stability, as shown by the parallel relationship. Starbucks will vary in the same direction as the market.
A crucial aspect for understanding Table 1 is that the analysis is quarterly. Starbucks’ stock variation has been considered in comparison to the daily variation of the market index, adjusted by the regression of the previous quarter. This is a way to program a normal (expected) result in case an event did not occur—that is, in case the top management had not taken corrective measures. This means that when a positive or negative CAR is checked, it is a consequence of the investors and analysts’ (market) point of view on the possible result of those measures.
A non-significant result is a consequence of decisions that were or were not made and for which the result was interpreted as unable to change the course of the behavior dictated by market variations. INTERNATIONAL JOURNAL OF BUSINESS STRATEGY, Volume 12, Number 1, 2012 26 Figure 5 shows the daily CAR variation from the first quarter of 2005. The horizontal scale indicates the number of weekdays that were missing at the closing of the quarter. The blue line represents the accumulated daily variation of Starbucks’ share, and the red line is the normal expected return.
The normal expected return is calculated by the market model and represents variation as it is influenced by the market. This is an elegant form of adjusting the systematic risk. The space between the two lines is the CAR. It is observed that only in the first days of the quarter did the value of the share follow the normal expected value. From then on, it moved in a negative and definite way, showing that the decisions made by the top management were not welcomed by the market, leading to -25% CAR at the end of the quarter.
In absolute value terms, this is the highest CAR found in all the analyzed periods. TABLE 2 : STRATEGIC DECISIONS IN THE PERIOD H. Schultz Jim Donald CEO Period 2005 2006 Positive 2 1 Non Siniificant 0 1 Negative 2 2 2007 Soma 2008 2009 2010 Soma 1 4 2 2 2 6 1 2 1 1 1 3 2 6 1 1 1 3 Table 2 reveals the number of classified decisions by CEO and by year. It is observed that Jim Donald had two decisions with negative effects per year. For the significant decisions, Jim Donald had a ratio of positive decisions of only 4/10, or 40%, while Howard Schultz had a positive decision ratio of 6/9, or 67%.
This analysis is important in that it reflects the active investors and analysts’ view of the stock market (i. e. , the stockholders who attribute value to the company) (Anthony and Govindarajan, 2002). 5. CONCLUSIONS The following characteristics of Starbucks must be considered. i) It negotiated a premium or luxury product that was also an accessible one according to Alleres (2000). ii) Premium products are for customers who have or seek a higher status, as Krishnamurthi (2001) notes. iii) The quality of a premium product and the status of its consumers strengthen the brand, as Churchill Jr.
and Peter (2001) observe; this was always Starbucks’ rationale. iv) Maslow (1943) explains that individuals, according to their hierarchy of needs, have preferences that follow a determined order of predominance. In the case of Starbucks coffee, which sells at US$4. 00, it is far from a physiological need and is closer to a self-esteem and confidence need; therefore, there is a possibility of its replacement by a lower priced product. v) In a period of crisis, demand for Starbucks tended to vary inversely to its price, as attested by the economic theory cited by Spencer (1979) and Krugman and Wells (2007).
Still, according to Lovelock (1996), Churchill Jr. and Peter (2001), and Krishnamurthi (2001), the problems faced by Starbucks were predictable because of the intrinsic characteristics of its products, its price and distribution channels, and its directors, who should have paid more attention to the conditions of the market or to discontinuities, as highlighted by McManus, White, and Botten (2009). Financial crises affect segments in different ways. In the case of Starbucks, there were strong warning signals, considering the marketing compound and the attributes that add value to the product.
All signs indicated that a financial crisis would seriously affect the company in the event that it lacked contingency plans. A relevant aspect of this analysis is the fact that Howard Schultz had functioned as President of the Board and Chief Global Strategist since the year 2000. Even before the beginning of the crisis, he was an important element in the company’s affairs. Therefore, although Jim Donald proved to be a CEO with a few brilliant initiatives despite having failed on the front line of a crisis situation, one cannot forget that Schultz was permanently behind the company’s major decisions while never revealing his genius.
The financial crisis was felt in the market by October 2007. However, Starbucks felt its effect about a year before, by June 2006, when the company’s continuous devaluation process began. It is important to emphasize that until the end of 2006 and throughout 2007, there was no evidence of incisive reactive INTERNATIONAL JOURNAL OF BUSINESS STRATEGY, Volume 12, Number 1, 2012 27 measures. The impression this gives of apathetic leaders unprepared to deal with the situation was reflected in the sequential analysis of strategic decisions: in 2006 and 2007, Jim Donald had only one positive evaluation.
The crisis was at its worst between October 2008 and March 2009, in the period between the fourth quarter of 2008 and the first quarter of 2009. Yet, the Schultz management had positive evaluations in this period (see Table 2), showing that the market recognized his efforts. Another relevant aspect is that since 1987 when Schultz took over as Starbucks CEO, he had focused his development plan on the opening of stores. The development was frenetic: approximately 15,000 stores in a period of 20 years (before 2007).
The opening of new stores increased sales volume and net results, but it simultaneously disguised structural problems such as store profitability, a drop in demand, and the need for innovation (Starbucks, AR 2004 to 2007). Schultz left his position as a strategist and took over the front line in a critical situation, facing the almost impossible mission of stopping the freefall of Starbucks shares. The continuous devaluation period lasted for 33 months, from June 2006 to March 2009, reaching its lowest point when the Starbucks share was quoted at US$7. 17 on November 20, 2008.
When he took over in 2008 with the goal of reinventing the Starbucks experience, it seemed that Schultz was listening to Krugman’s (2008) advice: “When depression economics prevails, the usual rules of economic policy no longer apply: virtue becomes vice, caution is risky and prudence is folly”. Schultz reacted vigorously on all fronts. During the last three years, it could be said that he modernized and reinvented Starbucks. From Krishnamurthi’s (2001) point of view, Starbucks was able to increase its value to the customer as a way of stimulating demand.
Howard Schultz paid a high price, but it seems that he learned his lesson. In three years, he had to regain focus and restructure the company through new hires and modern technology. Moreover, he had to adjust to new methods of dealing with the public, approve new research and marketing procedures, and place the company in a situation to respond quickly to consumers’ current expectations through innovation. Today, Starbucks is a company that is differentiated and has modern and efficient dynamics.
In the hands of Howard Schultz, the Mermaid resurfaced from the ashes as the Phoenix to reach further shores–probably oriental ones. BIBLIOGRAPHY: Abramo, Perseu. , Research in Social Sciences. In Hirano, Sedi (ed. ), Social Research, Project and Planning, TAQ, Sao Paulo, 1979. Alleres, D. , Luxe: Strategies–Marketing, 1st ed. , FGV, Sao Paulo, 2000. Anthony, Robert N. and Govindarajan, Vijay, Management Control Systems, Atlas, Sao Paulo, 2002. Churchill Jr. , Gilbert A. and Peter, J. Paul, Marketing – Creating Value for Customers. Saraiva, Sao Paulo, 2000. Fama, Eugene, Interviewed by Clemente, Douglas, Nov. 2, 2007; The Reg