What were the most important factors behind Starbucks decline in 2007 and 2008?

Individual case assignment guidelines
Starbucks Coffee Company: Transformation and renewal
Syllabus guidance

The individual assignment must be approximately 2,500 words written from the perspective of the
decision maker plus optional appendices on a decision situation. A student’s work must be clearly
supported and appendices must be referenced within the text to be considered valid components of the
report. References should be limited to the case, lecture materials, and readings (including those
assigned prior to the case’s due date). The assignment will be evaluated based on the extent to which
the guiding questions are addressed, the coverage of relevant course and case material, the quality and
soundness of responses to the questions, and the clarity of the report.

Additional guidance
Your submission should provide the following types of analyses (this list is not comprehensive):
• an external analysis of the industry environment to understand the firm’s competitive position and
opportunities;
• an internal analysis of the firm to identify its resources, capabilities, and core competencies;
• an analysis of the fit between the firm’s competencies and its strategic choices;
• an analysis of the organization’s design (structure, people, rewards, and processes for decision
support), and its offshoot (culture);
• an analysis of the alignment among the elements of organizational design; and
• an analysis of the strategic leadership of the firm.

Guiding questions

These questions are provided to help structure your analysis of the case — DO NOT ANSWER THESE
QUESTIONS. Think about these questions as you read and understand the issues facing the firm and the
alternatives available.

1. What were the most important factors behind Starbucks decline in 2007 and 2008? How much of
this did Schultz see in 2007? In 2008? Which factors were less obvious?

2. What were the most important aspects of Starbucks transformation? Why did these matter to the
survival and transformation of the company? How generalizable are such initiatives in the broader
context of business turnarounds?

3. What do you think Schultz means when he says that Starbucks is “redefining the role of a for-profit
company”? What do you make of Schultz’s take on corporate responsibility, and its impact on the
bottom line?

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