3. Do you think that Starbucks has grown rapidly because of its ethical and social responsibility activities or because it provides products and an environment that customers want?

To understand how Starbucks takes care of customers and the role of that management in its achievement, we need to look at the history and growth of Starbucks as a corporation. The first stores did not distribute coffee drinks. They were vendors of fresh-roasted coffee beans, exotic teas, and seasonings. Every now and then the person behind the counter would prepare a pot and dole out free samples in Styrofoam cups (Badaracco & Webb, 2009).

Until the end of the 1970s, Starbucks had five retail stores, a mail-order division, and a wholesale group. Sales were two million dollars annually. Schultz, who is now chairman and CEO, was hired by Starbucks in 1981 as director of retail business and marketing.

Schultz had been with Starbucks for just about one year when he went on a trip to Milan to take part in a trade show. While strolling the streets of Milan from his lodge to the trade show, he had the characteristic flash of industrial or strategic brainstorm that was eventually the foundation of Starbucks' triumph. Expressly, he was in awe at the ubiquity of the cafes and bars in Italy. After a few days, he started to be attracted into them because "it was so quixotic."

Schultz depicts his experience: "I encountered the same faces and the companionship. The coffee bar was an expansion of people's residences and was beyond doubt part of the structure of the Italian society. It struck me right across the head: this is something lively and extraordinary" (Bollier, 2006).

In particular, Schultz's main strategic insight was being familiar with that the merchandise, which is to say, the...

As a substitute, the produce was the experience and ambience provided to the client visiting Starbucks, ostensibly to buy a coffee beverage but in reality to go there to partake in a cafe setting. This was the concept Schultz introduced back to the United States and portrayed on to reimagine Starbucks and generate a new business market (Badaracco & Webb, 2009).
The phrase he gave to this concept was "the third place." It was in reference to the physical spaces in people's beings (Bollier, 2006). The primary place was their own residence; the second was where they went for their job. As imagined by Schultz, the third place in an individual's life would be the Starbucks coffee shop, where he or she could partake in a sense of social interface, while taking pleasure in a delicately brewed cup of coffee, a cappuccino, or a latte.

From this thesis, it should be clear that Starbucks' triumph is attributable not to their ethical and social responsibility but instead to the relationship it has fashioned with customers. The company does not look at the vending of coffee as a business. As an alternative, its "merchandise" is the ambiance and environment.

Starbucks' achievement is based on a variety of factors, among them having customers perceive its stores as an important place in their beings (the "third place"). This does not occur by bricks and mortar only.

Works Cited

Badaracco, J. And P. Webb. "Business Ethics: A View from the Trenches." California Management Review, Vol. 37, 2009.

Bollier, D. "Aiming Higher: 25 Stories of How Companies Prosper by Combining Sound Management and Social Vision." The Business Enterprise Trust, AMA-COM, American Management Association, New York, NY, 2006.