Starbucks Performance Management: Strengths & Weaknesses
This paper evaluates the performance management system at Starbucks Corporation, examining both its decision-making and employee development functions. Drawing on 360-degree feedback appraisals and multiple sources including employee reviews and company policy documents, the paper identifies notable strengths — such as competitive benefits, partner recognition programs, educational assistance, and a formal Human Rights Policy — alongside significant weaknesses, including employee dissatisfaction with pay, stressful working conditions, poor training continuity, and feelings of underappreciation. The paper concludes with targeted recommendations for improving training frequency, compensation fairness, workplace cooperation, and employee appreciation programs.
- Introduction: Starbucks and Performance Management: Overview of Starbucks and performance management framework
- Decision-Making Function: Compensation and Benefits: Evaluates pay, bonuses, and benefits structure
- Employee Development: Strengths and Shortcomings: Reviews training, recognition, and partner feedback programs
- Employee Dissatisfaction and Union Formation: Examines grievances and resulting union activity
- Recommendations for Improving the System: Actionable suggestions for HR and management improvements
- References: Full APA citation list for all sources used
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What makes this paper effective
- Balances primary corporate sources (Starbucks policy documents) with external employee reviews, lending credibility to both the strengths and weaknesses identified.
- Grounds the analysis in an established theoretical framework — Pulakos's two-function model of performance management — giving the evaluation a clear academic anchor.
- Moves logically from assessment to actionable recommendations, demonstrating applied HR thinking rather than purely descriptive summary.
Key academic technique demonstrated
The paper demonstrates applied framework analysis: it introduces a recognized theoretical model (Pulakos, 2004) and then systematically applies each function of that model to a real-world case. This technique is common in business and HR coursework and shows how abstract concepts translate into organizational practice.
Structure breakdown
The paper opens with background on Starbucks and frames its analytical lens (360-degree feedback, Pulakos's framework). It then moves through two evaluative sections — compensation/decision-making and employee development — before addressing the consequences of unresolved weaknesses (union formation). It closes with a concise set of practical recommendations, followed by a full reference list in APA format.
Introduction: Starbucks and Performance Management
Starbucks Corporation, founded in 1971 in Seattle, Washington (Shahi, Omar, Aufschlager, Schmerling, & Gassner, 2007, p. 3), prides itself on its exemplary performance management system. The prototypical performance management system focuses on two functions: decision-making, in the form of "pay increases, promotions, transfers, assignments, reductions in force or other administrative HR actions" (Pulakos, 2004, p. 3); and employee development, through guiding the "training, job experiences, mentoring and other developmental activities that employees will engage in to develop their capabilities" (Pulakos, 2004, p. 3). Using 360-degree feedback performance appraisals provided by direct reports, employees (referred to as "partners"), coworkers, managers, and customers (Starbucks Corporation, 2013; Lepsinger & Lucia, 1997), Starbucks' performance management system has many strengths but is also burdened with a few pronounced weaknesses.
Decision-Making Function: Compensation and Benefits
In the decision-making function, Starbucks is strong in that it provides its employees with salaries (Hammers, 2011), bonuses, some free products, and in-store discounts, along with benefits such as health insurance, 401(k) plans, and stock options (Starbucks Corporation, 2013). However, according to several employees, Starbucks pays too little and offers too few benefits relative to the stressful workload and other working conditions — such as unpleasant coworkers and poor managers (Indeed, 2013).
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