Wednesday, October 13, 2010

Starbucks: Better Drinks, Longer Lines?

Starbucks has announced some changes in the way it makes coffee drinks in an effort to enhance quality, reduce errors, and increase consistency over time and across locations. For instance, the firm has instructed baristas to not make more than two drinks at a time, to steam milk for each drink individually (as opposed to making a whole pitcher and using for multiple drinks), and to use only one espresso machine at a time. Today's Wall Street Journal reports that some baristas worry that the wait times could increase.

As a frequent Starbucks customer, I certainly applaud the efforts to enhance consistency and quality. The quality vs. speed issue raises some interesting questions though. In many ways, Starbucks has two types of customers. Some devoted fans are coffee aficionados who care about quality above all else. Others are more "casual" coffee drinkers who place a priority on speed, particularly in the morning on their way to work. Starbucks wants to maintain its brand credentials with the coffee aficionados, and thus it's taking these steps to enhance quality and consistency. On the other hand, a large stream of revenues comes from the "less expert" customer who just wants their drink quickly. To some extent, meeting the needs of one subset of customers may come at the expense of the other. Many companies face this type of tension as they grow from their original differentiated niche strategy toward a mainstream brand.

Now, the article today also mentions though that Starbucks has been working on many process re-engineering efforts to reduce waste, eliminate unnecessary steps, and streamline key processes. All these efforts may have the "double benefit" of increasing quality and enhancing speed. To the extent that these efforts prove successful, Starbucks customers may not face longer wait times. What Starbucks seems to be doing is slowing the baristas down in a few key areas where it can really enhance quality, while trying to offset that impact on wait times by eliminating other steps and processes that do nothing to contribute to increased quality. If it works, everyone wins - Starbucks, its baristas, and its customers.

1 comment:

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