Following Starbucks' Example

Starbucks' global corporate goal is to become the leasing coffee seller and brand in each of its expansion targets. They aim to do this through their finest quality coffee and other products, and by means of their high-quality customer service. Right now, Starbucks is known around the world but its expansion plans are still not finished. The company seems to be invincible and promising in the coffee industry right now as it already has 6,000 outlets in 28 countries with 1,200 of them are internationally situated. Starbucks' expansion dreams as it is currently known in three continents have come true. The success of the company in China is an exemplary example of how a Western company can triumph over cultural obstacles especially in the Eastern/Oriental part of the world. While China never even recognized a "coffee culture" a few years ago, now, they even acquired the "Starbucks culture". This coffee shop, which causes cultural concerns in Italy because of threatening to change the Italians' lifestyle of drinking coffee while walking in the streets or relaxing, has been successful in its endeavors to globalize its products.

True, the company experienced several downturns because of cultural issues but it triumphantly gained a name for itself in the global market, especially in China. How did Starbucks able to comeback from its failure? Why did they fail in the first place? How important is it to understand cultures of other countries in globalization? These, we shall answer in the course of this paper. What follows is an enumeration of the cultural barriers that Starbucks encountered in its expansion in China.

The Problem

The reasons behind most corporations' expansion and globalization are strategic growth and profits. Starbucks is not exempted from this fact. However, Starbucks was in a moment taken aback by the consequences of globalization. Patriotism and differences in culture and heritage which may affect the quality and consistency standards of products were ever present in its expansion in China.

Though China represents great opportunities because of its big population and impending growth, coffee is never of Chinese traditions. Coffee was considered as a Western commodity and doesn't go well with Chinese food, cultures and traditions, tea of course sounds a lot better. The fact that the Chinese sees the United States as a major economic competition and a potential enemy helps cloud the issue.

The Solution

Cultural problems cannot be solved overnight; thus, Starbucks dealt with them slowly but surely. Rather than exerting efforts to accomplish rapid changes by making the Chinese market follow the company's own culture and business practices, they took an "act local, think global" attitude. The company believes in achieving success through long-term plans and operations. Being experienced in globalization, Starbucks set diverse strategies in each nation/market to make the every Starbucks experience an integral part of the county's culture. The company even showed adaptation of Starbucks products to Chinese standards and culture by producing its own Starbucks moon cakes.

However, it doesn't really mean that China wholly accepts the Starbucks coffee culture. The Chinese may just want to try out new things or show that they are financially capable since Starbucks' price is not affordable for average customers. Thus, Starbucks still has a long way to go to prove that it is already part of the Chinese culture instead of just being a fad.

Reasons for Cultural Issues on Globalization

For many people around the world, the globalization of goods and services from other countries is a most welcome event since it would allow them access to products that are not found in their own country. However, there are trade-offs in this kind of developments. One is changes that are influenced by globalization might threaten the feasibility of the local production; meaning, foreign products and services, which are sometimes much cheaper, might displace the current local producers of the host country. Another issue however has a greater impact in the society, which is the possible disruption of the country's cultures and traditions. This issue is of course applicable to both the host nation and the globalizing corporation; the former is when exposure to foreign products may change the country's culture, value and tradition, the latter is when the company resolves to adapt to the cultures of the host country, losing its culture in the process in exchange for profits.

Cultural issues in the context of globalization are not mere nightmares, they are sad realities that every company who wants to become multinational and global. The reasons why these issues continue to exist is the fact that every country has the ethnocentrism way of perceiving things not only in its economy but also in its social and cultural aspects. No matter how good the product is, no matter how famous the company has been in other countries, the bottom line is, if it threatens the culture of the host country, it is considered as an enemy of the nation, especially in a conservative country such as China.

Culture is being represented in various shapes and sizes. It spans areas (and bigger pictures) such as politics, history, behavior, faith, mentality, and lifestyle. People around the globe come from different world views and experiences which makes cultural clashes inevitable. This differences result to issues such as requiring cultural sensitivity in doing business across borders. This simply means that a sense of empathy, flexibility and creativity informed by cultural knowledge is needed to overcome cultural issues on globalization.

Recommendation

This cultural issue in the context of expansion has been around since the start of globalization and until now, coping up with the differences in culture is a widespread problem. A company is of course concerned with this issue as it plans to expand to other nationalities and territories. Thus, by studying both the failure and success of Starbucks, a company could see things more clearly.

A company, depending on its expansion locations must draw up an efficient plan for globalization; and this can be greatly achieved through researching the country's cultures and beliefs and then try to cook up ways to introduce its products and services without offending the host country. The company must also try to incorporate the cultures of the host country with its own through understanding them and not criticizing them. It is not advisable however to completely replace their own culture with the other nation's. Also, a company must try to identify the different management styles that are applicable to every country as well as the importance of knowing and learning the language and traditions of the host country. Furthermore, the following steps could be of great help to an expanding company:

• Learn about the status of the business in other countries - the company could go to other countries' websites and check out the industry's current activities, including the atmosphere, attitude, and angle that the business has. The company must remember that each country will have its own culture, personality, and way of doing things.
• Observe the country and the industry - the company must not let observation skills be flooded with so much information or become unfocused. The company must go to the country and notice how people act, dress, and treat each other. Also, messages that are conveyed without being said are very important.
• Ask pertinent questions - the company must not limit their ability to work in other cultures. Asking questions would show interest and this interest helps build relationship. Questions could demonstrate that the company is working to create synergy with the host country's cultures.
• Stay focus and aware of the company's goals - the company must not get lost in other country's culture. It must not forget that uniqueness and originality is still a major factor in globalization.
• Take time, don't haste and waste - Working across cultures takes time. The company must consider that communication may be slowed down and logistics may be different or more so, the country might have a different concept of time altogether. The company must also give itself more time to process all the information it gathered before making any decision.
• Individual difference is inevitable - As if the problem in the differences in different countries is not enough, individuals may have values that vary greatly from those of their native culture. The company must be aware then that people's behaviors are influenced not only by their culture, but also by their background, experiences, and personality.
• Tolerate uncertainty - Directness and exactness are good values but this must be lessened when dealing with other countries. Exact and concrete answers may not always be readily available especially in cultures with a high tolerance for uncertainty. The company must focus on bigger pictures and try to let go of minor details that are somewhat vivid.
• Build inter cultural skills - Communication skills and business strategies which may be applied across cultures are extremely important in globalization. The company must then further its inter-cultural competence based on certain situations and needs.

Starbucks is indeed one of the most successful companies in the global market and it is so because it was able to battle the issues of culture, not really without a scratch, but with the heart of a survivor. An expanding company, in order to achieve the tremendous success that Starbucks is enjoying right now must learn from the lesson that every culture in every country is unique on its own. No company must try changing a nation's culture or try eliminating it and replacing it with its own. Rather, the company must be yielding enough to the differences yet firm enough to uphold its own culture and beliefs.

References

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