Organisational Strategy

Posted on November 15, 2021 by Cheapest Assignment

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Organisational Strategy

 

Introduction:

Costa Coffee is a multinational coffee company that hails from the United Kingdom. It has its headquarters in Dunstable, Bedfordshire and is a completely subsidiary of Whitebread. It happens to be in the second position among the list of large coffee chains in the world succeeding in Starbucks Coffee. Apparently Costa Coffee is the largest coffee house chain in the United Kingdom. The foundation of Costa Coffee happened in London in the year 1971 by the people of the Costa family in the form of a wholesale operation that supplies roasted coffee to the caterers and specialists in Italian coffee shops. It was acquired in the year 1995 by Whitebread and it has been growing to a total of more than 2800 stores across 30 countries. Costa Coffee has more than 1700 restaurants in the UK, more than 3500 Costa Express vending facilities and more than 1100 outlets overseas (Brinkman, Navarro & Harper, 2014). The outlets of Costa Coffee have also been in Australia and they have been liked enormously by the audience too. Being into the business of coffee house chains, it is evident that with each passing day, Costa has been trying to give tough competition to similar brands and putting efforts to becoming the largest brand in the world (Drivers, 2012).

The following report will analyse the generic strategies, the organisational structure and the organisational culture of Costa Coffee in Australia. It will also put some light on the company profile and describe the present status along with providing some critiques to the operation of Costa in Australia.

Demand and Supply of Certain Resources in Australia

Costa Coffee – Company Profile

The Italian immigrant brothers namely Bruno and Sergio Costa were the founder members of Costa Coffee and they found the coffee roastery in Lambeth, London in the year 1971. They initially started supplying roasted coffee to the local people and the caterers. The Costa family then migrated to England in the 1960s and opened up a branch selling coffee in the year 1978 in the first-ever Costa Official store that opened up in Vauxhall Bridge Road of London. In the year 1985 Sergio Costa bought the shares that were owned by Bruno and then Bruno went to find a tableware company (Florin et al., 2015). By the year 1995, the chain of Costa Coffee already had a total of 41 stores in the United Kingdom. By that time, the business of Costa Coffee was acquired by Whitebread that happens to be the largest hotel and operator of the coffee shops in the UK. Costa Coffee celebrated the opening of the 1000th store in Cardiff in the year 2009 and that was one of the greatest milestones that were set by the owners since its inception. In the month of December 2009, Costa Coffee gave an agreement to acquire Coffee Heaven for 36 million pounds that gave addition to 79 stores in the location of Central and Eastern Europe (Eriyagama, Chemin & Alankara, 2014).

Costa Coffee entered the Australian markets in the late 1990s and set up its first store of business in Sydney. Today it has more than 200 stores across Australia in almost all the areas including, Canberra, Queensland, Adelaide, New South Wales and Victoria. Initially, it had to struggle a lot to have a mark among the audience in the Australian market as it happens to be one of the most sophisticated coffee brands. It usually takes some amount of time for such brands to bring the actual culture of coffee in a country and the similar happened with Costa when it entered Australia (Florin et al., 2015). To its misfortune, the Australian market already had the inhibition of Starbucks Coffee before the setting up of Costa Coffee. It then quickly expanded the business in different areas of Australia and was then largely accepted by the people. Initially Costa Coffee concentrated on making the products and services better so that they got better acceptance from the people (Iasevoli & Massi, 2012). Therefore during the time of its inception, it was not liked but with the continuous effort of making it customer-friendly, the experience that the audience gathered with it, paved for the good days of Costa Coffee in Australia. The generic business strategies, organisation structure and organizational culture have been depicted in the following parts of the essay.

Generic Business Strategies of Costa Coffee Australia:

Firstly the Uniqueness in the process of coffee production is a factor that has allowed the great success of Costa Coffee in the market. It is all because of the fact that it has its own Roastery plant in place of Lambeth in the UK that is completely used for the production of roasted coffee and coffee beans. The initial stages of preparing “Mocha Italia” includes the slow roasting of the coffee beans manually with the rare blends. The following process includes the grinding of the coffee beans to ensure the pure quality and flavour of the coffee. It is then put into the espresso machine to make sure of a perfect blend of flavours (Kasim & Dzakiria, 2015). Lastly, the excellent quality of customer service and the use of handmade skills makes it unique from all the other brands of similar products. The old fashioned and traditional ways of brewing technology make sure of creating the own unique preparation method and standing out of the crowd (Knight, 2012).

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Image building and social responsibility is another step taken by Costa Coffee in the form of generic business strategies. The selection of good and accessible locations for a store with superclass standards, the luxurious culture of coffee, comfortable ambience and well-maintained facilities focus on maintaining a good image of the company. In the markets of Australia, Costa Coffee has not done a lot of advertising and media promotion but they have attained popularity with the reputation that they already had from the other countries. Costa coffee Australia believed that the brand name that they possess is enough to build customers in the communities and hence they only made low budget advertisements in the past decades and only in the year 2000 did they have the introduction of high-end promotional strategies and expansion. In the year 2005, Costa promoted the fresco, gift cards, memberships and similar offers (Matthews & Brueggemann, 2015).  Later in the year 2007-10, Costa expanded the coffee shops in the other parts of Australia and became more visible in the country. Teaming up with Rainforest Alliance provided them with growth and sustainability to stand in the industry (Notarnicola, 2015).

Target Market additionally has always proved to be a positive aspect for Costa Coffee Australia. Because of the location and strategies used for the production Costa Coffee Australia has a hugely diversified target market in a variety of people. The large variation in the target market comes with the variation in ages, gender, choices and other demographical features (Quelch, 2015). But the locations of the Costa Coffee Australia stores have always proved to be potential factors leading to high business and profits. It mainly targets the youth and couples. Therefore it has been successful in reaching out to 45% of the sales going to the youth (Schreiber, 2013).

The product lines and pricing strategies used during the inception of Costa Coffee Australia came up with the introduction of a wide range of the finest coffee blends that included hot chocolates, tea, coffee, latte, espresso, cappuccino, iced tea, fresco, mocha and ristretto. In the subsequent years, there was the introduction of chocolates, cakes and brownies too. The variation in the products offered the services to a wide market that is differentiated by the ages, food preferences and prices (Tamaki, 2013).  Because of the fact that the prices fixed for the different products are generally high, the market has been concentrated to the upper classes and the privileged classes of the society only. It is thus a coffee house chain for the elite classes.

Organisational Culture – Costa Coffee Australia

The organisational culture adopted by Costa Coffee Australia happens to be one of the most relevant aspects.  The organisational culture of a firm puts its influences the performance that the company has and the employees too. When it comes to Costa Coffee, Australia, the organisational structure enters deeply into the aspects of the business operations.  It can be evidently seen from the coffee houses of Costa (Terry & Di, 2013). The culture in Costa shows the way the company functions and the way the employees work in the workplace.  The organisational culture of Costa Coffee is in relation to the strategies that are useful to expand the company to a global extent (winter, 2012). The dimensions of the organisational culture adopted in Costa Coffee can be described in many ways after dividing them into different types.

The main divisions of the culture are as follows:

  1. Priority to the employees first:

The culture used by the organisation is featured relevantly by the fact of prioritising thee employees at first. Under this approach, the leaders, managers and corporates of the firm ensure that all the workers and employees of the company have their demands fulfilled. It is checked that the employees get the chances of being provided with fair chances to see growth and development in the company (Schreiber, 2013). They are provided with all kinds of perks and incentives so that the motivation to work is maintained well.

  1. Healthy bonding approaches:

Costa Coffee Australia is driven by the culture of building healthy relations with consumers. The purpose is served by the practice of greeting every new visitor with open arms and then providing them with what they are looking for with decency. Everyone who would visit a store of Costa Australia or anywhere in the world is first greeted warmly and then treated well so that they have a good experience with the coffee house chain (Kasim & Dzakiria, 2015). Each and every consumer of the company is treated equally and this is hence a positive aspect of the Costa family.

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  1. Freedom of expression for the employees:

Initially, when it opened up, the employees of Costa Coffee Australia were not allowed to speak up their minds. They used to keep the minds brooding with the inner feelings and guilt. But later the phenomenon was completely changed and the employees were given the chance to speak up whatever they wanted to say (Iasevoli & Massi, 2012). This allowed the employer to know the needs and demands of the workers and then work accordingly so that they could work better.

  1. Communication platforms:

The employers allowed the workers to have communication platforms where they could speak their demands. These wishes and demands were listened to and then worked upon motivating them to work effectively.

  1. Providing training to the junior workers:

The provision of training to the juniors and newcomers in the stores of Costa Coffee Australia is one of the major organisational cultures that are followed significantly. Under this, the new entrants and the juniors are trained to have the necessary etiquettes needed for an employee (Schreiber, 2013). They are trained to have proper organising capacities and fulfil the requirements of the managers effectively. Finally, they are trained to greet every visitor in the store and treat all of them equally.

Initially, it was impossible for the management team of Costa Coffee Australia to be able to differentiate the British culture and adopt the Australian culture.  When it began the venture in Australia, it was to take up the Australian culture but coping up with it was difficult.  Understanding the actual demands of the people was literally impossible and hence the drinking culture of Australia took time to sink into the management (Terry & Di, 2013). This was the actual reason why Costa failed to serve the people well during the initial days of its inception. Later with the passage of time and the process of learning from the failures, it became convenient for the company to function well and in the way that was desired by the audience.

Organisational Structure – Costa Coffee Australia:

Costa coffee is the second largest coffee house chain in the world after Starbucks coffee. It has been placed in such a high position due to the proper functioning and coordination between all the organisational structures in it. The organisational structure of Costa Coffee has its influence in the leadership, communication, changes and managerial factors necessary for success. The organisational structure complements the working of the company and thus it has reached sky-high (Schreiber, 2013). The organisational structure has a combination of many factors together. The main features of the organisational structures can be described below.

Attracting and Retaining Workforce

  1. Structure for the functionality:

This feature of the structure of Costa Australia is concerned with the functions of all the departments of the company.  As an illustration, any company would have the departments like human resources, revenue, marketing and finance and administrative department (Notarnicola, 2015). The functional structure of Costa is responsible to check if there is integration and coordination among all the departments of the company or not.

  1. Department of the production:

This department is concerned with the manufacture of the products from the firm. Costa Coffee is a coffee house chain that has similar related products and the products department will look into the proper and meticulous management of the manufacture of the products. It will also take care of the fact that the products are of the required quality and will be liked by the audience.

  1. Department looking into the business in the other places:

This department looks into the matter of business in places other than the local hubs. The department looks into the kind of business that is being generated overseas. Costa Coffee is also found in the places like United States of America, Europe, Africa, Russia, Asia and the Middle East. Every managing head would be responsible for informing the functional in-charge of the particular place about the business strategies (Matthews & Brueggemann, 2015).  This allows the equal distribution of labour thus making it easy to manage such a huge organisation spread over all the areas to function smoothly.

  1. Teams and groups formed for the non-administrative work:

Costa Coffee has a tradition of forming a team that would look into the non-administrative functions of the company. This team helps in providing training to the employees about the etiquettes and behaviour. It makes the stores look good and takes the responsibility of attracting more audience to itself (Iasevoli & Massi, 2012).  It looks into the ways to advertise Costa better and promote the brand more so that the amount of business increases as a result of it.

All these structures in Costa Coffee Australia help in the proper functioning and effective marketing of all the products. It helps in making it a famous brand too.

Conclusion:

When it comes to Costa Coffee, it is basically the coffee and the beverages that are talked about. It has since its inception proved its quality and customer friendliness. Being an internationally reputed company, it has expanded its business in many countries but during the initial phases in Australia, it faced a lot of issues. The above report has a description of all the issues that it faced (Eriyagama, Chemin & Alankara, 2014). The analysis of the above along with the analysis of similar points will be helpful for the company to open up its business in new countries. Basically, it is required to know the market and the people before starting a venture in another country. Hence as seen from the present day scenario, Costa Coffee is performing well in Australia as it has known the audience and the culture.

Factors influencing the job satisfaction in Wesfarmers, Australia

References

Brinkman, J., Navarro, I. and Harper, D., 2014. Unlocking the business environment. Routledge.

Drivers, I., 2012. Addendum to the Business Section: The Drivers and Barriers that Shape Business Engagement in Certification. the Final Report of the State-of-Knowledge assessment of Standards and Certification, p.181.

Eriyagama, N., Chemin, Y. and Alankara, R., 2014. A methodology for quantifying global consumptive water use of coffee for sustainable production under conditions of climate changeJournal of Water and Climate Change,5(2), pp.128-150.

Florin, N., Madden, B., Sharpe, S., Benn, S., Agarwal, R., Perey, R. and Giurco, D., 2015. Shifting Business Models for a Circular Economy: Metals Management for Multi-Product-Use CyclesUTS, Sydney.

Iasevoli, G. and Massi, M., 2012. The relationship between sustainable business management and competitiveness: research trends and challenge. International Journal of Technology Management58(1/2), pp.32-48.

Jacobsen, M., 2013. The Business of Creativity: An expert guide to starting and growing a business in the creative sector. Harriman House Limited.

Kasim, A. and Dzakiria, H., 2015. Challenges of Collaborative Partnership in Developing a Sustainable Nature-Based Tourism in LangkawiCollaboration in Tourism Businesses and Destinations: A Handbook, p.205.

Knight, H.J., 2012. Patent strategy for researchers and research managers. John Wiley & Sons.

Matthews, C.H. and Brueggemann, R., 2015. Innovation and Entrepreneurship: A Competency Framework. Routledge.

Notarnicola, A., 2015. Global inclusion. Changing companies: strategies to innovate and compete: Changing companies: strategies to innovate and compete. FrancoAngeli.

Quelch, J.A., 2015. Consumers, Corporations, and Public Health: A Case-Based Approach to Sustainable Business. Oxford University Press.

Schreiber, D., 2013. The Voluntary Carbon Market and Business Innovation for Sustainable Development.

Tamaki, R., 2013. Consumers’ perception of fair trade coffee in Australia and Japan.

Terry, A. and Di Lernia, C., 2013. Quasi-franchising: a new model for strategic business cooperation. In Network Governance (pp. 269-286). Springer Berlin Heidelberg.

Winter, G., 2012. First Be Nimble: A Story About How to Adapt, Innovate and Perform in a Volatile Business World. John Wiley & Sons.

 

 

 

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