Foster students brew up delivery solutions for Starbucks

Guest post by Josina Garnham, experiential learning manager

The warm chocolatey-caramel notes swirling through the air is what you notice first–often times before you even open the door. When you do enter the storefront, you are enveloped by the sound of well-selected jazz, the buzz of the espresso machine and the friendly baristas calling out the names of customers and their made-to-order beverages.

Starbucks, a ubiquitous brand globally and especially here in Seattle, is seeking to extend this experience from their stores to meet its customers’ just-in-time demands. Graduating seniors from the Foster School were invited to join Starbucks in developing solutions on how to deliver fresh beverages without compromising on quality and maintaining the company’s value of “delivering our very best in all we do.”

Each quarter the Foster School partners with a Seattle-based company to develop a customized business case as part of a required capstone course (MGMT430) for all graduating seniors. The case, written by Anna Fung, Foster PhD student, and overseen by Rick McPherson, course coordinator, presents an urgent business issue in a condensed format. The Foster Strategy Development Case Competition is one of the largest single-day case competitions in the world. This winter’s competition with Starbucks featured 54 teams comprised of over 225 students.

For Dave Twehues, director of Global Corporate Strategy, the decision to partner with the Foster School was an easy one: “I think the value of the case competition from Starbucks is twofold. First, the participation of our partners as judges is a great way for Starbucks to connect with future business leaders and second, the exposure to the creative solutions delivered by the student teams brings fresh perspectives to really difficult business problems.”

To develop a winning solution, the students focused on Starbucks’s mission and values: “To inspire and nurture the human spirit – one person, one cup and one neighborhood at a time.” Madeline Sykes, a senior finance major, noted, “it is important to do research on the company’s values and we knew Starbucks values its customers very highly. We started off our presentation by presenting a story about a target customer and the customer’s needs.”

Student teams have three weeks to research the issue and prepare presentations summarizing their recommendations to business leaders—both Foster alumni and Starbucks employees who serve as judges. For Matt Hansen, an accounting major, “the Q&A section…is the hardest part to prepare for. This is one area that our team spent a lot of time focusing on because it is where groups can differentiate themselves by their ability to think on their feet and shows how confident they are in their business proposal/strategy.”

The winning team of Renee Chiang, Allison Gaylor, Matt Hansen, Rebecca Ruh, Kamal Sohal, and Madeline Sykes proposed meeting the challenge of delivering Starbucks beverages with the solution of creating smaller satellite “stores” which would focus on preparing drinks for delivery exclusively. Current stores maintain a brisk business with customers walking in the doors. The student’s research—including frequenting area Starbucks cafes—led them to hypothesize that increasing demands on these storefronts for delivery orders would slow service in both areas. From these small-scale, delivery-focused beverage outlets, bike messengers would be deployed to deliver both hot and cold drinks in specially designed temperature controlled bags.

Beyond understanding the company’s values, having a strong situation analysis, well-justified idea, and presenting their solution in a clear and compelling way, what really differentiates teams are their interpersonal dynamics. Ruh said, “Our success in the case competition was rooted in the relaxed, yet focused environment we created. Our vision developed alongside our team synergy. Taking this experience into the future, the strengths of lightheartedness and creativity, are key components that will define future teamwork endeavors, essential in today’s business world.”

“What I learned about teamwork and team dynamics I will definitely…take with me to my future career” said Renee Chiang. “This was my first time participating in a case competition and it taught me to be confident with myself and my ideas. That confidence would definitely be something I hope to apply to my career—from negotiation to pitching my ideas.”

On March 18, 2015 Starbucks announced the launch of delivery services in Seattle and New York City. Foster School of Business students will be amongst the first to be delighted by having a perfectly prepared, hand-delivered cup of coffee to fuel their last quarter of studies before graduating in June.

To learn more about previous Strategy Development Case Competitions please see our competition webpage and the following Foster Unplugged posts: Alaska Airlines and
Seattle City Light