TKS Session 23: Harvard Business Case: Starbucks + Velocity Session 13
This post is coming a little late to you guys, but I’ve got a couple of things on the go, which you will be fully updated on in this month’s newsletter!
After a couple of weeks, we are back at it! I attended the TKS Sunday session, and we got right into it. For velocity, we did a little recap of our past couple of weeks. I am finishing up the review phase by replanning my video as well as getting into the idea phase of my focus and have begun building stuff that real companies working on phage therapy are focusing on. After a little recap, we took a look at what types of careers a person can get in the world. We looked at it like a pyramid, where each level was a different kind of job someone could get. It sort of looked like this:
Top layer: Activators: Smart people who lead other smart people
2nd layer: Researchers: Smart people working on smart things
3rd layer: Smart people working on stupid things
——————-(this is usually the divide between jobs)————————————————————————
4th layer: Skilled people: People who have developed skills in average jobs
5th layer: Somewhat skilled people: People who are working jobs requiring minimal skill
Bottom layer: Unskilled people: People who are doing jobs that require no skill
Normally, people get jobs at the 5th - 4th layer, even the 3rd layer. But, to make a real difference in the world, you need to be striving for a job in that 1st - 2nd layer, depending on the kind of person you are as well. Those in the 1st layer want to lead people and help guide a team to greatness, while those in the 2nd layer may not want a leadership position but still want to make a difference by being part of that team.
Before getting into the bulk of this session, we did a little look at the MotW, compounding. The idea of compounding is to get 1% better every day by fixing/altering your habits and environments to support you in that. This can lead to long-term results that can have a big impact on your life if you have the patience to keep striving to get better every day.
We then got into the session for this week, where we got to work on a real Harvard Business Case (HBC). What’s really cool about these cases is that there is no question to answer; you have to come up with the questions and answers based only on what is given to you in the case. Your goal is to read the information and synthesize it, then come up with a recommendation based on what you think is most important to focus on from the case. That means that your recommendation will probably be different compared to someone else’s recommendation, and that’s ok because there isn’t one right answer.
The case was about Starbucks beginning a new wave of expansion in China to possibly reach a new market. After reviewing the case on our own, we got together and came up with a statement for the case, which is what all the data we pull will help us focus on when crafting a recommendation.
Statement/question for the case: Should we keep expanding/growing in China? If so, how?
In order to begin trying to recommend an idea, there are 3 pieces of information we need to try to gather from this case:
Starbucks’ current growth numbers in China (internal information, meaning within the company)
Competitor growth/market (external information, meaning outside of the company)
Demand growth (external)
These are all quantitative data points that we needed to collect. There were also qualitative/quantitative data we could focus on, including:
Consumer practices
Factors hindering growth
Economic/political factors
Overall Starbucks success/growth outside of China
Culture in China
Economy in China
I won’t get too deep into the numbers, but we had to look through the paper to find data about those three main points because those were the most important pieces of information we would need to get in order to have a good place to start when creating a recommendation. Sometimes, the “answers” were easy to find in the case. There were parts in the writing of the case and in the exhibits section that showed data about Starbucks’ growth in China from 2014 - 2015, both company-operated and licensed businesses. However, there were discrepancies in the labelling of the exhibits, so we had to determine which was which. Also, for trying to find competitor growth, sometimes we had the answers, but sometimes we had to make assumptions based on what we already knew, which is common to happen in a case study because you may not get all the required information in that case alone.
We then took a pause in the case for a break, where I got to share the IKEA pitch deck our team had created with the rest of the cohort! I went through it to show them what some of our strategies were when crafting it. Then, we got back into the case study.
So, what we ended up doing was finding Starbucks’ current growth numbers in China to see if they were capable of continuing to grow and if their growth goals (3400 stores by 2019) would be achievable. We then compared Starbucks’ growth numbers to those of their competitors to see where Starbucks stands for growth in China compared to other competitors. Lastly, we looked to see what the demand for coffee (Starbucks’ main product) was and if there was an increase in the coffee market in China, to see if it would be wise for Starbucks to invest time growing in China.
In the end, we found that it was very reasonable for Starbucks to reach its growth goals by 2019 and that growing in China was smart because there was an increase in coffee production from 2014 - 2015, suggesting there was coffee demand growth.
This session was really great because I got to use my analytical skills in a business situation rather than working with emerging tech like we normally do. It helped me get exposure and learn about real-world skills that can be applied across many fields, as well as learn some of the ways to go about calculating these kinds of numbers/data points and why that’s important.
This week was a little hectic, but I can’t wait to update you all in this month’s newsletter, so stay on the lookout for that!
