Starbucks Corporation Starbucks Coffee Company uses its organizational structure to facilitate business development in the global coffee industry. As the largest coffeehouse chain in the world, the company maintains its industry leadership partly through the appropriateness of its corporate structure.
Starbucks evolves to ensure that its organizational structure matches current business needs. This structure fits within conventional typologies of organizational structures. Similar to the case of other multinational organizations, the company employs its structural characteristics to ensure that its operations are streamlined and properly managed.
Starbucks Coffee Company supports its competitive advantages through the characteristics of its corporate structure.
Through the effective design and development of its organizational structure, Starbucks Corporation keeps growing despite competitive pressure from these firms in the international market. Starbucks has a matrix organizational structurewhich is a hybrid mixture of different features from the basic types of organizational structure.
In this case, the structural design involves intersections among various components of the business. Functional Hierarchy. For example, the company has an HR department, a finance department and a marketing department.
This characteristic is hierarchical. The functional hierarchy of the corporate structure facilitates top-down monitoring and control, with the CEO at the top. Geographic Divisions. Also, in the U.Investopedia Video: Understanding A Company's Corporate Structure
Each geographic division has a senior executive. In this way, each local manager reports to at least two superiors: the geographic head e. Corporate HR Manager. Each division head is given flexibility in adjusting strategies and policies to suit specific market conditions. Product-based Divisions. Starbucks has product-based divisions in its organizational structure.
These divisions address product lines. For example, the company has a division for coffee and related products, another division for baked goods, and another division for merchandise like mugs. This feature of the corporate structure enables Starbucks to focus on product development. In this way, the company develops and innovates its products with support through its organizational structure. Such development provides competitiveness that the business needs, especially in considering the threats identified in the SWOT analysis of Starbucks Corporation.
However, teams are most visible at the lowest organizational levels, particularly at the coffeehouses. Team effectiveness is a major determinant of the financial performance of franchised locations and company-owned coffeehouses. However, the ones enumerated above are the most significant in shaping strategic management decisions in the business.
Also, different levels of the organization are responsible for maintaining the integrity of the corporate structure. Starbucks Corporation reforms its organizational structure over time. Bythe company was expanding rapidly, such that it shifted focus away from customers and toward strategic global expansion. However, the business experienced significant decline in sales in that year.
This decline was worsened because of the lack of focus on customer experience.Of all the decisions you make when starting a business, probably the most important one relating to taxes is the type of legal structure you select for your company.
Not only will this decision have an impact on how much you pay in taxes, but it will affect the amount of paperwork your business is required to do, the personal liability you face and your ability to raise money. The most common forms of business are sole proprietorship, partnership, corporation and S corporation.
A more recent development to these forms of business is the limited liability company LLC and the limited liability partnership LLP. Because each business form comes with different tax consequences, you will want to make your selection wisely and choose the structure that most closely matches your business's needs.
If you decide to start your business as a sole proprietorship but later decide to take on partners, you can reorganize as a partnership or other entity. If you do this, be sure you notify the IRS as well as your state tax agency. Sole Proprietorship The simplest structure is the sole proprietorship, which usually involves just one individual who owns and operates the enterprise. If you intend to work alone, this structure may be the way to go. The tax aspects of a sole proprietorship are appealing because the expenses and your income from the business are included on your personal income tax return, Form Your profits and losses are recorded on a form called Schedule C, which is filed with your The "bottom-line amount" from Schedule C is then transferred to your personal tax return.
This is especially attractive because business losses you suffer may offset the income you have earned from your other sources. As a sole proprietor, you must also file a Schedule SE with Form You use Schedule SE to calculate how much self-employment tax you owe.
Starbucks Coffee’s Organizational Structure & Its Characteristics
The federal government permits you to pay estimated taxes in four equal amounts throughout the year on the 15th of April, June, September and January. With a sole proprietorship, your business earnings are taxed only once, unlike other business structures. Another big plus is that you will have complete control over your business--you make all the decisions. There are a few disadvantages to consider, however. Selecting the sole proprietorship business structure means you are personally responsible for your company's liabilities.
As a result, you are placing your assets at risk, and they could be seized to satisfy a business debt or a legal claim filed against you. Raising money for a sole proprietorship can also be difficult. Banks and other financing sources may be reluctant to make business loans to sole proprietorships.
In most cases, you will have to depend on your financing sources, such as savings, home equity or family loans. Partnership If your business will be owned and operated by several individuals, you'll want to take a look at structuring your business as a partnership. Partnerships come in two varieties: general partnerships and limited partnerships.
In a general partnership, the partners manage the company and assume responsibility for the partnership's debts and other obligations. A limited partnership has both general and limited partners. The general partners own and operate the business and assume liability for the partnership, while the limited partners serve as investors only; they have no control over the company and are not subject to the same liabilities as the general partners.
Unless you expect to have many passive investors, limited partnerships are generally not the best choice for a new business because of all the required filings and administrative complexities. If you have two or more partners who want to be actively involved, a general partnership would be much easier to form.
One of the major advantages of a partnership is the tax treatment it enjoys. A partnership does not pay tax on its income but "passes through" any profits or losses to the individual partners. At tax time, the partnership must file a tax return Form that reports its income and loss to the IRS.
In addition, each partner reports his or her share of income and loss on Schedule K-1 of Form Personal liability is a major concern if you use a general partnership to structure your business. Like sole proprietors, general partners are personally liable for the partnership's obligations and debts.Corporate structure is a way of organizing a company in three parts; Board of Directors, Corporate Officers, and Shareholders. Also known as corporate governancecorporate structure is the way of running a business.
Corporate structures include:. The company's bylaws will say how many members the board needs. Members' personal assets are separate from business assets. They are also responsible for the corporation, its officers, agents, employees, and subsidiaries.
They are also called upper management. Officers handle day-to-day tasks. They look out for the company's interests. Shareholders own the company. They don't typically take part in daily business. Different kinds of corporations have different numbers of shareholders. S corporationsor s-corpsusually have fewer than C corporationsor c-corps, may have many more than that.
A corporation may have several shareholders. Each owns a part of the company. Owning more of the business gives a shareholder more power. These people own common stock shares. They get a return from the company in the form of profits.
Shareholders are not personally liable for the company. Shareholders help make decisions. Those who own more shares have more interest in the company. While a corporation's owners are usually its first shareholders, larger companies can have many public shareholders. Corporate structure separates owners and managers. Clear structure can grow a small family business into an international company that's traded around the world.With the changing corporate horizon, it has become increasingly difficult to keep track of what people do and where they stand on the corporate ladder.
Should we be paying more attention to news relating to the CFO or the vice president? What exactly do they do? Corporate governance is one of the main reasons that these terms exist. The evolution of public ownership has created a separation between ownership and management.
Before the 20th century, many companies were small, family-owned and family-run. Today, many are large international conglomerates that trade publicly on one or many global exchanges. In an attempt to create a corporation in which stockholders' interests are looked after, many firms have implemented a two-tier corporate hierarchy.
On the first tier is the board of governors or directors : these individuals are elected by the shareholders of the corporation.
On the second tier is the upper management: these individuals are hired by the board of directors.
The Basics of Corporate Structure
Let's begin by taking a closer look at the board of directors and what its members do. Please note that this corporate structure is what's common in the U.
Elected by the shareholders, the board of directors is made up of two types of representatives. The first type involves inside directors chosen from within the company. The other type of representative encompasses outside directorschosen externally and considered independent of the company. The role of the board is to monitor a corporation's management team, acting as an advocate for stockholders.
In essence, the board of directors tries to make sure that shareholders' interests are well served. Chairman: Technically the leader of the corporation, the board chairman is responsible for running the board smoothly and effectively. Their duties typically include maintaining strong communication with the chief executive officer and high-level executives, formulating the company's business strategy, representing management and the board to the general public and shareholders, and maintaining corporate integrity.
The chairman is elected from the board of directors. Inside Directors: These directors are responsible for approving high-level budgets prepared by upper management, implementing and monitoring business strategy, and approving core corporate initiatives and projects.
Inside directors are either shareholders or high-level managers from within the company. Inside directors help provide internal perspectives for other board members. These individuals are also referred to as executive directors if they are part of the company's management team.Marketing software to increase traffic and leads.
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Choosing the best organizational structure for your company, division, or team is a lot like picking out a new car. At the most basic level, you're always looking for something road-worthy -- something that can take you and your passengers from point A to point B without a hitch.
But beyond that, there are a lot of options to consider. Automatic or manual? Four-wheel drive or two? Built-in GPS? Leather interior? Flux capacitor? Only if you're going back in timeof course. In the world of organizational structures, the options you have to choose from include things like chain of command long or short? An organizational structure is a visual diagram of a company that describes what employees do, whom they report to, and how decisions are made across the business.
Organizational structures can use functions, markets, products, geographies, or processes as their guide, and cater to businesses of specific sizes and industries. What's the point of an organizational structure? As a business leader, do you even need one?A normal corporate structure consists of various departments that contribute to the company's overall mission and goals.
These five divisions represent the major departments within a publicly traded company, though there are often smaller departments within autonomous firms. There is typically a CEOand Board of Directors not usually composed of the directors of each department. There are also company presidents, vice presidents, and CFOs. There is a great diversity in corporate forms as enterprises may range from single company to multi-corporate conglomerate. The kind of differentiation and diversity among corporations is of importance to corporate law for example such difference in corporation type that has impact on corporate structure is the difference between public owned and proprietary companies.
The structure must also be a good fit for the type of activities, goals, and vision of the company. This model is commonly used in single-program organizations. It is basically the standard structure mentioned earlier, which is organized around departments. This structure is most appropriate for all small organizations. Divisional structures are also called cstructures'' because they are based on a certain product or project. This structure is most common in multi-service organizations.
Business Structure Basics
Normally, it's based on the departments divided in the firm. Geographic structures are used in multi-site organizations and are frequently used by networks across different geographic areas. The Matrix structure is probably the most complicated model of them all because it is organised around multiple dimensions e. This structure is commonly used in very large organisations because a greater volume requires greater co-ordination.
However, this structure is very difficult to manage so it is usually better to reconsider its use and replace it with a different type of structure, then compensate for the tradeoffs. In addition to those models, there are other factors that make up the structure of an organization. Depending on the chain of command, a company's structure could be classified as either vertical or horizontal, as well as centralized or decentralized.
A vertically structured organization or a "tall" company describes a chain of management, usually with a CEO at the top delegating authority to lower-level managers through mid-level managers.
Horizontal or "flat" companies, however, have almost no middle-managers, which implies that high-level managers get involved in daily tasks and interact with customers and front-line personnel. Decentralized organizational structures allow individuals some autonomy at each level of the business, because they join the decision-making process. Evidently, classifying organizations as centralized or decentralized is linked to them being "tall" or "flat".These differences are linked to region-specific demands of target customers, such as variations in the preferences for apparel based on sports popularity and climate.
As such, Nike Inc. As one of the leading players in the athletic footwear, apparel and equipment industry, the company and its corporate structure serve as an example of how regional variations must be included in business strategies. Nike Inc. The characteristics of its corporate structure provide Nike with flexibility to address consumer preferences for athletic shoes, apparel and equipment in regional markets.
This flexibility is especially notable in how the company markets its products through company-owned NikeTown stores. Nike has a geographic divisional organizational structure. Global Corporate Leadership. For example, the Global Sports Marketing group releases new athletic shoe marketing campaigns for worldwide marketing. The following are the main global leadership groups headed by a President, Executive Vice President, or Chief Officer:.
Semi-Autonomous Geographic Divisions. Geographic divisions are a major organizational structure characteristic of Nike, Inc. Global Divisions for Converse and Brand Licensing.
One global division is responsible for managing the worldwide operations of Converse, which is another footwear brand and subsidiary of Nike Inc. Another global division is responsible for licensing the Nike brand.
Organizational Culture Characteristics: An Analysis.