Showing posts with label Starbucks. Show all posts
Showing posts with label Starbucks. Show all posts

Thursday, August 29, 2013

What is Servant Leadership and Can it Work?

Servant Leadership
Servant Leadership
Putting people first does not have to correlate positively with low profit margins.  Companies like Starbucks and Southwest Airlines have put people first in their business models with generous employee benefits and education and gained a remarkable profit margin.  Servant Leadership is a leadership model that can and should be deployed in all companies, large and small, for-profit and non.  Servant Leadership is socially responsible and promotes employee satisfaction.  Servant Leadership promotes a sustainable profit margin as well as community but the question remains can a for-profit organization put people first?  Servant Leadership can be applied to large for-profit companies in fact it can provide a sustainable profit margin. Servant leadership promotes stakeholder loyalty and stakeholder loyalty promotes community.  Businesses must be people focused to sustain for generations.  Large companies impact diverse people groups, the social structure of these communities as well as their environments.  Large companies are constantly shaping our world.  Servant Leadership can be applied to large companies such as the for-profit universities and is a topic that deserves further exploration.

Servant Leadership as a Business Model
Companies such as Starbucks and Southwest Airlines are deploying policies that are Servant Leadership friendly from the birth of the business with great success.  Southwest Airlines is creating a Servant Led culture that marks the organization as well as society.  Large non-profit companies such as Fuller Theological Seminary, Habitat for Humanity and the Southern Baptist Convention have run successfully on Servant Leadership for Generations.  Fuller Theological Seminary was founded in 1947 and has a rich history of servant leadership as well as a working community that functions on collaboration with social responsibility being a core value.  The business model of Fuller Theological Seminary will provide an example of what can be done when Servant Leadership is made the end goal of a large organizational model.  Habitat for Humanity was founded in 1976 and serves as an excellent example of how a company can grow and expand to all corners of the globe when a business is built on people rather than profits.  Habitat for Humanity is a non-profit that has seen enormous growth from a small start in Georgia and now to over five continents.  Although large non-profit companies are different from the large for-profit companies in the goal of making a profit this is really where the contrast stops considering that all companies, both for-profit and non, do have a bottom line.  Large for-profit companies can indeed learn from large enduring non-profit companies in terms of sustainability.

Decentralization: The Key to a Servant Leadership Culture
An important component of the Servant Leadership Culture is the decentralized organizational model.  An excellent example of this can be found in Starbucks.  According to Ferrell, Fraedrich & Ferrell, a decentralized organizational model is prone to unethical behavior; however Starbucks is a model that can be used to argue against this theory as it uses its decentralization to encourage its managers as well as individual employees to look for ways in which they can exhibit ethical behavior.  I would argue that the decentralized organizational model, when used properly, encourages ethical behavior.  Not only does Starbucks give its managers freedom of philanthropy, it encourages employees both new and old to contribute suggestions to the company on a regular basis, publishing these suggestions, even the anonymous ones in the company newsletter.  This method of publishing the suggestions affords a form of corporate accountability that encourages ethical behavior.   

You may also enjoy reading Considering frugal Starbucks Ethical Pic or my whole list of Ethical Company Reviews.

Thursday, December 29, 2011

Considering frugal Ethical Pic Starbucks

Starbucks Ethical Pic
Starbucks Considering frugal Ethical Pic

Why do I love Starbucks so much? It is because of the business plan. Although they may make a boo boo here and there, overall they are set up to succeed both ethically and organically.

What is an ethical company?

According to a researcher at Harvard University there are five phases to the development of social responsibility at the corporate level (Zadek, 2005).  This model begins with the defensive stage, “social responsibility is not our job”; the compliance stage is next, “we will only do what we are required”; the managerial stage, this is the stage where social responsibility is viewed as a public relations strategy; the strategic stage, “social responsibility can give us a competitive edge”; the civil stage, this is the stage where a company becomes a leader in social responsibility, encouraging other companies to do so (Zadek, 2005).
Highlights of a Great Business Model
Starbucks was one of the first companies founded on the principles of social responsibility.  Starbucks intentionally spends more on employee healthcare then they do on purchasing their product.  Starbucks offers full health insurance benefits to all of its employees both full and part-time (Ferrell, Fraedrich & Ferrell, 2007).  As a result Starbucks has one of the lowest employee turnovers of any retail business (Ferrell, Fraedrich & Ferrell, 2007).  In a country where affordable healthcare and health insurance are in complete scarcity, some would consider this extreme social responsibility. 
After stanch criticism over fair trade with coffee growers, Starbucks responded by establishing fair trade compliance rules (Ferrell, Fraedrich & Ferrell, 2007). It is clear that Starbucks has operated at the civil stage of social responsibility since its founding.  There is no question that Starbucks is a model of social responsibility. 

Starbucks Corporate gives full freedom to its store managers to donate sums of money to any cause in the local community that that manager feels is worthy (Ferrell, Fraedrich & Ferrell, 2007). Many pro-life/pro-family political supporters have been banning Starbucks for several years; however I would be inclined to believe that the solution to this problem is not so much found in banning Starbucks as in petitioning the local establishments (Hartline, 2006; Kleppinger, 2005).

If the local managers are given the freedom to support what the community supports than by all means as a community we must request donations for our educational programs and pertinent social needs.  Characteristic of a decentralized organizational model, Starbucks will shift with the paradigm of society (Ferrell, Fraedrich & Ferrell, 2007).

Not only does Starbucks give its managers freedom of philanthropy, it encourages employees both new and old to contribute suggestions to the company on a regular basis, publishing these suggestions, even the anonymous ones in the company newsletter (Ferrell, Fraedrich & Ferrell, 2007).  This method of publishing the suggestions affords a form of corporate accountability that encourages ethical behavior.  Starbucks is an organization that is not only a leader in social responsibility; it is an organization that encourages social responsibility on an individual level, which is where social responsibility begins.

                                                                                                                                                          Ferrell, O. C., Fraedrich, J., & Ferrell, L. (2007). Business ethics: Ethical decisionmaking and cases (7th ed.). Boston: Houghton-Mifflin.

Hartline, James.  (2006).  Starbucks funds homosexual causes.  Americans for Truth About

Kleppinger, Meghan.  (2005).  A habit easily broken.  Concerned Women for America.  Retrieved August 17, 2009 @

Nike.  (2009).  Nike Responsibilty.  Nikebiz.  Retrieved August 17, 2009 @                  

Zadek, Simon.  (2005).  The five steps of corporate responsibility.  Harvard Business School.  Retrieved August17, 2009 @

How I became Considering frugal

Fueled by the growing list of pollution related allergies my family suffered from each day, and inspired by my 97 year old grandmother who could recycle ANYTHING before recycling was cool, back in 2011, I decided (in the spirit of the Julie/Julia Project...) to embark on a journey to see just how much one family could do to change our planet. I didn't consult any other parties before I launched this idea. Thankfully my husband, daughter and son are usually my biggest supporters. Here is the catch; as I'm normally very thrifty (you can note from early blog posts), I was looking for ways that I could reduce our carbon footprint and make socially responsible purchases without increasing our spending. Mmmmmm. We succeed in changing some of our habits a bit and finding ways to reduce our footprint. There were lots of fun epic fails alone the way too! But the biggest change we have made over the course of the last six years, was to move from the mega city of Phoenix to Wyoming. You can read my full bio on my About Me page.

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While it is true that I am working on a PHD in Psychology and very smart and frugal, I am not a medical doctor, criminal, personal or accident lawyer. I do not sell insurance nor am I an accountant or mortgage advisor. While some of my posts may offer good ideas on home, health and business solutions, I am not personally responsible nor is Considering frugal for any advice, ideas, recipes or menu plans that you decide to use. This blog is intended to be helpful and fun. Any products you purchase from my Amazon store or any other retailer advertised on my blog must be returned to them. I may sometimes endorse a product that I love. This is simply my opinion, you must try all products at your own risk. While I personally do not use tracking cookies or share information, my affiliates are third parties and they may do so. Please click, travel and purchase at your own risk.

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"...for your Father knows what you need before you ask." Matthew 6:8