Executive Summary of Strategic Management Accounting

Starbucks is one of the sustainable organisations across the globe that always focus on customer safety and security by providing health food products for all. This report concerns about strategic management rules and its proper applications for Starbucks authority to reduce negative impact of business for environment. On the other hand, key stakeholders are identified in this report to evaluate their importance in business process. Along with this, strengths and weaknesses of this organisation is forecasted in this study and GRI standard is also elaborated. Moreover, this report is a clear overview about business sustainability of Starbucks and its proper implementation.

Table of Contents


Question 1.

Question 2.

Question 3.

Question 4.

Question 5.

Question 6.

Question 7.

Question 8.



Introduction to Strategic Management Accounting

The requirements for and analysis of management accounting data which a businessman and their competitors use for development and monitoring business strategies are strategic management accounting. Any of the instruments used to assess the efficiency of strategic accounting management are: goal costing, costing Kaizen, life-cycle costing, constraint theory (TOC), benchmarking, business-oriented management (ABM) and the time-efficient (JIT) approaches. Strategic management accounts help you recognise a corporate company's strategic edge that will generate more revenues and open new competition doors. The administration also assists in controlling unsustainable practises which can plunge the corporation into the profit margin. This article analyses Starbucks' strategic management in order to get an understanding of how the organisation manages so many stores worldwide.

Strategic Management Accounting - Question 1

A company's successful approach determines the company's long-term success and progress. Although the management accounting policies of Starbucks are highly appreciable, they are limited by-the history of a specific location, local values and rationalities identified and the individual habits of organising participants designated to carry on accounting management. The Environmental Control System (SCS) is responsible for the need for sustainable development activities. The annual global social impact report by Starbucks highlights three areas: sustainability leadership, creating meaningful opportunities and strengthening the Starbucks community (Atzori et al. 2018).

The organisation evaluated that the aforementioned fields are critical for benefit and would have a huge influence on its organisation. On 16 May 2016, Starbucks Corporation announced that a public subscription to senior bills, including the first US, had been closed. Sustainability Bond with companies. The organisation agreed to expand its environmental initiatives using the net proceeds from the $500 million bid in the 2.450 percent Senior Notes planned by 2026 (Boone 2017). In this year, Kevin Johnson, Starbucks CEO, concentrated better on sustainability, which offers a major environmentally-friendly sector for such a multinational organisation.

Strategic Management Accounting - Question 2

The sustainability practices laid by Starbucks are as follows-

  1. Johnson is working for the 'good resource' which saves more carbon than is emitted and reduces waste and delivers healthier freshwater than is used every day. Without hindering business benefit, Starbucks agreed in the next decade to half its fuel, waste and water pollution. Kevin Johnson proposed three key goals, which seek to minimise emissions of pollution by 50 % by 2030, to reduce waste sent to storage and produce sites by 50% and to maintain 50% of the water now used for direct actions and coffee processing (Campbell and Helleloid 2016).
  2. Starbucks's standard practise is to use science-based analysis to measure development. Recently, Starbucks 's global sector and supply chain, which has collaborated with Quantis and the World Wildlife Fund, developed a new system for monitoring the growth of environmental pollution, water usage and waste production (Inda and Sanawiri, 2018). The association will have a framework to assess future success in the short and long-term check against business goals. The association will be open.
  3. Starbucks has established core business fields that have a significant effect on consumers by growing plant and environmentally sustainable menus, from individual to reusable packaging, further investments on creative agriculture, saving water, repo-forestation practise, the quest for improved waste (even food) management solutions in shops and cities, and the development of these waste management systems in cities. (Kang and Namkung 2018).
  4. For a long time Starbucks has partnered and participated in sustainability initiatives such as Starbucks FoodShare programme and NextGen Cup Challenge, which is now leading in stores in the L.E.E.D. market, clean energy projects and the ban on disposable straws by the end of 2020. For over 20 years, a collaboration between the organisation and Conservation International to reach 99 per cent ethically by leveraging C. A.F.E. (Coffee and Farmer Equity) practise has more than halved the company's carbon emissions over the years (Montiel et al. 2018).
  5. Starbucks partners are planning to change the number by engaging in an online course on biodiversity and environmental management. The number of registrations has grown by over 30000 in the last two years. In the area of 'resource-positive' the organisation strives to become a model for other businesses as this provides long-term profit and profitability to the sector.

Strategic Management Accounting - Question 3

From the very beginning, Starbucks has integrated sustainable strategies with business development. Late in the 1980s, Americans in Seattle were unhappy with the inferior quality of robusta beans which was well sensed by the founders- Jerry Baldwin, Zev Siegel, and Gordon Bowker. Thus, they build up a small business in selling authentic coffee beans which was the building stone of this authentic network (Nambalirwa Kawuma and Marcovecchio 2017).

With satisfying and authentic products, Starbucks had built value propositions and created a place in the market. Starbucks ’ sustainability strategies can be categorized in the following points- ethical sourcing which includes planting trees to lessen carbon emission, raising a global farmer fund which pays for the hard work they give in providing the authentic coffee beans, building commitment, practicing open-source agronomy using the latest research facilities; greener retail goal which is using a greener cup, store facilities, and emphasizing on greener apron course to increase the number of happy customers; creating opportunities in food sharing by providing support to the food banks and in arranging food and coffee donations to hospitals, non-profit, local police and health officials, and other frontline workers (Ponte 2020).

Strategic Management Accounting - Question 4

The balanced scorecard of Starbucks to show the social responsibility objectives highlights the corporate strategic imperatives that ranked the company to a high level, good customer perspective, well-maintained financial perspective, strong internal-business perspective, and best innovation, learning, and growth perspective (Rampengan et al. 2020).

Strategic Management Accounting - Question 5

The stakeholders who help in the proper management of this global-chain business of Starbucks include- employees, customers, suppliers, the environment, shareholders, and the government. The employers who run this global chain tactically are educated people so they can easily respond to the training. Customer feedback has always been in the first series since the setting up of Starbucks in the 1970s when the fame was spread by word of mouth. Starbucks always aims at providing a relaxing social atmosphere for its customers. The suppliers are given special information to provide the best products and Starbucks has reached the 99% margin in distributing quality coffee (Sokol and Jordanov 2020).

Strategic Management Accounting - Question 6

The factors that affect a company’s willingness to publish a sustainability report are-

  • Delicate environment and resource constraints which check the balance of nature so that it is not destroyed because the earth has limited room and resources, check the use of plants and animals by humans, checking the exploitation of other resources, and putting an end to overuse (Tsai et al. 2020).
  • Growth limits and human science to limit environmental problems using technologies and check that modification of the environment for human needs does not cause serious problems.

Strategic Management Accounting - Question 7

Yes, a high-rated company like Starbucks reporting its sustainability performance regularly is more likely that the company is more sustainable in its outlook and performance which can be comprehended from their work.

Forecasting about sustainability report is necessary for any organisation to gain much more reputation from public and maintenance of business process in a correct manner can also be possible through this. As Starbucks forecast their report all the time by aligning customers and employees, it becomes facilitated for them to get communicate for all (Starbucks.com 2020).

Strategic Management Accounting - Question 8

The sustainability report of Starbucks points out some strengths and weaknesses. The following strengths rank Starbucks as a valuable brand -

  • Leading retailer of brand special coffee.
  • Leading provider of authentic products and services (Starbucks.com 2020).
  • Positive feedback by customers in providing high-quality service.
  • A very small number of competitors with such a high share market as Starbucks.

The weaknesses of the strong organization are-

  • The cost of the products is very high since they provide quality materials.
  • The company gives no guarantee for the food items sold- milk, beverages, chocolate, ice cream, and baked items to be free of genetically-modified components (Starbucks.com 2020).
  • The main business is centred around the US which needs to be expanded to reduce business risk.

Conclusion on Strategic Management Accounting

From the study, we can infer that Starbucks management strategies operate together as a multinational enterprise in the pursuit of good individuals, a good world, and benefits in line with their mission and values. As Mr Johnson said, the yearly global social effect focuses on three fields: sustainability leadership, potential opportunities and community building because these are the key places for organisational growth that are important to our consumers and therefore have a significant impact. Also, by contacting different stakeholders, the organisation controls the content consistency, but knowledge is kept confidential. In addition, Starbucks 's distribution of exclusive items is a power and brand recognition for all consumers. In the other hand, the growth in the regular business market of the customer-centred model is of benefit for them. Thus, strategic management mixture with sustainability development is well represented by Starbucks with the following mission of the company- 

“To inspire and nurture the human spirit – one person, one cup, and one neighbourhood at a time.”

References for Strategic Management Accounting

Atzori, R., Shapoval, V. and Murphy, K.S., 2018. Measuring Generation Y consumers’ perceptions of green practices at Starbucks: An IPA analysis. Journal of foodservice business research, 21(1), pp.1-21.

Boone, C., 2017. In the News: An Exploration of Starbucks and the Media.

Campbell, K. and Helleloid, D., 2016. Starbucks: Social responsibility and tax avoidance. Journal of Accounting Education, 37, pp.38-60.

Indah, D.C. and Sanawiri, B., 2018. Analisis Implementasi Corporate Social Responsibility (CSR) terhadap Keberlangsungan Bisnis Perusahaan Multinasional (Studi Pada Starbucks Coffee Grand Metropolitan Mall Bekasi). Jurnal Administrasi Bisnis, 54(1), pp.120-129.

Kang, J.W. and Namkung, Y., 2018. The effect of corporate social responsibility on brand equity and the moderating role of ethical consumerism: The case of Starbucks. Journal of Hospitality & Tourism Research, 42(7), pp.1130-1151.

Montiel, I., Antolin-Lopez, R. and Gallo, P.J., 2018. Emotions and sustainability: A literary genre-based framework for environmental sustainability management education. Academy of Management Learning & Education, 17(2), pp.155-183.

Nambalirwa Kawuma, P. and Marcovecchio, H., 2017. Sustainability-centered business model innovation: Learning from and insights into how sustainability has affected the business models of Nespresso and Starbucks.

Ponte, S., 2020. Green Capital accumulation: business and sustainability management in a world of global value chains. New Political Economy, 25(1), pp.72-84.

Rampengan, S.T., Tumbuan, A.J. and Gunawan, E.M., 2020. CUSTOMER EXPERIENCE AND CUSTOMER LOYALTY: A QUANTITATIVE ANALYSIS IN STARBUCKS MANADO. Jurnal EMBA: Jurnal Riset Ekonomi, Manajemen, Bisnis dan Akuntansi, 8(3).

Sokol, V. and Jordanov, K., 2020. Site selection for small retail stores using sustainable and location-driven indicators: Case study: Starbucks coffee shops in Los Angeles.

Tsai, P.H., Lin, G.Y., Zheng, Y.L., Chen, Y.C., Chen, P.Z. and Su, Z.C., 2020. Exploring the effect of Starbucks' green marketing on consumers' purchase decisions from consumers’ perspective. Journal of Retailing and Consumer Services, 56, p.102162.


Starbucks.com, 2020. About, Available at: www.starbucks.com. [Accessed on: 01.10.2020]

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