Month: November 2012

Emily’s blog post caught my eye because I don’t think I would ever want to pay $4 for a milkshake…

I then realized that her blog post was about Starbucks, an ever-successful coffee company that has essentially dominated the coffee industry. The “milkshake” is a Frappuccino, a delicious drink that I buy often on scorching summer days to refresh myself. I take back what I said in the first sentence.

How does Starbucks thrive within the coffee industry? This picture in Emily’s post sums it up well:

The value proposition that Starbucks offers to its customers is that its customers belong to a community; it is a “home away from home” (Starbucks psychology, ABC News). For instance, Starbucks has created its own language for coffee drinks and cup sizes. A Frappuccino is a milkshake, a tall is a size small. The first few times I ordered drinks from Starbucks were interesting as I was not aware of the special terms used. I would say medium and have the barista correct me that it was a grande. No wonder Starbucks has made its way to the top. Customers buy the experience of being part of a tight-knit community.

In my Business Fundamentals class yesterday, Janice Cheam, founder and CEO of Energy Aware, spoke about how she sped along the road to entrepreneurship.

It was very inspiring to hear that it all began with an entrepreneurial course in her fourth year at the Sauder School of Business. Working with a few other students, Cheam wanted to develop a product that would help people become aware of the wasteful amounts of energy used in daily life. Today, Energy Aware has grown and works with various parties, such as the Village on False Creek for the 2010 Vancouver Winter Olympics, to encourage energy efficiency.

Out of the hundreds of students that graduate with a Bachelors of Commerce degree each year, few become successful entrepreneurs. I think what made Cheam make it was her passion to really enforce the idea of energy awareness. She was very persistent with her idea; she struggled with funding the project, and in the end, the company began with the winning money prize of a competition. I admire how she never gave up. It is always the first steps that are the largest leaps, and Cheam managed to succeed in overcoming the difficult barriers of starting up a company.

In Bob Sutton’s blog Work Matters, he comments on the The New York Times interview with the CEO of Citrix, Mark Templeton. What really strikes him is when Templeton speaks about the relation between hierarchy and respect: “You have to make sure you never confuse the hierarchy that you need for managing complexity with the respect that people deserve.” The point is that it’s important that top-management does not engage in power poisoning, which is mistaking high-in-the-hierarchy for high respect.

I agree with Sutton and Templeton. Connecting back to my Business Fundamentals Class 14, whose focus was “People, Culture, and Teams”, Sutton’s blog and Templeton’s article emphasizes again the importance of organizational structure. Whether an organization has a flat or tall organizational structure affects its employees in ways good and bad depending on the organization’s size, complexity, and nature. Generally, flatter structures facilitate better communication between employees and top management, while taller structures require most of a step-wise communication path between the two. Nevertheless, employees and employers should be treated with the same respect; as Sutton puts it in his blog post, “When leaders believe and especially act on this belief, all sorts of good things happen”.