Now that we’re nearing the end of this course, I’ve been reflecting on everything that we’ve learned, trying to tie things together in preparation for the final. We started our very first class with the Paper Puppets activity, which demonstrated that, amongst other things, quality control was a huge part of the operations process. It seems like the idea of quality has been mentioned nearly every class period since that day, and it is certainly a concept that has stuck with me. I have thought about the quality aspect of many transactions I have made since then, thinking about what is being done well and what could be improved upon. So when I heard that Starbucks was going to add alcohol to their menu, I was interested in finding out more about their decision.

An article in Bloomberg Businessweek presented a cogent point that is not only true about Starbucks but any organization in almost any industry; continuity and change are forces that simultaneously work with and against an organization and must both be acknowledged. The article goes on to differentiate between traditional organizations, which are built for continuity, and organizations that are designed for adaptability. An organization that is purely focused on continuity may face problems when it is forced to change with the times, and an organization based in adaptability needs to focus on creating some form of stability to appeal to customers. It is obvious that a combination of continuity and change is best for a company rather than thinking of the two as opposites.

Starbucks’ motive behind offering alcohol is to increase sales in the evenings. They also hope to give customers a place to relax after work with a drink and some friends. What’s more important, however, is the fact that they did not compromise the image that they have created for the public. Rather than just being in the business of coffee, their main selling point is the culture and atmosphere that they have created (in which they just so happen to sell coffee). By knowing exactly what their business really is, it’s not as much of a risk to add a product that may be a little less conventional so long as they stay true to that community environment that they have fashioned. When it comes to continuity and change, Starbucks has found the perfect mixture, staying consistent in their values and maintaining quality, while keeping up with the changing world around them.

Have you ever experienced or witnessed a failed attempt at balancing continuity and change, in any way, that may have led to a decrease in quality? And do you think it’s possible to honor a mission statement that may be a bit naïve or antiquated given the ever-changing society we live in?

The weight loss organization Jenny Craig, acquired by Nestlé in 2006, expanded to France less than two years ago in response to the country’s sudden, rapid growth – not in population, but in weight. You may find this surprising (I sure did), as France is a country that we view as perpetually skinny despite their affinity for fancy cheeses and culinary finesse. Unfortunately, of all the ways America could have influenced France, they were unlucky enough to pick up our eating habits; a positive correlation can be seen between the rapid expansion of their fast-food chains and their trouser sizes.

The food found in QSRs cannot be the only factor contributing to this change, however, as their expansion is itself the sign of a changing culture. As of 2009, McDonald’s revenue in the country had risen 79% over five years and with it, the number of overweight adults grew about 11%. In the same year, it was also found that about 1 in 3 people were overweight. After considering the steady growth in these figures, as well as the fact that France is a highly image-conscious society, it was a no-brainer for Nestlé to bring in Jenny Craig. They not only used this sort of qualitative forecasting to guide their decision to enter the market but also to determine whether they would eventually be profitable during their growth. As France has one of Jenny Craig’s highest growth rates, and their competitor, Weight Watchers International, is seeing an increase in business as well, it is obvious that the demand for an effective weight loss program is present. Arguably, economic and technological forecasts may have also been used when considering alterations to their program to cater to the French, which includes locally-made meals; specially designed, French-centred exercise videos; and a website that acts as the base of the program, appealing to their desire for technology.

Everything seems to be going well for now, but there are problems with making such large business decisions based on forecasts that use such little past information. Although it was a useful tool in deciding to enter the market, it cannot predict the impact that environmental changes may have on the company’s future. For example, sales are quickly increasing in France but not in the world as a whole, which could mean that they’re decreasing in other countries. If France’s culture is so volatile to have changed its fast-food industry in only a few years, what’s to say it couldn’t change again but in a direction unfavourable to Jenny Craig? Could its old culture of fine food and moderation resurface, winning out over fast-food and deeming weight loss programs once again obsolete? Could an economic fall be in their future, putting such a luxury out of business? These are the limits of forecasting. Considering the fact that Nestlé is such a huge corporation, however, I’m wondering whether or not the failure of Jenny Craig in France would even register as a risk.

Source: http://www.businessweek.com/magazine/frances-unlikely-import-weight-loss-centers-01122012.html