STARBUCKS MISSION & VALUES 

“To inspire and nurture the human spirit -

one person, one cup and one neighborhood
at a time.”
With our partners, our coffee and our customers at our core, we live by these values:

● Creating a culture of warmth and belonging, where everyone is welcome.

● Acting with courage, challenging the status quo and finding

new ways to grow our company and each other.

● Being present, connecting with transparency, dignity and respect.

● Delivering our very best in all we do, holding ourselves accountable for results.

We are performance driven, through the lens of humanity.

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 PRODUCT & SERVICES 
Starbucks Coffee
Starbucks strives to serve the best coffee possible. They place the highest standards of quality, using ethical

sourcing practices to produce the best coffee. With coffee buyers personally traveling to coffee farms in Latin

America, Africa and Asia to select high quality beans. The master roasters bring out the balance and rich flavors

of the beans through the signature coffee.

Starbucks Stores
Starbucks stores are a neighborhood gathering place for meeting friends and family. Starbucks customers enjoy

quality service, an inviting atmosphere and an exceptional beverage.

Starbucks Partners

Starbucks offers some of the finest coffees in the world, grown, prepared and served by the finest people.

Starbucks employees, who are called partners, are at the heart of the Starbucks Experience.

Starbucks Products
Starbucks offers a range of exceptional products that customers enjoy in stores, at home, and on the go.

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 STARBUCKS COMPANY HISTORY 
Starbucks began its journey in 1971 when a single store in

Seattle’s Pike Place Market opened up as both roaster and

retailer of whole bean and ground coffee, tea and spices.

From its meager beginnings, Starbucks has emerged to

almost 24,000 retail stores in over 70 countries. In 1991,

Starbucks became the first privately owned U.S. company

to offer a stock option program that includes part time

employees, along with offering full health benefits to eligible full and part time employees. In 1995, the iconic Frappuccino

blended beverage was born, the following year, the bottle version hit supermarkets across North America. With over 12,000

stores Starbucks launched the industry’s first paper beverage cup containing post-consumer recycled fiber in 2006. In 2014,

Starbucks Mobile Order & Pay was launched, revolutionizing the drink industry. With over 22, 000 stores, Starbucks

launched the Cold Brew iced coffee in 2015, quickly becoming the newest coffee craze.

Starbucks’ mission is to inspire and nurture the human spirit--one person, one cup and one neighborhood at a time.

Starbucks strives to serve the best coffee possible, it is their goal for all coffee to be grown under the highest standards of

quality, using ethical sourcing practices.

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 STARBUCKS CRISIS TEAM MISSION 
Crisis:​ Any situation that is threatening or could threaten to harm people or property, seriously interrupt business,

significantly damage reputation and/or negatively impact the bottom line.

The mission of the Starbucks Crisis Management Team is to provide detailed and thorough instructions and

guidelines in the event of a crisis. Effectively monitoring and managing a crisis can reduce the impact and

visibility of the event or incident. The Crisis Management Plan intends to perform to their utmost ability to ease

any negative impacts or perceptions on the company due to any of the following crisis.

STARBUCKS DESIGNATED CRISIS MANAGEMENT TEAM 

Spokesperson - ​Chief Executive Officer Kevin Johnson

Chief Executive Officer Kevin Johnson will be the spokesperson for the Starbucks Company and is prepared to

maintain the company’s public image. Johnson will be the designated individual who will communicate with the

public and any other media outlets.

Alternative Spokesperson -​ ​Executive Chairman Howard Schultz

Executive Chairman Howard Schultz will be the alternative spokesperson for the Starbucks Company when Chief

Executive Officer Kevin Johnson is unavailable or when there is a conflict of interest present. Schultz will also be

prepared to maintain the company’s public image. He will become the designated individual who will

communicate with the public and any other media outlets.

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Crisis Team Manager - ​Sr. VP of Global Public Affairs & Social Impact John Kelly

Sr. VP of Global Public Affairs & Social Impact John Kellys role is essential due to the fact that he has received

the required credentials. Kelly will be at the forefront of any crisis that may arise and affect the Starbucks

Company’s public image. He will be the one to manage and disseminate any relevant information to the rest of

the crisis team. Kelly will also be the one to finalize any decision regarding any course of actions or strategies

that will effectively aid Starbucks in effectively handling difficult times or situations as soon as possible.

Crisis Comm and Media Manager - ​Sr. VP of Marketing Katie Seawell

Sr. VP of Marketing Katie Seawell will serve as the communications and media contact who will be responsible

for any media outreach and releases. Seawell will be prepared to handle any social media issues, will arrange

interviews with the press, will conduct media research, will fact check all media releases or other information,

and will be the person reporters contact for any reason. She will also be the one coaching Howard Schultz and

Kevin Johnson so they are prepared to address the public.

Crisis HR Representative -​ ​Sr. VP of Operations Services and U.S. Alignment Denise Nelsen

Sr. VP of Operations Services and U.S. Alignment Denise Nelsen will be the designated human resources

representative responsible for ensuring that the crisis management team implements the designated crisis

strategic plan. She will also be responsible for ensuring that the team is taking into account the health, safety and

welfare of employees. Nelsen will also be the one to collaborate with other organizational leaders if necessary.

He will make sure that the rest of the human resource team validates that every step of implementing the crisis

management plan will not negatively impact the company’s human capital.

In-House Legal Representative - ​Executive VP of Chief Partner Officer Lucy Lee Helm

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Executive VP of Chief Partner Officer Lucy Lee Helm will be the designated in-house legal representative who

will be responsible for ensuring that the current legal team addresses any legal issues related to the crisis at

hand. She will also ensure that the legal team keeps up with the evolving and developing legal needs of the

company.

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 KEY CONTACT INFORMATION 
Starbucks Coffee Company

http://www.starbucks.com
2401 Utah Avenue South
Seattle, WA 98134-1436
Phone: ​1-800-Starbuc
Email: ​info@starbucks.com
Hours: 4 AM - 11 PM (PT), 7 days a week

Crisis Management Team Contacts

Executive Chairman Howard Schultz

Email:​ hschultz@starbucks.com
Phone:​ ​206-447-1575

Chief Executive Officer Kevin Johnson

Email:​ kjohnson@starbucks.com
Phone:​ ​206-447-1575

Senior Vice President of Marketing Katie Seawell

Email:​ kseawell@starbucks.com
Phone:​ ​206-447-1575

Senior Vice President of Global Public Affairs & Social Impact John Kelly
Email:​ jkelly@starbucks.com
Phone:​ ​206-447-1575

Senior Vice President of Operations Services and U.S. Alignment Denise Nelsen
Email:​ dnelsen@starbucks.com
Phone:​ ​206-447-1575

Executive Vice President of Chief Partner Officer Lucy Lee Helm

Email:​ lhelm@starbucks.com
Phone:​ ​206-447-1575

 
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 KEY PUBLICS AND SHAREHOLDERS
Employees 
The Starbucks employees are one of the most important shareholders for the company. The employees are
the one who create or deliver the products or services that the customers consume. If a company wants to attract
and retain top talent at all levels then it has to offer terms and conditions that are attractive for employees.
 
Customers 
The first purpose of a company is to create customers, so in almost all situations the customer has to come
first. The customer can always choose to take his business to a competitor so it is essential that the company
continue to innovate, to offer good products and good value for money.

Shareholders 
The shareholders own the company. They might well have put forward the seed capital which the
company need to get started so their needs are important. Ultimately the board, acting on behalf of the
shareholders, can replace the CEO and the executive team. However, provided Starbucks is broadly on plan in
terms of revenues and profit the shareholders are generally satisfied and will leave the company alone. They will
only take action when things are going badly wrong.

Suppliers 
Starbucks need to collaborate with its partners to run the business. It is best to build good long-term
relationships. However, the partners also have their own agendas and most can be replaced if they underperform
or a better partner appears.
 
National government and regulatory authorities 
Starbucks must address the interests of numerous governments as shareholders, considering the company’s global
presence. In general, Starbucks wants to be compliant with regulations and avoid disputes and prosecutions.  

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 RISK ANALYSIS 

Past/Current Industry Crisis 

Coffee Shortage (2016)
Due to climate change, research has shown that by 2050 more than half of the world’s area that is deemed suitable
for growing coffee will be lost. According to a report from The Climate Institute of Australia, by 2080 wild coffee
which is more resistant to climate stress could go extinct. Not only does this make it harder to get coffee, it also
affects the millions of coffee farmers globally. The coffee industry is the second most valuable export for
developing countries, a coffee bean shortage can fatally affect the industry.

Coffee Farmers Switch to Cocoa (2016)

In Nicaragua, coffee farmers are switching to other more profitable crops as opposed to coffee. Coffee trees are no
longer viable, and are being replaced with cocoa. Planting the cocoa trees costs about a third of what it would
potentially cost to renew the damaged coffee plants. Cocoa production has steadily risen, totaling 8.5 million
pounds in 2015. In Honduras, the government is requiring growers to substitute eight percent of coffee land to
cocoa.

Grocery Stores become Fast-Food’s Highest Competition (2016)

Grocery store prices are dropping due to lower commodity costs, which is causing more people to stay in and
make dinners at home, or prepare meals to be taken on the go. Fast-food chain Wendy’s experienced a decline in
their projected sales growth reports, with sales only rising .4 percent as opposed to their estimated 1.9 percent. In
addition, as a ploy to attract millennials, in-store dining and take-out prepared foods has been on the rise in
grocery stores, with a 30 percent increase in those products since 2008.

New York City Soda Ban (2013)

New York Mayor Michael Bloomberg had a plan to ban soft drinks and “sugary beverages” larger than 16 ounces
from being sold at food-service establishments. Sweetened coffee drinks that were less than half milk were not
exempt from the ban, but milkshakes and ice creams were. Frappuccinos had remained a source of debate and

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confusion for most people. The ruling was overturned, but if passed would have been a major hit to the beverage
industry, with most if not all fast food retailers serving drinks larger than 16 ounces.

The Coffee Crisis (2006)

The ICA, which controlled the pricing for coffee, collapsed in 1989 and was later replaced with the Free Market.
Prices plummeted to $0.49 per pound with farmers only receiving a fraction of the coffee price, far below
production cost. Small farmers were left extremely vulnerable, experiencing up to a 70 percent drop in their
incomes leaving many devastated. Farmers abandoned their lands migrating north, or began growing more
profitable crops, including drugs. Not only is there a shortage in coffee beans there is now one with the farmers
that grew the crop.

Past Company Issues/Crisis 

Mobile Orders (2017)
Starbucks is being inundated with mobile orders because the app is extremely popular. Customers are placing
orders through their phones to skip the lines and have their drink ready by the time they arrive. With the increase
in mobile orders, baristas at some of the busier cafes are experiencing difficulty balancing both mobile and
in-store orders. The bottleneck in the lines and the added delays has caused some customers to leave the stores.
This contributed to a transactions slump at U.S. cafes, as well as a smaller than projected rise in quarterly sales,
resulting in the worst retailing December the company had seen.

Fecal Bacteria (2017)

Watchdog BBC1 did a piece on fecal bacteria found in iced drinks from 3 different chain stores, including
Starbucks. Bacteria was found in 3 out of 10 drinks tested. The source of the fecal bacteria being a human source.
Starbucks took action, acknowledging the claims and quickly informed BBC they would be conducting their own
investigations into the claims, Starbucks claiming to take hygiene, “extremely seriously”. Starbucks has suffered
from a contamination crisis before, and we have examined the further risks of a large scale contamination.

#RaceTogether (2017)

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The coffee chain encouraged, but did not require, baristas to write #RaceTogether on coffee cups to prompt a
national conversation over race relations. However, controversy soon ensued when customers felt like politics was
being shoved at them uninvitingly while they were just looking to purchase coffee. The campaign has drawn sharp
criticism online, with many commenting on the company's lack of diversity in hiring and whether employees are
equipped to engage in these discussions, among other issues. The viral campaign gained a lot of attention,
however the criticism and overall dissatisfaction was prevalent, with users on Twitter voicing their distaste.

Starbucks Red Cups (2015)

Starbucks changed their Holiday Cups to remove Christmas symbols to instead have a basic two-toned red cup.
The change was enacted to welcome customers of all stories and backgrounds, however social media users once
again descended on the company, saying Starbucks hated Jesus and Christianity. This turned into a national
conversation, with customers boycotting the company, or having terse encounters with baristas in stores.
 
Current Trends 
Millennials make up largest coffee drinkers (2017)
A new report shows that young people ages 19 to 34 years old make up 44 percent of the coffee drinkers in the
U.S. Daily coffee consumption has risen at a rate that makes up for decline in older generations. The number of
lattes, flat whites, and cappuccinos drunk by 18 to 24-year-olds soared from 34 percent to 48 percent between
2012 and 2016. In 25 to 30-year-olds, the figure jumped from 51 percent to 60 percent.

Out of home coffee consumption (2017)

According to the National Coffee Drinking Trends, out of home coffee reached a high of 46 percent in 2017. More
people are drinking coffee outside of the home, which is an opportunity for Starbucks to draw them into stores.

Coffee upsells (2017)

The coffee industry is noted as #4 in upselling larger drinks. When customers visit a coffee shop or store, they are
more likely to purchase a larger drink or add-in extras. The most susceptible to this trend is the millennial
demographic.

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Cold Brew Coffee (2016)
Cold brew sales jumped 580 percent between 2011 and 2016. The cold brewing process uses ​time​, rather than heat
– soaking beans in water for 12 hours or more in order to turn water into coffee. Most cold brews are ordered at
coffee shops, but retailers are catching on with the trend and incorporating it in their stores.

Main Threats
● Product Contamination
● Coffee Bean Shortage
● Increase in coffee prices, in store and grocery stores
● Cyber Hacking via the Starbucks Mobile Pay App
● Employee Misconduct
● Increased wait time in stores for Mobile App purchases

Top Three Threats

1. Product Contamination
a. June 2017; Watchdog BBC1 did a piece on fecal bacteria found in iced drinks from 3 different chain stores,

including Starbucks. Bacteria was found in 3 out of 10 drinks tested. The source of the fecal bacteria being a

human source.

i. Starbucks took action, acknowledging the claims and quickly informed BBC they would be

conducting their own investigations into the claims, Starbucks claiming to take hygiene, “extremely

seriously”. Starbucks has suffered from a contamination crisis before, and we have examined the

further risks of a large scale contamination.

2. Cyber Hacking
a. Starbucks mobile app users are experienced cyber hacking via Online account information. The hackers

would break into online accounts, add a new gift card, transfer funds over and repeat. The Starbucks mobile

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 app lets you checkout with your phone and also reload your card by drawing funds from your credit card and

bank account.

i. Starbucks acknowledged the claims and investigated each claim and took corrective action. Each

victim of the cyber hacking was reimbursed the fraudulent charges. The account charges were likely

due to weak customer passwords; Starbucks suggests customers use strong, unique passwords.

3. Employee Misconduct
a. 2011; Starbucks employees went on a homophobic rant about a gay employee in a Long Island Starbucks,

causing him to resign. It was reported by a Blogger and later picked up by a major news publication. The

Blogger reported that it was “one of the most brazen and unapologetic displays of homophobia I have ever

witnessed in my entire life”.

i. Starbucks immediately acknowledged the accusations but moved in a direction of minimization, not

making any statements on what action steps would be taken. Starbucks launched an investigation

into the allegations. In a company statement, “​We are disheartened by the allegations reported in an

East Coast Starbucks store and are taking immediate measures to investigate and take any steps

necessary to make this right.”

Industry Competition 
Coffee Bean and Tea Leaf
● Coffee Bean and Tea Leaf is the oldest privately held chain of specialty coffee and tea stores in the
U.S. In 1963 the first store opened in Southern California by founder Herb Hyman, where he began
importing and roasting coffee. Coffee Bean serves similar drinks, flavors, and offers a rewards
program similar to Starbucks that with a mobile/pay ordering app. Their drinks often go
head-to-head with Starbucks, with patrons comparing the tastes and costs of each.
● In 2015, sales for the company exceeded 200 million, with a 1.1 percent increase from the previous
year.

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Dunkin’ Donuts
● In early 2000s, the Dunkin’ Donuts brand began to expand the growth of its coffee business. The
company introduced its first specialty coffees and drinks, and slowly began to create a destination
coffee shop atmosphere. In 2006, Dunkin’ Donuts launched its “America runs on Dunkin” ad
campaign to approach the coffee market, waging war against Starbucks. Dunkin’ Donuts appeals to
the all-American consumers, utilizing word of mouth to spread its name and traditional
advertisements. Similarly to Starbucks, Dunkin’ Donuts also offers customers dry coffee goods as
well; coffee beans and ground coffee in retail and grocery stores around the world.
● In 2016, Dunkin’ Donuts Brand reported sales of $828.9 million in revenue from the 11,500
franchise locations. Starbucks, in comparison, generated $16.8 billion in revenue for 2016 with
22,519 stores.

McDonald’s
● McDonald’s is traditionally known to be a fast-food restaurant, however, in the mid 2000s, McDonald’s has
joined the coffee industry, introducing flavored iced coffees and blended beverages. The company had
revamped and rebranded its marketing and advertising strategies to keep up with the evolving industry.
Similarly to Starbucks, McDonald’s also offers customers dry coffee goods as well; coffee beans and ground
coffee in retail and grocery stores around the world. The main difference between McDonald’s and
Starbucks, being the expansive food menu.
● In 2016, McDonald’s reported sales revenue at a whopping $24.6 billion, significantly higher than both
Starbucks and Dunkin’ Donuts.

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 VULNERABILITY ANALYSIS 

Potential Crisis - Contamination of Product 

June 2017; Watchdog BBC1 did a piece on fecal bacteria found in iced drinks from 3 different chain stores, including
Starbucks. Bacteria was found in 3 out of 10 drinks tested. The source of the fecal bacteria being a human source.
Starbucks took action, acknowledging the claims and quickly informed BBC they would be conducting their own
investigations into the claims, Starbucks claiming to take hygiene, “extremely seriously”. Starbucks has suffered from a
contamination crisis before, and we have examined the further risks of a large scale contamination.

Possible Risks
● Improper cooking temperatures, cross-contamination, unsanitary utensils/equipment, poor
employee health/hygiene are all factors that lead to contamination. Issues of contamination could
possibly lead food/beverage inspectors to believe that safe food handling procedures are not being
followed properly. This could likely affect store location ratings and the company as a whole.
The Starbucks company deals with food and beverages on a daily basis which is make it a perfect
site for cross-contamination to occur and for bacteria and viruses to thrive.
● Customers could possibly be affected by contamination and inherit a foodborne illness which can
usually ​cause symptoms such nausea, fever, diarrhea and vomiting. Anyone can be susceptible to
the illness, but elderly people, infants, pregnant women and anyone with a weak immune system
is highly susceptible. ​Severe illnesses can possibly lead to death.
● Contaminated products purchased at one of our locations or at participating retailers can lead to
not only a damaged brand image, but a decline in returning sales.
​Possible Losses 
● If contamination of the product is present, store location ratings may be affected. Sometimes
stores are shut down due to this and would result in a loss of capital.
● When a customer purchases a product at Starbucks, they are putting their trust in the company to
receive quality product. Contamination of the product makes it highly likely that the customers
will lose interest and trust in our product.

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 ● If a customer has the means to do it, they may decide that they want some form of retaliation
against the company due to the inconvenience it has caused them. If they have the time and valid
proof to follow through with a lawsuit, the company can lose human and monetary capital.

​ ​Possible Gains 
● Experiencing the effects of contamination of the product can lead to better procedures and
methods that can avoid the issue at all costs.
● The company will have experience and know how to handle the situation if it ever happens again.

Potential Crisis - Customer Data Breach

May 2015; Starbucks customers experienced data breach through the Starbucks app. Even though Starbucks
itself did not get hacked, but the hack did affect Starbucks customers who use the app. The hackers attacked
accounts of the consumers who use the same ID and password across multiple accounts, Starbucks’ app auto
load function, and the simple fact that the Starbucks app does not have a limit on password attempts. This is an
issue because 18% of its transactions are done on the company’s app.
Possible Risks 
● Cyber hacking into applications has become a common crime in the cyberworld. The Starbucks
app rewards loyal customers, facilitates taking monetary transactions, and also offers an online
ordering option. The issue with this is that hackers have evolved their methods in such a way that
customer information could be obtained by the wrong individual. If hackers succeed, information
such as passwords, usernames, and even location data could be at risk.
● Cyber hacking also puts company proprietary information in a very vulnerable position. The
company could be at risk if important and confidential information falls into the wrong hands.
The company could lose human, investment, and monetary capital.
● A customer data breach can prevent the company’s growth as a whole. Technology is constantly
evolving making it difficult and expensive to invest in preventative measures. There are methods
to keep the company's information and assets secure, but it is extremely expensive. Although

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 investment in cyber security measures is necessary, it is expensive and that money used in other
areas of the company that promote company growth.
Possible Losses 
● If a Starbucks customer falls victim to cyber hacking through the starbucks app, their initial
reaction is to blame starbucks for not having a stronger security system. This could cause the
company to lose customers and also deter them from using the app.
● If Starbucks experiences cybercrime or a cyberattack, the Starbucks company could lose large
amounts of capital.
● The Starbucks company could lose their valuable and trustworthy reputation.

Possible Gains 
● Implementing a cybersecurity system that protects not only the company, but the customers and
shareholders as well.
● The company could be the leading example for other major companies to follow.
 

Potential Crisis - Employee Mishaps/Misconduct 

Possible Risks 
● Starbucks has implemented methods to ensure that employees can function in a safe workplace,
but accidents do happen. Injuries and unsafe handling of beverages/food can cause employees to
injure themselves. When employees injure themselves, companies risk not having enough staffing
which could lead to inefficient business.
● If the company does not have a proper training plan or does not properly train the staff, the
company itself can become less effective making it hard to reach the overall company goal. Bad
habits can be easily picked up. One improperly trained staff member can cause a chain effect of
many improperly trained staff members which can also affect company growth​.
● Starbucks company should ensure that employees uphold the mission and values starbucks
embodies. Although cybercrime is a major threat to the company, in-house hacking crimes
committed by in-house employees are also a threat.

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​Possible Losses 
● If there is a large amount of workplace injuries, starbucks employees may want to no longer work
for the company. The Starbucks company would not thrive without employees.
● A business cannot function in an unsafe environment which can cause the businesses to lose
capital and possibly even lead to failure.
● Every company has confidential information that allows them to remain unique to other
companies. If that information is somehow leaked, that company will lose valuable information
that could be used against them.

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 Contamination of Product 
One of the top potential crises for Starbucks is the contamination of products in-store and in consumer products.
A contamination crisis poses a high risk to the Starbucks Company because if products become contaminated it
poses a high risk for customer safety. Dissatisfaction among customers could spread, causing a distrust in the
Starbucks Company and Brand. With 48 million people getting sick from foodborne diseases each year in the
United States (according to CDC) it is highly probable for Starbucks to undergo a product/food contamination
crisis. With the far reaching consequences for a contamination crisis immediate action is of the highest
importance. Due to the wide number of contamination crisis in the food and beverage industry, we have gathered
examples of how these crises were handled. The following are a few examples of how different companies
handled contamination crisis in the past:

Case Study #1
Chipotle’s Contamination Crisis (2015)
 
Problem:  
The fast-food chain Chipotle was hit by a contamination crisis in 2015. After health authorities linked an E.coli
outbreak to six restaurants in the region that affected 52 people, Chipotle closed 43 restaurants in Washington
state and Oregon.​ T​his crisis clearly threatened Chipotle’s reputation and underscored the difficulty of meeting
the needs of a generation of diners who increasingly demand inexpensive food that is safe, natural and nutritious.

Strategy: 
Chipotle took swift and decisive actions to limit the spread; offering their sincerest apologies to affected people,
working diligently with health officials to investigate, as well as being extremely transparent and forthcoming
with information. Chipotle also retained nationally renowned food safety experts to work with them to reassess
their practices, and shared details of an enhanced food safety. Thus, acknowledgement, apology, and corrective
action were strategies used in their crisis plan. PR-Professionals considered the chain handled the contamination
crisis all wrong. According to CNBC an expert who ran the crisis group assessed, “the real problem is they’re
playing defense. A key is to go on the offensive”. Other PR-professionals stressed that Chipotle’s response has
not been very “digestible” for the general public and would have needed to tweak its message and address how
they were fixing the problems.

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Case Study #2 
Nestle Toll House (2009)
Problem:
Nestle Toll House prepackaged cookie dough sickened 77 people across 30 states, 35 of the victims were
admitted to the hospital, a few with severe illness. The FDA confirmed the presence of E. coli 0157, in samples of
Nestle Toll House refrigerated cookie dough produced at the company’s plant in Danville, Va.
Strategy:
Nestle recalled 3.6 million packages of its popular chocolate chip batter. Nestle said the products involved in the
recall included all the varieties of Nestle Toll House refrigerated Cookie Bar Dough, Cookie Dough Tub, Cookie
Dough Tube, Limited Edition Cookie Dough items, Seasonal Cookie dough and Ultimates Cookie Bar Dough.
Nestle, the FDA, and the Center for Disease Control and Prevention launched investigations into the
contamination. Federal investigators spent more than a week at the Danville plant and did not detect
contamination in the equipment or among workers. The Center for Disease Control and Prevention and state
departments, concluded that a single shipment of contaminated flour might have caused the problem; the flour
being the only ingredient in the dough not cleared at the supplier level. The plant was immediately closed for the
investigation.
Nestle took immediate action. The company recalled all possible contaminated products, and quickly informed
the public of the contamination. “We want to strongly advise consumers that raw cookie dough should not be
eaten...We are very concerned about those who have become ill from E. coli 0157, and deeply regret that this has
occurred” the company said in a statement.

Case Study #3 

Ikea Contamination Crisis
 

Problem: 
According to TIME, Ikea stopped sales of their almond cakes after Chinese customs authorities found traces of
fecal bacteria in the product on March 5, 2013. It was pulled from Ikea stores in 23 countries. The cakes were
imported from Sweden. According to the Wall Street Journal, the bacteria found was coliform bacteria, which can

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be found in soil, feces, vegetation and everyday human environments. Time Magazine reported findings from a
microbiologist at the Swedish National Food Agency, Mats Lindblad, said coliform bacteria "could be an
indication of fecal contamination though not always." The company seized 1,8000 almond cakes before reaching
their destination in Shanghai.

Strategy: 
Ikea acknowledged that there were excess traces of the coliform bacteria. They stated that the levels were above
their standard regulation levels but that they were not high enough to create a serious health risk, however, they
still recalled and destroyed the batch as a precautionary measure to ensure the public safety. They took corrective
action but did not apologize. The company isolated the issue to the exact number of cakes infected, acknowledged
the issue and informed the public of exactly what happened and where.

Case Study #4 

Bonsoy Australian Soy Milk Crisis (Australia, 2009)
 
Problem: 
Unsafe levels of Iodine were added to the ingredients of soy milk products via a seaweed product called Kombu.
Nearly 500 people claimed they suffered damaging health consequences, with thyroid and other health problems.
The levels of Iodine added to the soy milk were 50 times the daily recommended intake in any glass, leaving a
number of consumers seriously ill. Bonsoy was removed from supermarket shelves in late 2009 after and was
reconstituted before being released to the public again.
 
Strategy:  
The manufacturer, exporter and distributor of Bonsoy soy milk have agreed to compensate victims with $25
million, which it says is the highest settlement of a food safety class action in Australia. Thus, the company made
use of corrective action to compensate for the crisis they caused. The company took corrective action by
removing the product from shelves nationwide on December 24th. The company then reformulated the soy milk
product, removing the Kombu seaweed, after tracing the unsafe levels of iodine to the soy milk products with

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added Kombu. The reformulated now meets food safety standards and will return to stores and cafes as soon as
possible.

Case study #5 

Taco Bell E.coli contamination (2006)
Problem:
In 2006, an E.Coli outbreak was linked to Taco Bell Restaurants in the Northeastern United States. 71 customers
reported symptoms matching those caused by E. Coli 0157. Five States reported illness associated with the Taco
Bell outbreak including; New Jersey (33), New York (22), Pennsylvania (13), Delaware (2), and South Carolina
(1).

Strategy:
Taking immediate action, the Company closed all restaurants in the outbreak area, and began an extensive
investigation alongside the CDC and FDA to uncover the source of the contamination. The investigation linking
the likely source of the contamination points to the shredded lettuce used in many of the fast food products.The
company temporarily closed nearly 60 stores in the affected areas including; New York, New Jersey,
Pennsylvania, and Delaware. Taco Bell released a statement regarding the contamination, nothing the change in
produce suppliers for the affected region, as a precautionary measure.

Goals and Objectives 

1. Position Starbucks as an honest company who acts with integrity and puts the company first.
2. Contain the perception of the impact and ease fears and anxieties of customers.
3. Starbucks will provide accurate and timely information to the public when products are at risk of falling
below quality standards.

Position Statement 

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Starbucks is eliminating any issues and problems related to the occurred contamination. As a company whose

mission values transparency, affected customers will be assisted in a timely, honest, and respectful manner.

Starbucks will spare no resource to maintain the good faith of its customers.

Action Steps 
When a contamination crisis occurs, immediate action is needed to isolate and control the situation. Starbucks
implement the following guidelines and key action steps to manage the crisis:
1. Immediately notify the CEO and executives of the issue.
2. Do not allow any higher level executives who had knowledge of the breach before being public, sell their
shares or stock. Freezing the ability to sell stock prevents the company from appearing selfish and
uncompassionate about the losses/and or damages the customers are suffering.
3. Assess the magnitude of the contamination. What products are contaminated, where did the contamination
occur, is it isolated, and has anyone been affected by the contamination, if so, how many?
4. After assessing the contamination, the products must be recalled from all sources.
5. Prepare the CEO for a Press Conference with a statement regarding the contamination.
6. Distribute Press Releases to media outlets.
7. Distribute a letter to the Shareholders of the Company.
8. Perform an investigation to review the manufacturers and distributors involved with all products.
9. Implement new and thorough training standards for product handling.
10. Review all scheduled social media posts to verify nothing will appear insensitive or careless in regards to
the breach.

Strategies 
To handle and manage the crisis, Starbucks should apply a strategic plan to clarify issues, build empathy and
understanding, and effectively communicate with its shareholders. Effective crisis handling will reduce fear,
anxiety and uncertainty within the public. As observed in case studies, a crisis can be overcome effectively when
using the right strategies. Regarding contamination, the following strategies should be observed:

23
Acknowledgement/Apology 
With a transparent approach the company can address the problem and state the facts to the public clearly and
concisely. To ensure the crisis is handled quickly and effectively, the company must make it known they are
aware of the issue and take responsibility of the incident. After acknowledging the situation, issue a formal
apology, for the unforeseen circumstance. Inform the public a formal investigation is in progress.

Corrective Action 
Once the contamination has been identified, corrective action will be implemented to eliminate the source of the
problem. Starbucks will recall all contaminated products preventing any further risks to consumers.

Bolstering 
Talking about all the positive contributions the organization has done. This allows us to maintain the company’s
image in a good light. The Starbucks Foundation has partnered with Ethos water to provide clean water for
children in water-stressed countries.

Minimization 
Once the contamination has been identified down to the specific products and an isolated location. The crisis can
be downplayed by minimizing the negative impacts of the contamination.
 

Talking Points/Key Messages

● We have identified the contaminated products, isolated situation, and products have been recalled.
● Quality is of the utmost importance to the company, providing safe standards for all products and services. 

Social Media 

Social media should be utilized as necessary and appropriately.

​Twitter 

24
“Starbucks is reviewing and implementing new safety practices for all product handling. Quality is of the utmost
importance in delivering our very best in what we do.”

Letter to Shareholders 

Dear shareholder,

It is with regret that we inform you of an isolated contamination to our (insert product name). Approximately

“Insert Number Here” of products have been contaminated with (insert contamination source), and a recall has

been placed on the products. Starbucks has immediately alerted the FDA to investigate, as well as hired a

third-party finance investigation company “Insert Company Name Here”. The issues are being addressed with full

force and we know of no stronger actions that have ever taken place in similar situations. The situation is being

monitored 24/7 and practices are already being set in place to prevent a future situation similar to this. We will

keep you informed during every step that is involved and will routinely send updates. We are more passionate

than ever about securing protection for our customers and maintaining the Starbucks mission and values.

We look forward to your continued partnership,

Kevin Johnson

 
 
 
 
 
 
 
For Immediate Release 

25
 Starbucks Corporate Office
2401 Utah Avenue
S Seattle, WA 98134
1-800-Starbuc

News Release For more information:

December 7, 2017 ​ Laura Lehmkuhl
Public Relations Manager
855-463-5151
ll@starbucksco.com

Starbucks acknowledges the product contamination that potentially impacted customers

from “mm/dd/yyyy”- “mm/dd/yyyy”. Approximately, “insert number” of products/stores were
impacted, resulting in health-related concerns in “insert number” of customers/consumers.
An investigation into how the products were jeopardized was opened immediately, with the
product(s) being removed.
Providing high-quality products to customers is Starbucks main priority. Clean and safe
products are important to Starbucks. Since 2001 the Ethos Water Fund, a part of the Starbucks
Foundation, provides children in water-stressed countries with clean drinking water.
Since 1971, Starbucks Coffee Company has been committed to ethically sourcing and
roasting high-quality arabica coffee. Today, with more than 27,000 stores around the globe,
Starbucks is the premier roaster and retailer of specialty coffee in the world. Through our
unwavering commitment to excellence and our guiding principles, we bring the unique Starbucks
Experience to life for every customer through every cup. To share in the experience, please visit
our stores or online at news.starbucks.com and Starbucks.com.

26
 FAQ SHEET 
Q: What products were contaminated?

A: ​At this time, we are conducting an investigation along with the FDA to rule out all causes of

contamination. As of now, we have discovered the (insert products) have been contaminated by (insert

cause of contamination).

Q: Have the contaminated products been recalled?

A: ​As the investigation continues, we have recalled all of our (insert products). To ensure the safety of our

consumers, we are working to isolate the situation. The customers safety is the utmost importance to our

company, please do not consume the (insert products) in case of contamination.

Q: When did the company learn of the contamination?

A: ​The Company first gained knowledge of the contamination on (insert mm/dd/yyyy). It was the utmost

importance that we notify all retailers, customers, and our community of the contamination.

Q: How many customers were affected by the contamination?

A: ​At this time we do not have all the details, but a rough estimate is “###”. We will provide more

information in the near future, as the investigation is still ongoing.

Q: Where did the contamination occur?

A: ​We are continuing with our investigation to uncover the exact location of the contamination. We will

provide more information in the near future, as the investigation is still ongoing.

Q: Are there any harmful side effects from the contamination?

A: ​We are unable to provide any information on any side effects from the contamination. We have not

received any reports of side effects. If you experience any side effects, please contact our helpline at

27
1-800-Starbuc to issue an official report. We will provide more information in the near future, as the

investigation is still ongoing.

28
 Customer Data Breach 
One of the top major crisis Starbucks could face is hacking that steals money from customers through the app or

steals their personal information, emails, passwords, etc. Starbucks mobile payment accounts for 29 percent of

transactions in stores across the U.S. This number is steadily increasing, as tech popularity and convenience grows

for the customers. In April of 2017, Starbucks tested out a new mobile orders only store, to ease the bottleneck of

wait between in-store and mobile orders seen at other stores. Upon researching potential crisis the company could

face within the mobile orders/app system, we looked at these five previous cases of online hacking and breach of

personal customer information.

Case Study #1 

Equifax Hack (2017)

Problem: 

Credit-monitoring company Equifax had a data breach in which 143 million U.S. consumers personal data was

potentially compromised. This includes names, social security numbers, birth dates, addresses, etc., all materials

which can be used fraudulently. 

Strategy: 

Equifax waited six full weeks before alerting the consumers about the breach, leaving their information exposed

and not available to take countermeasures against it. Equifax did not comment on the delay. Equifax senior

executives sold their shares and gathered 1.8 million, however they claimed to have no knowledge of the breach.

The shares were sold right before the breach went public with one of the executives being the Chief Financial

Officer. Offered website for customers to see if their data was stolen, but made them waive the right to sue. This

29
was later revoked but only after backlash from consumers and the media.​ ​The system asked for names and social

security numbers, which people found ironic because that was information that was possibly stolen from them.

“Happy Friday” tweet: After reports of the breach went out, an automated social media tweet saying “Happy

Friday” was sent out. Most saw this inconsiderate and ignorant considering the gravity of the situation of the

breach. Overall, there has been a large dissatisfaction and mockery of Equifax due to how they handled this crisis.

Their company image is damaged due to the poor handling, and experts expect it unlikely they will recover.

Case Study #2 

Uber Pays off Hackers (2017)

Problem: 

In 2016, Uber hid a breach that stole the personal information of 600,000 Uber customers and drivers. When

hackers threatened to release the information, Uber instead paid off the hackers with $100,000 and waited a full

year to tell the public (NY Times).

Strategy: 

The deal was organized by the company’s chief security officer under former CEO Travis Kalanick. Security

officer Joe Sullivan was fired, and Kalanick was removed from CEO in June.​ “​ None of this should have

happened, and I will not make excuses for it,” said Uber’s new Chief Executive Dara Khosroshahi. “While I can’t

erase the past, I can commit on behalf of every Uber employee that we will learn from our mistakes.” Uber is now

facing four lawsuits, including three seeking class-action status. In addition, the attorney generals of five separate

states are have also launched investigations.Uber has faced breach trouble before, but this breach has been blown

30
to such a large magnitude due to the way it was handled, and remaining secretive and performing highly

questionable and unethical business practices.

Case Study #3 

Starbucks App (2017)

Problem:  

A reporter at Buzzfeed explained​ that she received an email saying that she had reloaded $100 onto her Starbuck

mobile app from the credit card she had on file. The thing is, she hadn't actually reloaded her card. So when she

opened her app, she found that someone had gained access to her information, added the $100 and made three

charges in San Diego that wiped her account. (GH)Dozens of twitter users claimed the same issue.

Strategy: 

Starbucks issued this comment to Goodhousekeeping.com who reached out to the company for comment, "first

and foremost, the security of our customer's information is critically important and Starbucks remains resolute in

protecting that information and has a team of engineers dedicated to advancing security and fraud prevention,

given unauthorized account activity is an industry-wide challenge. As a result, we see only a tiny fraction of one

percent of account holders impacted, significantly reducing fraudulent activity to a level vastly better than industry

average. We strongly encourage our customers to follow ​best practices​ to protect their accounts and, if we are

made aware of any unauthorized activity, we work with our customers directly to ensure that their account

remains whole.”

Case Study #4 

31
Starbucks App (2015)
​

Problem: 

In March of 2015, it was revealed that Starbucks apps were hacked with customers getting money drained from their

personal accounts and loaded onto gift cards. These gift cards were loaded with money, and the hackers would then pocket

the cash. It took one customer two weeks to get his $550 back after he had reported it stolen. He claims he watched as gift

cards were loaded with his money and there was no way for him to stop. (CITE)​ ​There was no secondary authorization for

the purchases and no way for the customers to stop them. It allows hackers to enter your account, load money on a gift card,

and then pocket the cash.

Strategy: 

In a s​tatement, the company said, "to protect their security, customers are encouraged to use different usernames

and passwords for different sites, especially those that keep financial information." They denied that any real

information was stolen aside from usernames and passwords. They minimized the impact of the hack.

Case Study #5 

​Target Credit Data Stolen (2013)

Problem:  

Target shoppers in between November 27 and December 15, 2013 were at risk for stolen credit card information.

Customer names, credit or debit card numbers, expiration dates and CVVs were involved in the information theft,

Target said. Hackers use all of this data to make replicas and steal money from accounts. 

Strategy:  

Target said it would offer affected customers a free credit monitoring service and set up a telephone hotline. It also

offered a storewide 10% discount on Saturday and Sunday. The company said it "began investigating the incident

32
as soon as we learned of it" through a "leading third-party forensics firm." The company said it also notified banks

and law enforcement. CEO Gregg Steinhafel said "the cause of this issue has been addressed and you can shop

with confidence at Target." He did not say how he knew customer data was no longer being stolen, nor how the

hackers managed to swipe the credit card data.

Goals and Objectives 

1. Position Starbucks as an honest company who acts with integrity, and puts the customers first.

2. Contain the perception of the impact and ease fears and anxieties of customers.

Strategies 
To handle and manage the crisis, Starbucks should apply a strategic plan to clarify issues, build empathy and
understanding, and effectively communicate with its shareholders. Effective crisis handling will reduce fear,
anxiety and uncertainty within the public. As observed in case studies, a crisis can be overcome effectively when
using the right strategies. Regarding contamination, the following strategies should be observed:

Acknowledgment 

In the case of a breach of customer’s personal data and credit information, once the breach is discovered Starbucks

will be transparent about the issue. Customers will be alerted immediately if there's a possibility that their data has

been potentially stolen. Alerting the customers will allow them to withdraw their credit information from the app,

and to take countermeasures. As seen in the Equifax hack, waiting to alert customers of the breach positions the

company as selfish and uncompassionate. Customers have a strong bond and connection with Starbucks, and the

longer the company waits before alerting customers of the hack, the more suspicious and selfish the company

33
seems. Also, we want to avoid legal issues such as the ones Uber are facing for not immediately reporting stolen

data, and do not want to push the boundaries in case we can be sued for neglecting to alert customers.

Bolstering 

Once the breach has been addressed, remind the public of the positive impact Starbucks has on communities.

Reiterate Starbucks’ key values and mission statement, to act with courage and to “being present, connecting with

transparency, dignity, and respect”. Starbucks is involved globally and within the community, being mindful of

the social impact they have and can inspire. The company should talk about the programs they have that help

youth, veterans and military families, and the increasing diversity.

Compensation 

Any fraudulent purchases will be reimbursed by the company. Customers will not be penalized for purchases they

did not make and Starbucks will provide assistance in identifying involvement in the breach. Previous account

benefits and rewards will not be lost and will be transferred to the new account customers create.

Talking Points 

● Starbucks customers are family. We have taken care of them for all their coffee needs and will continue to

take care of them during this time of uncertainty.

● Starbucks believes in working with dignity and will remain transparent and treat customers with respect

regarding this issue.

● Preventive measures are already being enacted to ensure no future breach can occur.

34
Position Statement 

Starbucks is exercising all resources to resolve the concerns with the data breach. As a company whose mission

values transparency, affected customers will be assisted in a timely, honest, and respectful manner. Starbucks will

spare no resource to maintain the good faith of its customers.

Action Steps 

1. Immediately notify the CEO and executives of the breach.

2. Do not allow any higher level executives who had knowledge of the breach before becoming public

knowledge sell their shares or stock. Freezing the ability to sell stock prevents the company from

appearing selfish and not compassionate about the losses/ and or damages the customers are suffering.

3. Contact law enforcement and a third-party forensics firm to conduct a thorough investigation of the breach.

4. No later than 24 hours after knowledge of the hack and magnitude has been confirmed, alert all customers

using the Starbucks app through their email of the possibility of a breach.

5. Advise customers to change passwords and usernames, and remove the form of payment saved on the card.

6. Once the magnitude of the breach has been evaluated and if the company knows which accounts

specifically have been breached, Starbucks will reach out specifically to those customers and offer refunds

for any fraudulent purchases.

7. Prepare a press release for the media with a statement from CEO Kevin Johnson addressing the breach and

what the company is doing to remedy the situation.

8. Review all scheduled social media posts to verify nothing will appear insensitive or careless in regards to

the breach.  

35
Letter to Shareholders 

Dear shareholder,

It is with regret that we inform you of a data breach that has affected customers utilizing the Starbucks mobile

app. Approximately “Insert Number Here” accounts have been impacted, with customer personal data and

payment information possibly accessed. Starbucks has immediately alerted law enforcement to investigate, as well

as hired a third-party finance investigation company “Insert Company Name Here”. The issues are being

addressed with full force and we know of no stronger actions that have ever taken place in similar situations. The

situation is being monitored 24/7 and practices are already being set in place to prevent a future situation similar

to this. We will keep you informed during every step that is involved and will routinely send updates. We are

more passionate than ever about securing protection for our customers and maintaining the Starbucks mission and

values.

We look forward to your continued partnership,

Kevin Johnson 

Social Media 

Social media should be utilized as necessary and appropriately.

Facebook 

“Starbucks acknowledges the customer data breach that potentially affected customers using the online mobile

app. For more information, visit ​www.starbucks​.com/newsroom”

(A link to the press release in the Newsroom will be provided.)

 
36
 
Immediate Release 

Starbucks Corporate Office

2401 Utah Avenue
S Seattle, WA 98134
1-800-Starbuc
News Release ​ ​For More Information:
December 7, 2017 ​ ​ Amanda Barajas
Public Relations Manager
855-463-5353
ab@starbucksco.com

Starbucks acknowledges data breach involving mobile app

Starbucks confirmed today it is aware of the unauthorized access to payment card data
that may have impacted customers utilizing the Starbucks mobile app. Starbucks is working
closely with law enforcement and financial institutions to identify and resolve the issue.
“Starbucks believes in working with dignity and respect and is exercising all measures to
ensure customers can utilize the app securely. We are deeply involved in the local communities
and see our customers as family. Starbucks believes in treating others as you would like to be
treated, so any customers who may have had information accessed will be treated with the
utmost respect and care”, said CEO Kevin Johnson.
Starbucks immediately alerted authorities when it was aware that accounts were accessed
unauthorized, and is using all available company and third-party resources forward in efforts to
remedy the issue. The data breach was isolated to mobile app users, customers who made card
purchases in-store were not affected in any way.
Since 1971, Starbucks Coffee Company has been committed to ethically sourcing and
roasting high-quality arabica coffee. Today, with more than 27,000 stores around the globe,
Starbucks is the premier roaster and retailer of specialty coffee in the world. Through our

37
unwavering commitment to excellence and our guiding principles, we bring the unique Starbucks
Experience to life for every customer through every cup. To share in the experience, please visit
our stores or online at news.starbucks.com and Starbucks.com.
###

38
 FAQ SHEET 

Q: How was the customer data breached?

A:​ At this time an investigation is still in progress. We are working with both law enforcement and a

third-party company to detect all the details of the breach. One way customers can protect themselves is

to create strong and unique passwords.

Q: How many customers have been affected?

A: ​At this time we do not have all the details, but a rough estimate is “####” out of the “#####” active

accounts we have.

Q: When did the company first gain knowledge of the breach?

A: ​The company first gained knowledge of the breach on “mm/dd/yyyy”, and alerted customers the

following day. It was important to us that we let customers know as soon as possible.

Q: What is going to happen to the customers who had their data and/or money stolen?

A: ​Any fraudulent purchases will be reimbursed, and customers can contact Starbucks Help-Line to

further investigate the statuses of their information and accounts.

Q: What measures are being taken to prevent the breach from occurring again?

A:​ We are planning to review our security processes and authentication to ensure no breach can be

possible in the future. We are going to ensure customers using the mobile app feel safe.

Q: Who is responsible for the breach?

A: ​At this time there is not a certain entity that we can identify as responsible, but we will provide more

information in the future.

39
 Employee Misconduct
A major crisis Starbucks could face is employee misconduct. Employees stealing customer info, customer
mistreatment, tainting brand's name, foolish behavior, low morale and customer service from work
conditions. Researching potential crisis the company may face, we reviewed these 5 cases of employee
misconduct.

Case Study #1 

McDonald’s Ice Cream Machine (2017)

Problem: 
A teenage McDonald’s worker shared photos on Twitter of “disgusting” conditions at the restaurant in which
he was employed. The photos showed a moldy-looking substance that came from the ice cream machine.
After the photos went viral he posted more from inside the restaurant including ones of frozen food.

Strategy: 
McDonald’s fired the employee and banned him from the location he was employed with. The company used
bolstering as one of their main strategies. They shared their long history of passing regular health department
inspections. With a primary goal of operating a clean and safe restaurant. Conducting regular in-person and
online employee trainings as well as internal inspections to ensure food safety practices. McDonald’s
explained exactly what was pictured, how the tray catches equipment leaks and doesn’t come in contact with
the ice cream.

Case Study #2   

Starbucks Pay Raise/ Hrs Decrease (2016)
Problem: 
Starbucks had raised the wages for its employees. A vocal group of employees claimed even with the raise
there was still a labor crisis. Stores were cutting back on hours and even with the raise in wages employees

40
were still bringing home less money. A petition was started claiming that reducing the hours was killing
morale resulting in decreased customer service. They were asked to maintain the same level of customer
service with fewer people, long lines, and a dirty store.
 
Strategy: 
Starbucks responded with a letter acknowledging the complaints. All reports were reviewed and found the
issues to be isolated incidents. The letter stated complaints were found valid in a small number of the cases,
the deficit in those specific stores have been addressed.Starbucks bolstered on their treatment of their workers
and how they address them as partners created a higher standing than just a crew member.

Case Study #3 

Starbucks Employee Steals Credit Info (2016)

Problem: 
A Starbucks employee stole a woman's credit card information. She was confronted in the drive -through
window while being filmed by the disgruntled customer. The employee tried to deny any wrongdoing before
immediately admitting to the crime. She pleaded with the customer not to press charges, offering to pay back
all the money she stole. With the confession as evidence the customer filed a police report. Later dropping
the charges after the victim's brother posted the video to YouTube. The victim claims that she will no longer
be a customer of Starbucks.
Strategy: 
Starbucks fire the employee and contacted the victim to inform her of the termination, along with working on
a way to address the situation.

Case Study #4   

Starbucks Employee Freaks Out On Customer (2015)

Problem:

41
A customer had ordered a frappuccino with a special cookie straw and was trying to pay with the Starbucks
app. When an employee started shouting at the customer and saying “hello” with a very bad attitude.
Proceeded to snatch the scanner away while the customer was trying to pay and told her to leave and never
come back. The altercation was caught on video and uploaded to Facebook by another customer.
Strategy:
Starbucks addressed the matter stating “the customer's experience is not reflective of the service our partners
provide to customers every day.” The leadership team of the store reached out to the victim to apologize and
make this right. Starbucks fired the employee after the incident. They talked about how they do their best to
hire good people with good hearts who care for customers. The victim was given a $100 gift card by the
company.

Case Study #5 

Domino’s Tainted Brand (2009)

Problem: 
Two employees filmed themselves performing a prank in a Domino’s kitchen and posted it online. One of the
employees put cheese in his nose and then placed the soiled condiment on sandwiches. The video show the
employees violating health codes .
Strategy: 
The two were fired and arrested awaiting felony charges even though food wasn’t delivered. Domino’s
Reputation was damaged, a toughest situation a company can face in terms of a digital crisis. The company
discarded all open food containers costing the company hundreds of dollars. Domino’s decided not to
respond aggressively and underestimated the situation, people were asking what they were doing about it on
social media, but there was no response to their questions even though things were being changed.

Goals and Objectives 

1. Position Starbucks as an honest company who acts with integrity, and puts the customer first.
2. Contain the perception of the impact.

42
Strategies 
To handle and manage the crisis, Starbucks should apply a strategic plan to clarify issues, build empathy and
understanding, and effectively communicate with its shareholders. Effective crisis handling will reduce fear,
anxiety and uncertainty within the public. As observed in case studies, a crisis can be overcome effectively
when using the right strategies. Regarding outburst the following strategies should be observed:

Acknowledgement/Apology 
In the event of employee misconduct Starbucks will be unambiguous with their approach to the issue. There
will be no tolerance for the mistreatment of a customer, crewed or vulgar behavior from employees, or
stealing. Employees are treated as partners and are held to the highest standard when it comes to customer
service. They are are forefront approach to delivering our goals and values. Our apology will consist of, “We
acknowledge the issue and apologize for any mistreatment our customers have experienced. The actions of
these employees do not reflect the core values that we strive to uphold. Starbucks’ goal is to create a positive
and enjoyable experience for customers.”

Mortification 
Once we acknowledge the situation our customers need to know that with dismay we will correct the
wrongdoing. “We are deeply mortified by the mistreatment/and or actions and do our best in screening our
employees and training them in how to interact with customers. Conducting both in-person and online
employee training sessions. It is with our sincerest apologies and regret that this situations has occurred and
we are taking actions to alleviate the issue.”

Minimization/Corrective Action 
We want to contain as much negative press as possible. These types of situations are rare and when they
occur there are repercussions for this type of behavior. Investigations will be conducted resulting in the
suspension or termination based on severity of the incident. If possible, through communication with the
affected party, find a way to mend the matter.

43
Talking Points 
● Starbucks treats its employees as partners and expects them to uphold the company’s values. We do
our best to screen potential employees and provide them with proper training.
● These unfortunate situations do not reflect the type of behavior that we expect and require from our
employees.
● We want our customers to enjoy their visit to Starbucks. Creating relationships with our staff resulting
in orders being know, greeting customers by their name, and treating them like family.
● Starbucks will remain transparent during this time. Working with dignity and respect to restore our
customers faith that this unfortunate event will not stand.
 

Position Statement: 
Starbucks is utilizing all its resources to resolve this issue. The employee has been suspended while an
investigation is being implemented. The company will remain transparent informing customers of
information along the way. We are also working with the involved party to find a way to repair the damage
caused by this situation.
 

Action Steps 
1. Immediately alert the CEO and Executive Board of the issue.
2. Do not allow any higher level executives who had knowledge of the breach before being public sell
their shares or stock. Freezing the ability to sell stock prevents the company from appearing selfish
and uncompassionate about the losses/and or damages the customers are suffering.
3. Conduct an investigation into the issue, suspend employee, terminate employee depending on severity
of the offense, and contact disgruntled customer.
4. Distribute press release to media outlets with a statement from CEO Kevin Johnson addressing the
employee misconduct.

44
 5. Review any scheduled social media post. Freeze any post that will escalate customer dissatisfaction
with the company.
6. Use social media as a way to keep customers updated on our actions to remedy any issues.
7. For any employee/customer issues contact customer to rectify the situation.

Letter to Shareholders 
Dear Shareholder,
We regret to inform you of a situation involving an employee and one of our customers. The incident took
place on “Insert Date/Time,” immediately placing the employee on a suspension while an investigation is
underway. Pending further disciplinary action based on finding from the investigation report. The customer
has been contacted to reach a solution to the situation and will not be pursuing any further legal action. We
will keep you informed during with updates as the information is gathered. We are more passionate than ever
about securing protection for our customers and maintaining the Starbucks mission and values.
We look forward to your continued partnership,
Kevin Johnson 
 

Social Media 

Social media should be utilized as necessary and appropriately.

Tweets 
“We are mortified and apologize for the events that have taken place. The situations is under investigation
and will be dealt with accordingly. Our company prides itself on giving great customer service. Our hope is
to continue to prove this to our loyal customers.”

45
 
For Immediate Release 

Starbucks Corporate Office

2401 Utah Avenue
S Seattle, WA 98134
1-800-Starbuc

News Release ​ ​For More Information:

December 7, 2017 ​ ​ Matthew Valdez
Public Relations Manager
855-463-52552
mv@starbucksco.com

Starbucks confirms employee suspension

The company confirmed today that an investigation has been implemented to receive all
the facts of this morning’s incident. At 8 a.m. this morning a Starbucks employee began shouting
profanity at a customer after the customer tried to pay for their order. Bystanders came to the
customer's defense which escalated into a bigger argument with the employee, and footage was
distributed across social media.
Immediately after management was informed of the situation the employee was
suspended. Since the the employee outburst a video has been uploaded to Youtube by one of the
customers who witnessed the incident occur.
Once the investigation has been completed the employee may face greater repercussions
or complete termination of their position with the company. Starbucks is mortified by the
behavior of one of its staff members.
The CEO said the employee's actions were unacceptable and was disheartened to hear of
the situation.

46
 “We do everything in our power to prevent situations like this from happening, with
online training, in-person training, and screen our potential employees for prior misconduct. I am
deeply sorry that this incident took place. Our mission is to give our customers a great
experience and create relationships with them,” Starbucks CEO Kevin Johnson stated.
Starbucks has reached out to the customer to work together to find a solution. This
behavior is not tolerated and we will keep our customers informed after the investigation.
###

47
 FAQ SHEET 
Q. How did the company hear about the issue?

A:​ The issue was brought to light after management was notified by the afflicted customer.

Q. What is the company doing to remedy the problem?

A:​ An investigation has been implemented along with reaching the company reaching out to the customer

in an effort to find a solution to the issue.

Q. Has the employee been reprimanded?

A: ​The employee has been put on suspension, after the investigation further disciplinary action may take

effect depending on the severity of the situation.

Q. What measures are being taken to prevent this from happening again?

A:​ We do our best in screening applicants, implementing in-person and online trainings, along with

trainings on how to interact with customers.

48
 This crisis management plan is to be used in conjunction with the practices 
stated. Successful crisis management can protect and conserve the company’s 
brand and mission. Although a detailed analysis, every crisis will include 
unknown factors that will demand flexibility and intense monitoring. The role of 
the Crisis Management Team is to work together to best prepare the company for 
continued success in the event of a crisis. 

49
References

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 Distribution of Work

Organizational Issue Analysis Organization:

● Matthew added three to the past/current industry crisis and one in the societal
issues/trends.
● Amanda added five issues to the societal issues/ trends
● Amanda added four issues to the past/current company crisis.
● Laura added to the past/current company crises.
Crisis Strategy Exercise:
● Matthew added the past/current industry crisis.
● Ariyana added two cases studies to the cyber hacking section (Apple Pay and Money
siphoned from the Mobile App) and two case studies to the Contamination section
(Bonsoy Milk contamination and Starbucks Fecal Contamination).
Issues/Vulnerability Worksheet:
● Matthew added into the potential issues section, the past/current company crisis, and
potential crisis.
● Ariyana added to the past/current Industry crises, and the potential crisis.
● Laura added to the past/current company crisis, and the potential crisis.
Case Study Driven Crisis Strategies:
● Matthew did the employee crisis case studies and strategies.
● Ariyana did two of the contamination case studies.
● Amanda did the customer data breach crisis case studies and strategies.
Crisis Plan:
● Matthew completed the employee misconduct section and edited the document with
Amanda.
● Ariyana did the history, products and services, the Main threats, Top three threats and
competition in the risk analysis section, two of the contamination case studies, the letter
to shareholder and FAQ sheet for the Contamination section. Edited the document with
Matthew and Amanda.

59
● Laura did the contamination crisis section, completed the reference page and the Key
Publics/Shareholders section.
● Amy outlined who would fill the crisis management team roles, team member roles,
individual team member responsibilities and individual team member contact information
are outlined.
● Amy planned and finalized the crisis plan layout, graphics and did the Risk Analysis

60