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Avner Barnea, CI Consultant (IL) |
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Avner Barnea is former senior member of the Israeli Intelligence Community, and holder of an MA from the Hebrew University of Jerusalem and graduate the Top Executive Program in Marketing Management from the Tel Aviv University Graduate School of Business Administration. He is a consultant in the field of Competitive Intelligence [CI] and Business Strategy in Israel and abroad. He is a guest lecturer on CI in MBA programs among them at the Hebrew University of Jerusalem Business School and at the Business School of the Academic Studies Division of the College of Management and in addition in various business executives training programs among them the Lahav Executive Education Programs, The Faculty of Management, and Tel Aviv University. He has an intensive experience in the successful integration of CI systems into Israeli corporations.
Lack of Peripheral Vision - How Starbucks Failed in Israel
Towards the beginning of April 2003, Starbucks, the world leader of coffee shops with 6000 locations worldwide, ended its operation in Israel and closed its 6 stores after almost two years of tough struggle to survive. This is the only country where Starbucks raised a white flag. Starbucks has faced difficulties in the early stages of entering to various countries but it has never reached a stage when its senior management decided to raise-up their hands admitting they could not compete successfully.
The key points in the Starbucks Israel (SI) business strategy were to launch 20 shops in 2-3 years, mostly in the Tel Aviv area and to become the largest coffee shop chain in Israel by using the standardization of Starbucks as is while investing heavily in advertising and public relations. SI did not believe it was critical to listen to the local customers and hoped that they will change and rapidly adapt themselves to what the leading global brand is offering. In this case, it seems that the warnings that SI was moving in the wrong direction had been repeatedly ignored and the sense of a threat did not exist.
The poor results achieved by SI were mainly a result of lack of peripheral scanning and reading incorrectly the signals from the market. Adding to this the fragile commitment showed by the owners of SI brings to the conclusion that SI has made almost every mistake and could not expect to make it in the Israeli competitive coffee shops market. It seems that a global brand, usually American, has to be ready to make adjustments to the local culture, known as glocalization, and by avoiding to do it, the chances to succeed are narrowing. Since its failure, Starbucks did not try to make another attempt in Israel.
Presentation Goals:
- Learn how to use active scanning of the markets and competitors
- Understand the concept of Peripheral Vision and its CI applications
- Learn about the role and the responsibility of the senior management in understanding the dynamic environment and implement it into the business strategy
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