As a frequent consumer of its products, I have often pondered the Starbucks phenomenon. A ‘Tall’ tea at Starbucks cost one pound sterling and 45 pence. To get your tall tea, you may have to stand in line for anything between ten and fifteen minutes waiting to be served – often longer at airports. When this happens, being of an impatient nature, I start reflecting on the deeper structure of the experience. If I were to put a value on my time at say, six pounds an hour – approximately the minimum wage in the UK – I would conclude that the real cost to me of a ‘Tall’ tea at Starbucks was approximately two pounds and 45 pence, the extra pound being the cost to me in time lost in waiting in line. So why did I not go somewhere else where I could sit down and get a waiter to serve me? It would almost certainly cost me less.
I never managed to fathom my irrational willingness to stand in line at Starbucks until today when, while waiting in line, I picked up a leaflet entitled Starbucks Beverage Order Guide. Then the penny dropped. If you are willing to re-frame your experience of waiting in line, you discover that it has a value way beyond that of the time you think you are wasting. Properly considered, Starbucks is offering you some basic training in complexity theory. This is what I must unconsciously have intuited.
To see this, return for a moment to the leaflet. Open it up and on the first inside page you discover that you have a choice of beverage size: Venti (large), Grande (medium) and Tall (small). Why the specialized jargon? Clearly, to avoid confusion. An elephant can be ‘large’, for example, and so referring to your beverage as ‘large’ would incur a loss of precision that could lead to your tea being served in something the size of a bath. Alternatively, a bug can be small, and ordering a ‘small’ tea could then make it difficult for the bug to then fit in the cup. Better, then, stick to Starbucks’ private language and just live with the resulting cognitive overload you incur as you struggle to relate it to something more familiar than an elephant. On the second inside page of the leaflet, you are introduced to the options: decaf, shots, syrup, milk, custom, drink, and ice. Each of these options is further subdivided so as to expand your choice – and further increase your cognitive overload. It is important to understand that these options are not all mutually exclusive so that you could, if you chose to, order a beverage that is extra hot and then ask to have ice added to it. Finally, on the back page of the leaflet, you are given the descriptions of the beverages to which all these sizes and options apply: caffe latte, cappuccino, caffe mocha, caramel macchiato, expresso, Americano, and filter coffee.
While perusing this leaflet, it finally dawned on me that what was being described here was a consumer’s version of what mathematicians refer to as a combinatorial problem and that the whole of Starbucks’ strategy consisted of expanding the choices available to you from the one or two traditional options – ie, coffee or decaf – to several hundred billion. Now if you think about it, with that number of choices available, you are more than likely to be ordering a drink that no one in the history of the universe has ever drunk before. Call this the mystery of mass customization. This is designed to confirm to you that you are a unique individual since, by confronting head-on the computational complexity of the choices that Starbucks puts before you, you succeed in creating for yourself a unique drink. Talk about differentiation!
If my intuition is correct, then all this standing in line is not designed to waste my time at all. Rather it is a subtle and non-obtrusive way of securing the time necessary for me to compute what my order is going to be – call it computational queuing. I have now realized that, once framed in this way, and given the plethora of choices available, the waiting lines at Starbucks are not nearly long enough since, if the service ever got efficient – and God preserve us from this - it could lead to unnecessarily hasty choices. It is now obvious to me that if one really wants to enjoy a truly unique Starbucks experience, then one should be queuing for at least an hour. This would mean the line spilling out of the shop and probably going round the block. Now, if Starbucks ever decided to expand their menu….
Comments (5)
And so, Max, after standing in line do you then order a regular coffee?
Posted by Mary Boone | October 13, 2007 1:55 PM
Posted on October 13, 2007 13:55
Why managers of businesses make their customers queue, rather than providing more staff, is something of a mystery. Maybe the manager has confused the length of the queue with how busy he is. But there is no relationship here, because each staff member cannot process more business just because there is a queue, unless you count the way queues put both customers and staff under pressure to move more quickly. Perhaps the manager is saving one hour of staff time (£6), but because of it, making 100 people wait 10 mins each (total time stolen from customers 16 hours), he can see the £6 but he can't see the 16 hours. My conclusion is that any manager who makes his customers queue has an extremely high disregard for his customers, and so should be avoided at all costs.
Posted by karl jeffery | October 15, 2007 11:09 AM
Posted on October 15, 2007 11:09
I would like to say that I found your posts to be wonderful. I would check in each morning to see if you had added something to the blog. The other folks have been great to read in terms of learning about some of the methods and thinking, but your posts were literary pieces as well. I find this uncommon in the technical world, where data and bulletized arguments make for near nonreadability! Your posts were exceptional. Thank you.
The point regarding queuing is well taken. As a person who visits the same Starbuck's every morning at about the same time, I order the same thing, I sit in the same chair (if it is available), and I know at least a little bit about most of the people who work there and many of the regulars. As a friend says, Starbuck's is the modern day Cheer's, the neighborhood pub where everyone knows you. Except you go in the morning and drink caffeine! In this particular Starbuck's the queue can get very long some mornings and then shrinks to nothing. It is classic OR (OA in Britain) that queues behave this way and says essentially nothing about the attitude of management towards customers. Now if it were a chronic issue, that would be different. And if there were cash registers not being manned or positions at the espresso machine unoccupied, I would say they were not staffing well, but there is only so much capacity in a given store layout. (Sorry, my analytical side comes out once in a while!)
Wayne
Posted by Wayne Zandbergen | October 18, 2007 3:09 AM
Posted on October 18, 2007 03:09
1. Mary, the answer is 'yes', I do indeed order a regular coffee. I consider this to be economically irrational since if I were to put a price on the value of my time, then, firstly, I have refused to engage in the computational opportunities that spending time in the waiting line would offer me - thus lowering my opportunity costs - if I ordered a more complex product. Secondly, I have now minimized the value of the purchase relative to the cost of waiting for it. Now, neoclassical economist keep telling us that we humans are 'rational' economic agents and that we maximise our marginal utilities. Perhaps, unconsciously, my own behaviour demonstrates that there is at least one economic agent for whom rationality is both episodic and transient - if he is not alone, we have the reason, perhaps, why Starbucks flourishes.
2. Karl, you overlook the possibility that some people actually enjoy queuing. Queuing for its own sake is something that older Britons got socialized to during the second world war. Now they can't kick the habit. Some don't even want to be served lest the experience of the service they have been waiting for undermines the experience of waiting for it - to travel hopefully (ie, to queue) is often better than to arrive (ie, to be served).
3. Wayne, the Starbucks queue becomes a problem at US airports when you have to catch a flight and you are waiting in line with 20 people before you. Starbucks is applying a fast-food business model to the delivery of complex products. As you point out, however, they cannot just expand the number of tills or servers spontaneously to cope with the peaks. My impression, though, is that they are not using information technology to good effect. They face what we might call a 'micrologistics' problem.
Posted by Max Boisot | October 18, 2007 8:01 AM
Posted on October 18, 2007 08:01
I still remember the menu of a pub on Inis Mór, June 2001, Aran Islands, IKM pre-conference event, the very early Cynefin days:
- toast with ham
- toast with cheese
- toast with tomato
- toast with ham and cheese
- toast with ham and tomato
- toast with cheese and tomato
- toast with ham, cheese, and tomato
Now let's just imagine that Starbucks would explicitely expand all combinations? They would need to provide a Venti, large, Grande or Tall book, not a small leaflet.
Posted by christianhauck | November 1, 2007 10:54 AM
Posted on November 1, 2007 10:54