COSTCO AND THEIR PERFORMANCE MANAGEMENT PRACTICES.



ABOUT COSTCO:
Costco Wholesale Corporation, Headquarters in Issaquah, WA, founded in 1983, is ranked #35 on the Fortune 500 rankings of the largest worldwide corporations by total revenue. A member of Costco’s leadership team the retailer’s second CEO, W. Craig Jelinek, who is familiar with Costco’s business strategies has enabled Costco to earn the title of America’s best large employer. Costco is widespread, with over 770 branches and is a major service provider in merchandise, cash & carry and warehouse club. The number of employees working for Costco are 245000 (2018), full time and part time, worldwide.


COSTCO’S EMPLOYEES:
“When employees are happy, they are your very best ambassadors.”- Jim Sinegal, CEO, Costco.
The emphasis on employees at Costco is the key to the company’s success and ability to consistently provide a better shopping experience for its members.

COSTCO’S CULTURE:
Costco has also created a distinct culture and that has led to higher productivity and better performance from the employees and higher satisfaction. Costco’s executives focus on putting their employees first, which has lead to low employee turnover rates. When employees feel important and that there is value in the work that they do, it makes it harder to leave their current position and seek out new work. In long run, this increased rate of retention and has allowed Costco to save on labor costs while continuing to provide employees with significant wages and benefit packages.

PERFORMANCE MANAGEMENT PRACTICES:
  1. The employees are promoted from within and due to the opportunities of growth they last long at the organization.
  2. All the employees receive competitive wages, a benefits plan and other bonuses and good health benefits.
  3. Reward system makes it easier for Costco to successfully set expectations for its entire workforce.The above-average wages that the employees are paid sets a benchmark that encourages stronger performance.
  4. Encourages workers to come up with suggestions. It also assigns them responsibility and authority to make responsible decisions, which works as a major motivation for employees.
  5. Gives managers autonomy to experiment with their departments or stores to boost sales or shave expenses if necessary.
  6. Focuses on collaboration and not pushing employees to deliver more than they can.
  7. Employees do not feel any pressure related to performance and are given ample space to work and grow.


Costco spends less on hiring and retention because of their employees performance management practices and make them feel like they're a family. Happier employees are always more focused and deliver with dedication as they know that they are valued in the company. In fact it is not difficult to come across people here who have been working there for more than ten years.




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