The Costco story: good employers get good results

August 1st, 2005 by Julie Ferguson

Early in my working life, I was employed for a local plastics manufacturer. Among my responsibilities, I was charged with the happy task of planning an annual recognition dinner for longterm employees. It was a big event because we had many 15-, 20-, and 25-year veterans in the work force. Sadly, the concept of longterm employment seems almost quaint today, but at that time, it was held in high regard by both employers and employees alike.
The employment landscape has changed considerably over the last two decades. By and large, neither employers nor employees seem to have much loyalty to each other today. The influence of Wall Street has been corrosive. With companies facing intense pressure to maximize each quarter’s results, many have found that mass layoffs and outsourcings have met with approbation in the form of a few penny gain in stock price. This tendency to immediate gratification has had other negative consequences on the business climate, as well. It appears that at least a few business executives may have sufficient time to meditate on these matters from the privacy of their jail cells.
Breaking away from the herd
It’s a breath of fresh air to read a business success story about Costco, a retail company that is bucking this trend, and its forward-thinking CEO, Jim Sinegal. In a New York Times article entitled How Costco Became the Anti-Wal-Mart, Steven Greenhouse reports on how the company