The Seattle Times had a couple of stories over the weekend about Costco’s changing leadership, which takes place in January as Jim Sinegal retires and is succeeded by Craig Jelinek.
Some excerpts:
• Jelinek on whether he might change corporate policies on pay and benefits... “We're not going to change it.
“Now it's fashionable to pay good benefits if you can, and we get credited for something people used to say was a no-no. Nothing changed about the way we did business. We just stayed to our principles — it's what we do, take care of customers and employees and the people who are selling us merchandise, because it's important that your suppliers make money.
“You need to run your business for the long term, and the only way you're going to be around for the long term is if you take care of employees and customers. If you don't, bad things are going to happen to you.”
• Sinegal on pay and benefits... “It's not altruistic. This is good business, hiring good people and paying them good wages and providing good jobs for them and opportunities for a career. If you accept the premise that we pay the highest wages in our industry [hourly workers average more than $20 an hour, including bonuses] and have the richest health care and benefit plan in our industry and the lowest price on merchandise and run the lowest-cost operation, then it must follow we're getting better productivity.”
• Jelinek on his new role as CEO... “My view is your first responsibility is to protect your customer, to continue to have the best value possible out there for the customer. You have to protect your employees. The last thing I want to do is become a casualty like [some other] companies.
“The only way that will happen is if you start to change your core values of what you represent. If you start to do that, you'll start to have distrust with employees about who you are, and you'll start to change the culture of your company. That's the one thing that you don't want to do.”
• Sinegal on the future... “I would hope that 10 years from now, Costco would have sales of probably close to twice what they are right now and that they're significantly more profitable and that we have an even bigger presence internationally than we have today, that we have twice as many members shopping with us, and that we have established ourselves as a leading consumer advocate in the countries where we do business.
“We think our mere presence in a community lowers the price of goods for everybody, even if they don't shop with us, because competition is a very good thing. Sometimes we moan about competition, but if we didn't have good competitors out there, we would get very lazy and not be a very good company.”
Some excerpts:
• Jelinek on whether he might change corporate policies on pay and benefits... “We're not going to change it.
“Now it's fashionable to pay good benefits if you can, and we get credited for something people used to say was a no-no. Nothing changed about the way we did business. We just stayed to our principles — it's what we do, take care of customers and employees and the people who are selling us merchandise, because it's important that your suppliers make money.
“You need to run your business for the long term, and the only way you're going to be around for the long term is if you take care of employees and customers. If you don't, bad things are going to happen to you.”
• Sinegal on pay and benefits... “It's not altruistic. This is good business, hiring good people and paying them good wages and providing good jobs for them and opportunities for a career. If you accept the premise that we pay the highest wages in our industry [hourly workers average more than $20 an hour, including bonuses] and have the richest health care and benefit plan in our industry and the lowest price on merchandise and run the lowest-cost operation, then it must follow we're getting better productivity.”
• Jelinek on his new role as CEO... “My view is your first responsibility is to protect your customer, to continue to have the best value possible out there for the customer. You have to protect your employees. The last thing I want to do is become a casualty like [some other] companies.
“The only way that will happen is if you start to change your core values of what you represent. If you start to do that, you'll start to have distrust with employees about who you are, and you'll start to change the culture of your company. That's the one thing that you don't want to do.”
• Sinegal on the future... “I would hope that 10 years from now, Costco would have sales of probably close to twice what they are right now and that they're significantly more profitable and that we have an even bigger presence internationally than we have today, that we have twice as many members shopping with us, and that we have established ourselves as a leading consumer advocate in the countries where we do business.
“We think our mere presence in a community lowers the price of goods for everybody, even if they don't shop with us, because competition is a very good thing. Sometimes we moan about competition, but if we didn't have good competitors out there, we would get very lazy and not be a very good company.”
- KC's View:
