Putting People First in Business
Well, it's about time that someone is getting it right! We recently read Tom's blog about Phil Purcell getting a $106 million separation package. Now, meet Jim Sinegal, chief executive of Costco Wholesale, whose annual salary is a mere $350,000.
In a recent article in the New York Times (17 July 2005, "How Costco Became the Anti-Wal-Mart"), we see that Costco puts their customers and their people first. They pay the bulk of health care premiums, offer benefits after only 6 months of employment, and they believe that "a happy employee is a productive long-term employee."
Some analysts think that Jim Sinegal is too benevolent, that he gives his employees too much, and that his prices are too low. Yet, Costco has about half the warehouse retailer market, and their stock price has risen more than 10% in the last 12 months, according to the New York Times.
Jim continues to go to bat for his employees, has negotiated favorable terms with the union, and still manages a booming business. Hats off to you, Jim Sinegal, for not following the crowd and for re-imagining how business can really be run!