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Working At Costco Case Study Essay

PART I: SHORT RESPONSE Directions: Please answer each of the following questions and provide examples from the text, if applicable. Each response should be at least two paragraphs in length and be written in complete sentences. 1. Under what conditions will an employee be likely to perceive that his or her psychological contract has been broken? There are several ways an employee might perceive his or her psychological contract has been breached or broken. One such way is the failure of an organization to live up to their promises.

This might be wages, advancement, or treatment in the workplace, among other things. An employee might also perceive his or her contract has been broken when observing a breach of fellow employee’s contract in instances such as lay offs. This causes the observing individual to question his or her job security. How an organization treats others in a breach of psychological contract is also observed and has a similar effect on the observer. (p. 216) 2. Why are accurate performance appraisals a key ingredient in having a motivated workforce?

The goal of an appraisal is to render feedback to the employee that increases intrinsic motivation. In contrast, an inaccurate appraisal lessens motivation and misdirects input the employee receives. With out an accurate performance appraisal the employee may feel unappreciated and will not adequately perceive their value to the organization. (p. 217) 3. How can performance appraisals be used to form high-performing work teams? Managers can use the information from performance appraisals to select employees that display higher than normal talent and a greater task performance.

These employees can be grouped into high-performance work teams. Doing this allows the managers to more effectively utilize the talents of their employees. (p. 219) 4. Is a certain level of stress necessary to motivate employees to perform at a high level? Why or why not? The Inverted U-graph can be used to demonstrate the relationship between stress and levels of performance. Stress up to the apex of the graph is considered positive because it motivates the individual’s performance. Stress beyond the apex is negative stress and we can see motivation in the work place decline.

This concept is illustrated in the motivational theories. (p. 250) 5. Why might some employees be reluctant to use an employee assistance program? Employees might be reluctant to utilize employee assistance programs in fear that what they disclose might endanger their careers. Confidentiality is paramount to the success of certain EAPs. Therefore, an employee must be guaranteed discretion above all in enlisting these programs. (p. 268)

PART II: CASE STUDY – VALUING EMPLOYEES AT COSTCO Directions: Read “Closing Case: Valuing Employees at Costco” (p. 41). Visit the Costco website (http://www. costco. com/ jobs. html) and then go to the Internet and conduct a search on “working at Costco reviews. ” Then answer each of the following questions and provide examples from the text, if applicable. Each response should be at least two paragraphs in length and be written in complete sentences. Be sure that you cite your sources. Your paper must have at least one reference to the text. Please use proper APA citation when using any source including the textbook.

Please visit the Academic Resource Center (ARC) for concise APA guidelines. Questions 1. Can organizations treat their employees very well and still remain competitive? Please explain. As the Costco model demonstrates, it is possible to treat and pay their employees well and still remain competitive and even out perform in some aspects. By treating their employees as part of the company, offering benefits, and descent wages, Costco is able to save money on the back end because it experiences lower turnover.

Part of treating employees well, to Costco, also means that its upper level employees and CEOs aren’t paid lavishly. This is one way it is able to afford to treat the employees so well. (p. 241) 2. What are some of the ways that Costco treats their employees better than their competitors and keeps their turnover rate so low? By offering benefits and higher wages than their competitors to even the part time employees, Costco is able to retain more employees than their competitors. Costco goes one step further and covers the majority of co-funded benefits such as health insurance.

The industry average for company heath insurance dictates that employees contribute 25% to the total cost, Costco employees are only asked to contribute 8%. (p. 241) 3. After reading the reviews on the internet, do you still think that Costco is a good place to work? Why or why not? Provide examples of positive responses and negative responses for working at Costco. How does Costco help their employees manage stress? What do you think the level of stress is for the managers at Costco? I think Costco is an excellent place to work for those still in College or young in their careers.

It offers a stable and satisfying environment to work with great pay and benefits. However, I do not think it is an environment that I would want to be in for my entire career. As you get promoted and are endowed with more authority and responsibility, the pay increases are minimal. Although I applaud this approach and understand that it works for the company, I am not of the mindset required to bare that burden. Costco has a wealth of employee benefits that are geared toward the well-being of its employees.

Along with the typical benefits that help manage the stress of health and retirement, Costco also has other benefits that are useful for employees. Employees that are experiencing financial stressors have at their disposal a program that can help them get back a repossessed car. This is actually quite brilliant because it ensures the employee has a way to get to work. Through “Assist America” employees have an abundance of programs to help assist them with personal stressors in the event of even the most bizarre situations.

Because of the general atmosphere of the Costco employees and the availability of employee benefits, I think managers would not experience too much in the way of stress. Outside of the lack of real pay difference between a cashier and a manager there is nothing that seems to me to pose an over abundance of stress. Granted, If I was placed in a retail environment, I would probably not do so hot, but then I am not equipped or even the right fit for that company or retail management for that matter.

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