Thinking About Benevolence Goverment Essay

1259 words - 6 pages

Nowadays, we live in such a fast paced society where everything around us is faster and better than before. The economics are playing a more and more important role in people's daily life. Each individual cannot be separated from the commodity. Some companies in the market were a great success. One reason is that the company's leaders put benevolent to business management. The thought of a benevolent originates from Mencius’ ideas. The meaning of the word “benevolent” is the characterized by or expressing goodwill or kindly feelings. In the history of China’s traditional thought, Mencius is the first person who applies benevolent in politics. Although that era is long gone, Mencius’ idea is ...view middle of the document...

As of July 2012, Costco is the second largest retailer in the United States. Wal-Mart and Costco are competitive in very different ways. Costco gets the good recommend and admission from their employees and customers with special management style, benevolent government. In the following sections I will begin by introducing the methods of management from Costco. Then I will explain why Costco could be so successful.

Costco’s core idea is obey the law, take care of their members, take care of their employees, respect their suppliers, and reward their shareholders. Pay high wages are a part of Costco’s benevolent government. That may sound obvious, but achieves the goal really well. In contrast to Wal-Mart, look out for its shareholders' best interests first. Costco always offers good quality products at discounted prices. At the same time, the company pays the highest wages for their general staff. At Costco, its average hourly wage is $17 an hour, but the average pay of a full-time worker at Wal-Mart is $10.11 an hour. Labor costs at Costco are more expensive than other companies. However, Costco is not suffering a loss, because pay a lot wages for employees. Specific reasons are as follows. Form employees’ perspective, they get enough benefits from their job, so they will work harder than before for keeping the job or promotion. They feel they can have a career at Costco, because they believe it is worth to do that. At the same time, the company efficiency enormously enhanced and create more benefits. "There is constant churn in the retail industry, which has one of the highest turnover rates of any business,” says John Challenger, CEO of Challenger Gray. Low wages may result in separation rate increase. Because people cannot find the security on low wage jobs. Too much personnel changes could lead to human resource cost increase and decreased effectiveness. Because the company needs to spend time and money training new employees, and new employees need time to adapt to the environment. From a long-term perspective, pay low wage bring more losses than gains. Benevolent government can help employees to build confidence to the company.

On the premise of quality assurance, Costco’s another practice provides low-price to consumers. Some analysts think Costco treats its customers too generous, it will threat to the interests of its shareholders. In fact, this practice makes Costco become well-established and reliable. People for a long time to buy Costco’s goods, and companies get more profit. Based on an index value of 100 on May 1, 2001, Costco’s stock has risen 55 percent during that time period, while Wal-Mart’s has fallen 10 percent. In the decision of short-term interests and long-term interest, some companies chose the former. These...

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