Costco Wholesale: Balanced Scorecard Module. Essay Example

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Boston College
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There are four perspectives in a balanced scorecard that are used to improve an organization performance. They include; the customer perceptive focus on performance targets about customer and market, the internal process perspective focuses on internal operational goals and covers objectives, the learning, and growth perspective deals with the intangible drivers of future. These three perspectives are referred to as lead indicators and finally, the financial standpoint it is considered a lay indicator because it lags behind the other three.

My organization is Costco Wholesale; it has outstanding performance making it the 5th largest store in the country. Our customer base is loyal, and our employees are one of the highest rated. Our performance metrics are customer relationships. We offer an exceptional shopping experience for our clients, who coming back not only to our retail deals but also become emotionally linked to the brand. Secondly, employee satisfaction; our average pay is 42 percent higher than our fiercest rival, Sams Club; we have high-quality health insurance benefits among others. This comfort helps our employee to create a forged relationship with the customers that increase our loyal base.

Thirdly, intellectual capital, we invest a lot in training our employee to improve their performance, this improves the employees time spent in executing a single task since they have broader knowledge in the field. And finally, communication effectiveness, our internal communication is just astonishing. The metrics for our comparable organization which is our greatest competitors, Sams Club, includes employee performance metrics, which gives a ball-park estimate of how much an individual employee brings in. Supplier/partner index, tells how the suppliers and partners are performing and Individual goals for the employees.

Our non-comparable organization, Wal-Mart, which the largest employer in the state with thousands of different stores around the world uses close to similar metrics as Sam's Club since it's the parent organization only that its metrics are far better implemented. Like the financial metrics, suppliers/retailers metrics.

All the three organizations are in the same grocery business but at different levels. How these metrics are implementation determines how the companies performances in the overall view. Costco Wholesale idea is simple; it builds a warehouse that is very minimal sells in bulk and keeps frills negligible. Its membership plan has a particular cache that Sam's club doesn't have. It customer targets is more affluent who are less vulnerable to the economic slump and finally has the most outstanding employee performance. On the other hand, Sam's Club is owned by Wal-Mart, it offers a membership similar to Costcos, but it doesnt carry the emotional feeling. Sam's counterpart Wal-Mart is the biggest threats; its customer base is middle-class Americans that keeps a check on how and where to spend, it suffers the focus on low-income groups compared to Costco who are more resilient in times of economic uncertainty. Costco offers fewer but higher quality products than Sam's vast array of items that fail to create brand loyalty. Costco is also family oriented separated/divorced parents are easily managed by their employees benefits plan which is hard to find in most retailers.

Wal-Mart has successful supply chain management; it is committed to a business model of driving cost out of supply chains to enable consumers to save money and live better, they barely spend money on advertisements. Wal-Mart and Costco share a common trait which is the ability to keep customers coming back. Wal-Mart profits come at the expense of their employees, they are paid as little as it could get away with, and it built a vast computerized distribution network to feed its stores. Thats why 44% of employees leave after the first year compared to 6% of Costco. Wal-Mart has also embraced technology that serves a vital role in its supply chain management. I think this is an excellent initiative that other retailers need to copy.

Costco Wholesale employee treatments are highly regarded by almost all the critics, but that either doesn't come with its expenses. On the side of the employee, some are complaining that the working hours are not consistent hence had to plan. It is also hard for an employee to move up the ladder since seniority passes experience and hard work. Besides they also need to improve their supply chain management.

With the best consumer loyalty, it hard to satisfy every other personal but I think striking a balance to accommodate most of it employee needs is vital. The above listed are some of the most complaints filed by staff. I also believe my organization needs to spend more on suppliers and retailers. An example of Wal-Mart supply chains which leads to fewer links and track down to find the best price from the vendor who is in place to ensure they can meet demand. Also, they should consider offering the potential suppliers long-term and high-volume purchases in exchange for the lowest possible prices. They should also consider expanding the products they offer to more variety. With the implementation of these steps, even Wal-Mart will not be a threat anymore considering their indigent employee empowerment and retention.



Nolan. M(2017). People Metrics: Costco Case Study: Employee Passion Increases Employee Retention and Customer Engagement. Https://Www.Peoplemetrics,Com/Blog.

Vulpen. E(2017). Analytics in HR: 21 Employee Performance Metrics. Https://Www.Analyticsinhr,Com/Blog.

Brown. M(2017). Business Finance: 9 Magic Metrics Your Organization Needs To Adopt. Https://Businessfinancemag.Com/Technology.

Bryant .S (2015). Investopedia: Business Model Analysis: Costo Vs Sams Club (WMT, TGT). Https://Www.Investopedia.Com/Articles.


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