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Peter Stathakos - Stack Of Toast Microsoft, .NET and Life in General

Ben McConnell from Church of the Customer talks about Costco's treatment of their employee's compared to Wal-Mart. Typical Wall Street thinking is that Costco spends money on their workers rather than beefing up the bottom line for the investors and financial fat cats. Ben is totally right on with his analysis. The real bottom line that most businesses don't get is not what short term stock prices say, it's the employees, their satisfaction and how that is replicated in all facets of the business.


Sure, the top 2% of the company can afford to drive a nice car, take two week vacations four times a year and stay in luxury suites when they travel, but how does that help the company produce a better product? It doesn't. The vice presidents and the CEO may present a nice front to the investors and might help to sell a little more (after all it's all one big old boy's club up there anyway), but does that make the software any more bug-free? More stable? Better UI? Nope on all counts.


By taking care of themselves and the investors, the big wigs are really damaging the company in numerous ways. Employee morale goes a long way. If someone is not happy with their job and especially sees that the company could not care less about them, productivity goes way down and quality is largely reduced. You get that attitude where employees will do the minimum work possible just to stay out of trouble and still appear to be working hard to their superiors.


So, how does a company satisfy both camps? Simple. Small things work miracles. Spend some money on your employees and the medium to long term results will reflect that fact. Costco doesn't break the bank, they spend a bit more on insurance and health care benefits but they reduce their turnover rate to half that of Wal-Mart's. Simple thing.


Personal days, work from home programs, slightly flexible hours, casual dress codes, health, dental and medical insurance programs. They're not that expensive but in the long run the employee is happier and more productive and that makes a HUGE difference in productivity, quality and the satisfaction of your clients. And it'll lower your turnover rate, I guarantee it.


Think about it Big Business, Think about it.


Posted on Tuesday, April 6, 2004 11:47 AM Geek Stuff | Back to top

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