Costco vs Walmart
Are employees engaged in their jobs? Not according to Gallup's "State of the American Workplace" published in 2015. They found that 68% of US workers are not engaged at work. A decent wage might have something to do with that. In 2004, the average hourly worker at Walmart made $9.64 (Bloomberg BusinessWeek, April11, 2014). At Costco, the number was $15.97.
In April 2004, Bill Dreher, an analyst at Deutsche Bank, stated that "At Costco, it's better to be an employee or a customer than a shareholder," The response by Costco CEO James D. Senegal? "Paying your employees well is not only the right thing to do but it makes for good business.“
Who was right? The graph to the right (source Bloomberg) shows the performance of Walmart vs Costco since the above analyst statement was made in 2014.
CVS Smoking Ban
“CVS, the nation's second-largest pharmacy chain, said Wednesday it would stop selling all cigarettes and tobacco products nationwide by October, saying they have no place in a drugstore company that is trying to become more of a health-care.
For CVS, the move will be costly. The drugstore chain estimates it will forgo $2 billion in annual revenue from tobacco and other sundries as a result. That hit on revenue will shave about six to nine cents a share off of operating earnings this year and about 17 cents annually from next year's earnings. ” (CVS to Stop Selling Cigarettes, Wall Street Journal, Feb. 5, 2014)
SouthWest Airlines after 9/11
“On Sept. 12, 2001, there were no commercial flights in the United States. It was uncertain when airlines would be permitted to start flying again—or how many customers would be on them. Airlines faced not only the tragedy of 9/11 but the fact that economy was entering a recession. So almost immediately, all the U.S. airlines, save one, did what so many U.S. corporations are particularly skilled at doing: they began announcing tens of thousands of layoffs. Today the one airline that didn't cut staff, Southwest, still has never had an involuntary layoff in its almost 40-year history. It's now the largest domestic U.S. airline and has a market capitalization bigger than all its domestic competitors combined. As its former head of human resources once told me: "If people are your most important assets, why would you get rid of them?“ (Newsweek, 2/4/2010, “The Case Against Layoffs: They Often Backfire”)
(Creating a Sustainable Supply Chain)
“Fifteen years ago, Nike underwent intense scrutiny and brutal attacks for its global supply chain management policies and priorities. People across the world were burning Nike shoes instead of wearing them; customers were boycotting Nike products; and in 1998 the company’s earnings dropped by 69%.
So, what began fifteen years ago as Nike’s horror show of globalization has evolved today into the inspirational story of its transformation to a sustainable global enterprise. Nike is passionately committed to “build a sustainable business and create value for Nike and [its] stakeholders,” and not just its shareholders. Sustainability is no longer about risk management for Nike; it is about growth. Leaders and employees of the company recognize the interconnection between sustainability, brand enhancement, capital efficiency and profitability — Nike’s growth strategies are built on these four pillars. CEO and president Mark Parker is also greatly committed to “decoupling” Nike’s “profitable growth from constrained resources.” (Dr. Aarti Sharma , “Swoosh and Sustainability: Nike's Emergence as a Global Sustainable Brand”, May 17, 2013)