AAllen Module 6 Case Study Pile It High and Let It Fly at Costco 06-23-21

Module 6: Case Study Pile it High and Let it Fly at Costco
Adrianne Allen
Rasmussen University
B433/MAN4320 Section 01 Human Resource Recruitment and Selection
06-23-21
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With scanning & barcode indexing, COSTCO can now quickly access accounts payable & legal
documents. They recouped the cost of the solution in the first eleven months of its operation and
saved more than $7 million in labor & payment terms discounts. Costco Wholesale Corporation
implemented a high-volume Captivation Capture scanning and barcode indexing process for
accounts payable, legal, and employee documents. The Challenge Costco operates an
international chain of more than 386 membership warehouses that carry brand name merchandise
at substantially lower prices targeted for small to medium-sized businesses. For Costco to
provide high quality products at lower prices, it had to communicate quickly and effectively with
thousands of vendors. The company could no longer afford slow response times when accessing
accounts payable documents such as purchase orders, debit memos, or invoices. There was no
direct access to these transaction documents. The image quality from microfilming was
unsatisfactory, and storage space was becoming limited. Costco also processes and stores many
legal documents, including agreements and claims, which need to be stored and accessed easily.
They began searching for a technology that could handle the growing volume of paper,
microfilm, and microfiche. The Image Source Solution The original solution was designed and
integrated by Image Source executive staff members in 1992. They utilized a largely unknown
product from a start-up software company located in Simi-Valley, California, named Optika. That
software company would later become a recognized leader in the Enterprise Content
Management software industry. Costco utilizes Oracle Imaging and Process Management
software for content storage and retrieval. Captivation Capture is used for image scanning and
automated barcode indexing process. Initially, 50 Costco users scanned approximately 25,000
documents per day, equaling 550,000 images per month and 6,600,000 per year (Image
Resource, n.d.).
However, the assessment methods Costco uses are:
 Work samples
The work sample is a piece of actual work that a candidate will complete. Usually, it'll be
closely related to the job they applied to. For example, an SEO specialist can be asked to
conduct keyword research for one specific topic, an accountant could be asked to apply a
few formulas, and a developer may be asked to write a short piece of code. These talent
assessment tools are the most effective in predicting job performance.
 Job simulations
You may have heard of the famous interview question, "Can you sell me this pen?". It's
usually presented to salespeople to evaluate skills like persuasion and thinking on their
feet. This is what a job simulation is. This type of talent assessment is similar to the work
sample, but it involves more on-the-spot work. A job simulation can be done during the
interview or via online hiring assessment tools. For example, you can send assessments to
candidates that ask them to handle a disgruntled customer over chat, do a presentation, or
sell something a bit more complex than a pen.
 Cognitive ability testing
Cognitive ability tests can also be called "Intelligence tests" or "General Aptitude Tests."
They usually include numerical and verbal reasoning and logic exercises, but they can
also branch out to memory, problem-solving, attention to detail, and more. These talent
assessments help you evaluate candidates' general intelligence and comprehend various
concepts and solve fundamental problems.
 AI-powered video interviews
Asynchronous interviews have started becoming more and more popular: this type of
interview lets candidates record answers to questions and allows interviewers to evaluate
the answers at their own time. Apart from the convenience of these interviews, AI
technology has also turned them into talent assessment tools. For example, face-scanning
algorithms can be used to assess candidates' tone, word choice, and other factors to
determine the best person for the job. Companies like Hire Vue have developed this kind
of technology.
 Job trials
A tried-and-true way to judge a candidate's ability to perform specific duties, as well as
how they fit in your existing team. Candidates will usually work for a day or two at an
agreed-upon pay rate. That way, both candidate and employer can see if they're well-
matched.
 Exercises and games
These are the more obscure talent assessments. Exercises are usually done in group
interviews where the interviewers may ask candidates to work together to solve a
problem or debate a particular issue. The hiring team will observe and conclude each
candidate's abilities and attitude. A more popular variation may be hackathons that
companies often hold for coding applicants (Bika, n.d).
Therefore, I can learn from Costco is How to retain employees. Costco has an astonishingly
high employee retention rate of 94%. Retailers typically struggle to retain employees long-term,
especially hourly workers. But Costco has kept employees happy and loyal over the years by
consistently offering above-average retail wages and comprehensive medical and dental benefits,
even to part-time employees. Their stellar customer service is another aspect to learn. Costco
routinely has one of the highest Net Promoter Scores for retailers and recently topped
Newsweek's Best Customer Service 2019 survey for superstores and warehouse clubs. Retailers
can achieve stellar customer service ratings like Costco by doing these three things:
Promote from within. 76% of Costco managers start as hourly employees, meaning they know
how to empower front-line workers and approach common customer service complaints.
Have strong values. Costco's "do the right thing" motto is more than words on paper. Costo scans
every customer's receipt before they leave to make sure they were not overcharged. When Costco
found out a shirt they advertised as 100% silk wasn't, they contacted every customer who
purchased that product and offered a refund.
Be transparent. Despite being one of the largest retailers in the world, if you call Costco's
corporate customer service, it is easy to speak to a human associate. When you speak with
Costco's customer service, whether in-person or in-store, they are trained to provide
straightforward answers, not scripted apologies (Hayashi, 2019).
However, Costco leadership clarifies that they value, respect, and view and develop their
employees as top priorities. Examples: Costco pays more than other retailers, with an average
employee making about $21/hour. Costco provides about 90% of its employees with health
insurance and other benefits (Spaulding, n.d).
Costco does practice what they preach; they communicate an inspiring vision to their employees.
The vision of Costco is that the organization helps people make ends meet, helps businesses be
more efficient and serve customers better, and is a positive force in the communities where its
warehouses reside.
Costco's values are summed up in the phrase "always do the right thing, even when it hurts."
Costco lives this out in the way it faithfully serves its members, the way it treats employees like
family, and the positive things it does for communities.
Because Costco deliberately lives out these aspirations, its reputation is stellar. As a result,
Costco's members trust that the company will provide quality goods and services at an attractive
price and be safe for its members and the people they love. The level of customer loyalty Costco
has developed with its members is the envy of every retailer. Costco provides career
opportunities for its employees. The fact that Costco's senior executives started out working on
the front lines in warehouses is a testament to upward career mobility. The job security Costco
has provided also shows that it values employees as human beings. They also give their
employees a voice. Costco provides career opportunities for its employees. The fact that Costco's
senior executives started out working on the front lines in warehouses is a testament to upward
career mobility. Costco's job security also shows that it values employees as human beings
(Stallard, 2017).
In conclusion, HR technology is critical. Managers use HR technology, employees, HR
professionals, IT, and operations departments, all in different ways to improve their business.
Implementing HR technology within an organization enables managers to gather, collect, and
deliver information and communicate with employees more quickly and efficiently. Overall, HR
technology provides managers with decision-making tools to help manage costs and reduce the
time spent on administrative and legal compliance work while maintaining an efficient and
effective workforce to deliver quality service (Synerion, 2011).
References
1. Team Synerion. May 9, 2011. The Importance of Technology in Human Resource
Management. Retrieved from The Importance of Technology in Human Resource
Management (synerion.com)
2. Hayashi, Randy. February 12, 2019. 8 Things Retailers Can Learn from Costco (and one
thing not to follow). Retrieved from 8 Things Retailers Can Learn from Costco (and One
Thing NOT to Follow) | Payment Depot
3. Bika, Nikoletta. 2021. 6 Talent Assessment Methods to use for recruiting in your
company. Retrieved from 6 talent assessment methods to use for effective recruiting
(workable.com)
4. Image Source Inc. 2021. Costco Utilizes Content Management to Improve AP, Legal &
HR Processes. Retrieved from Costco-Case-Study.pdf (imagesourceinc.com)
5. Spaulding, Susan. February 7, 2016. Costco: How they view and Treat their employees is
a highly profitable differentiator. Retrieved from COSTCO: How They View and Treat
Their Employees Is a Highly Profitable Differentiator | Advisorpedia
6. Stallard, Michael Lee. August 24, 2017. 3 Factors that make Costco America’s best
employer. Retrieved from 3 factors that make Costco America's best employer |
SmartBrief
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Module 6: Case Study Pile it High and Let it Fly at Costco

B433/MAN4320 Section 01 Human Resource Recruitment and Selection

assessment tools are the most effective in predicting job performance.

sell something a bit more complex than a pen.

 Cognitive ability testing

concepts and solve fundamental problems.

A tried-and-true way to judge a candidate's ability to perform specific duties, as well as

 Exercises and games

companies often hold for coding applicants (Bika, n.d).

purchased that product and offered a refund.

straightforward answers, not scripted apologies (Hayashi, 2019).

insurance and other benefits (Spaulding, n.d).

family, and the positive things it does for communities.

In conclusion, HR technology is critical. Managers use HR technology, employees, HR

Implementing HR technology within an organization enables managers to gather, collect, and

effective workforce to deliver quality service (Synerion, 2011).

1. Team Synerion. May 9, 2011. The Importance of Technology in Human Resource

Management. Retrieved from The Importance of Technology in Human Resource

Thing NOT to Follow) | Payment Depot

HR Processes. Retrieved from Costco-Case-Study.pdf (imagesourceinc.com)

Their Employees Is a Highly Profitable Differentiator | Advisorpedia

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