Costco Company in relation to Prince

Introduction

There are several ideas that are present from prince that are applicable by Costco Company.  These ideas are essential in ensuring various strategies are employed involving production and financial status. The management considerations are directed in giving reasons why the company is successful or unsuccessful from using the principles from “prince”. The other issues covered are on the application of the “prince” ideas sometimes contributing the company to become unsuccessful in its operations.

The ideas, such as being more ruthless and courageous as in the “prince”, improvement of the quality of products and ensuring it produces the best products and services, enables the company to capture a large market share. Competitive advantage is also a principle that has been obtained from the Prince. It keeps the company far ahead of the others and it is the reason the company is in business. The company borrows the principle of assessing the risks, to enable it to know the amount of threat that it is posed to the company. The principle that “Prince” wins the battle reluctantly is emulated by the company. Machiavelli also presents ideas of how Cisco management engages on setting up strategies as well as formulating them. He adds on the importance of incorporating technological advancement in the business field. Therefore, according to the “prince” principles some factors are essential in contributing development whereas it depends on mode of application.  

Why Costco Company is successful in its operation for using “the prince” principles

According to Machiavelli ideas that are applied by the company there are principles from the Prince to deal with arising circumstances he has to be more ruthless and courageous. This scenario is applied by the Costco Company with aim of improving the quality of its products and captures other market points in the region. The company builds a reputation that makes it to be more loved in the region; hence it gets a wider market segment. “And the usual course of affairs is that, as soon as a powerful foreigner enters a country, all the subject states are drawn to him, moved by the hatred which they feel against The Prince 9 Nicolo Machiavelli the ruling power. So that in respect to these subject states he has not to take any trouble to gain them over to himself, for the whole of them quickly rally to the state which he has acquired there (Dyck & Neubert, 2010).”

 New princes normally face difficulties as explained by this book, on the other hand, an existing Prince may face the same problems faced by a new prince. The Costco Company applies this principal to deal with companies that might pose a threat to its production. It is also able to identify the possible risks that might arise from its operations (Tayeb, 2005). This is vital, since it puts the company in a better position that helps it to deal with the competitors, Costa company gains competitive advantage by applying this principle. The company can identify the weak points in the market, and, hence can increase its operations and deal with the competitors.

Prince understands its competitive advantage because it is the reason it is in business. With the knowledge of the market’s weak points, the company develops well-defined strategies and makes consistent decisions in all operations of the company. The company uses these widely pursed strategies with the aim to achieve growth in sales, profits and assets. The strategies and decisions made for expansion of the company makes it to grow and therefore survive. Through use of resources and unique skills, strategies that competitors cannot implement are implemented effectively.

 The Prince wins a battle with little reluctance, since he targets the weak targets. This concept is explained in the book and means that it is not necessary for Prince to have a strong Army to conquer. This concept applies to the Costco Company; “it targets those customers that need high-quality products at low prices” (Edwards, Ferner, & Sisson, People and the process of management in the multinational company : a review and some illustrations, 1999). The company hence generates huge market base, and in turn enjoys large profits in the long run. This is not a competitive advantage concept being applied by the company to relinquish competition from the competitors.

Depending with explanation from the book, it is easier for the Prince to conquer people that speak the same national language, than conquer those that do not have a common language.  Prince gets an easier time with customers it can communicate with efficiently. He is, hence able to conquer large territory effectively than its competitors who instead look for large territories which do not have a common language. This is presented through the following quotation regarding the foreigner and power. These reasons have made the company to become more successful in its operations.

Costco stand on Machiavelli ideas

Regarding the ideas presented by Machiavelli, Costco management has taken different direction in achievement of their goals (Rahe, 2008). The management has engaged strategies that are related to the current business operation. This is a business, financial and market share strategies that have incorporated technological advance in enhancing competitive advantages. Contrary to the competitors, the company’s strategies coordinate and integrate the activities of the functional areas that make up the firm to achieve the long-term objectives of the organization. The issues considered by the management on Machiavelli ideas are presence of the chain of practices that cannot apply in the global market. The Costco Company has different branches in different countries and cities and hence some of the Machiavelli ideas such as hereditary rule cannot be applied.

Business strategies that are required in improving performance and productivity are based to the technological improvement (Edwards, Ferner, & Sisson, People and the process of management in the multinational company : a review and some illustrations, 1999). For example, when important files are stored in computers rather than being in drawers, the information becomes easily accessible in any branch of the company in whichever country. Advancement in technology increases the rate at which information and communication travels. When communication flows that fast, the world becomes smaller and smaller, impacting the way business in the company is done. This also introduces the company in the application of the current ideas and hence the creation of the best channel for competition in the market. Most of the competitors are utilizing improved strategies and hence Costco have to advance and use innovation to achieve its competitive objectives.

Financial stand of the company are based on the need and the level of the company. Costco is a multinational company and hence its budget covers a larger perspective (Dyck & Neubert, 2010). This requires the incorporation of the company management is coming up with an appropriate strategy leading to enhancement in fund utilization. The companies have a high rate of expenses and therefore cannot depend with one unit of leadership. Costco has a diversified department, and hence one rule of hereditary cannot work in reference to Machiavelli ideas.

Increasing market share is the most important thing for the company. For Costco, increasing market share is based on diversification of its operation with the aim of attracting customers. Market share is a desired asset for the competing firms. The best considerations are directed in achievement of the set goals in increasing the market size. The management is trusted for the operation in different branches and hence calling upon proper supervisory role. Therefore, it is advisable for the management to work accordingly in enhancing increased quality of services and performance to attract customers.

The reason that makes Machiavelli ideas inappropriate with the Costco operation is based on diversification.  The companies have different branches that offer similar services. This ensures an increase in market size and share (Burke & Cooper, 2005). According to the Machiavelli ideas, a form of governance was directed from a single source. The company depends with the completion in increasing their sales through wholesale in different regions. Therefore, they cannot depend with the same governance from the management in different branches.

Principalities application in authorization of the company’s management hinders development in other branches. This is directed from the quote “A principality is created either by the people or by the nobles, accordingly as one or other of them has the opportunity; for the nobles, seeing they cannot withstand the people, begin to cry up the reputation of one of themselves, and they make him a prince, so that under his shadow they can give vent to their ambitions. The people, finding they cannot resist the nobles, also cry up the reputation of one of them, and make him a prince so as to be defended by his authority.”  This ensures the company management and policy making are on centralized at the head office. Decentralization of the power among the branches would enhance proper performance and attaining the objective. Regarding the work being undertaken, the management has to ensure the roles of the management at the branch level are independent (Mayrhofer, 2013). Branch management has proper understanding of the region. The relationships among the Costco Company are directed through the managerial decisions that are based at regional level.

The applications of these ideas are supposed to be done at one source of the managerial authority. Having different branches at different countries ensures the company is capable of outsourcing proper management. The managerial source is responsible all the levels of an organization being focused to one purpose and vision. The management discusses and decides on strategies and functions more quickly and reacts to the market dynamics fast enough. Having such a managerial source reduces the conflicts that arise in the branches throughout the countries. The managerial team understands that it is in charge and therefore ensuring that there is control and accountability. The issues that are core to the company management are based on the development and attaining objective and goals.

Costco Company has applied the saying, which states that, who he becomes a Prince through the favor of the people, should ascertain that they rule the people in good terms; they ought not to oppress them. The company holds this belief since it could not have been there if it were not for its consumers.  The company regards its consumers, and, hence provides the required products at the right terms. This is basically important to the company as it maintains a good relationship with the consumers.

Machiavelli outlines that, he who wishes to be followed must learn to demand and command. The company applies this concept since it can dictate its activities across different regions. For instance, the company has more branches that enable it to reach more consumers (Edwards, Ferner, & Sisson, 1999). It hence applies the beliefs and ideologies of the author. The author initiates new orders of things, and this applies to the Costco company since they are able to introduce new products with an understanding that the products might not do well in the market. It takes time for new products to be recognized.

Conclusion

The company adherence to some proposed quotes from Machiavelli book has enabled its survival in the market. The company faces stiff competition from Amazon and other companies. Though the company has the largest warehouse for its product, competitors pose a big threat (Mayrhofer, 2013). The company has opened many sites for the sale of its products, and this has turned to be mutual beneficial to this company since it has increased its customers base in different countries.

Regarding the political study in the Machiavelli presentation, shows that inheritance of the positions in various positions. This provided guidelines that are applied in succession of the position and hence making government to become a family issue. This process of governance has a lot of side effects in ruling and does not reflect the people’s interest. Therefore, it is appropriate for the leaders to ensure they give back to people and community. Assistance in solving their issues reflecting community needs.

In relation to Costco Company, management has the role of ensuring productivity and performances are enhanced throughout. At the branch levels, branch managers have the responsibility based at that level.  The consideration regarding objective and goal are based from the company’s mission and vision. Direction of the work especially in the management does not go with the Machiavelli ideas. The manifestations of the appropriate guidance are done from the management level either at local level. This helps in diversification of the power of management basing on customer’s need and pressure from the performance and productivity.

References

Burke, R. J., & Cooper, C. L. ( 2005). Reinventing human resource management : challenges and new directions. London: Routledge.

Dyck, B., & Neubert, M. J. (2010). Management : current practices and new directions. Boston, MA: Houghton Mifflin.

Edwards, P. K., Ferner, A., & Sisson, K. (1999). People and the process of management in the multinational company : a review and some illustrations. Coventry : University of Warwick.

Edwards, P. K., Ferner, A., & Sisson, K. (1999). People and the process of management in the multinational company : a review and some illustrations. Coventry : University of Warwick.

Mayrhofer, U. (2013). Management of multinational companies : a French perspective. Houndmills, Basingstoke: Palgrave Macmillan.

Otterbeck, L. ( 1981). The Management of headquarters : subsidiary relationships in multinational corporations. Aldershot, Hampshire: Gower.

Rahe, P. A. (2008). Against throne and altar : Machiavelli and political theory under the English Republic. Cambridge: Cambridge Univ. Press.

Tayeb, M. H. ( 2005). International human resource management : a multinational company perspective. Oxford ; New York: Oxford University Press.