Organizational Analysis

Organizational Analysis

Michael Murrell

MGT 330

January 5, 2011

Donna Clayburn

Introduction

Organizational Analysis

Costco began under the Price Club name opening its doors in San Diego, California out of a converted airplane hangar. In September 15, 1983 Costco was founded by James (Jim) Sinegal and Jeffrey Brotman and open its first doors out of Seattle Washington under the brand name Kirkland. Costco was the first company to ever to grow from zero to $3 billion in sales in less than 6 years. In 1993, Costco and Price Club merged forming PriceCostco with over 206 locations generating some 16 billion dollars in sales annual.

Costco is a member’s only business open to all its members to shop for their needs ranging from office supplies, furniture, resale items for other businesses, and restaurant supplies. Costco does not compromise on the quality of their goods; this is way Costco is able to provide its members with the very best quality product available.

The External/Internal Factors of Costco is in the fact that Costco became the first company ever to grow from zero to $3 billion in sales in less than six years. The goal of internal versus external sourcing is to secure needed items at the best possible cost, while making optimum use of the resources of the organization. Factors influencing the decision may include: cost, spare capacity within the organization, the need for tight quality and scheduling control, flexibility, the enhancement of skills that can then be used in other ways, volume and economies of scale, utilization of existing personnel, the need for secrecy, capital and financing requirements, and the potential reliability of supply” (Internal versus External sourcing, para. 1).

Costco Mission is to bring to bring the best and highest quality goods it its members at the lowest prices possible, while providing its members with excellence services as well.

Conclusion

Costco is one of the world’s fastest-growing companies in the...