8 ms·

Costco does not hire business school graduates

114 points by chrismealy 13y ago

seivan 13y ago
Love this. I have nothing but utter hate for MBA's.
- crapshoot101 13y ago
  because gross generalizations are fun!
cicloid 13y ago
Even in Mexico, there is a stark contrast between the feeling in the stores and employees treatment from a Costco vs Sam's Club. Also the quality of products sold is very noticeable
salimmadjd 13y ago
My first real start-up job was at the end of 1999 and start of 2000. The company was founded by a few Ivy League MBAs and they hired a bunch more. I found them intimidating a bit and they made sure the relationship stayed that way. We had a lot of meetings with a lot of SATish words thrown back and forth. We had meetings about how to have meetings and on and on... Fast forward the Internet bubble burst, we were ruining out of cash fast and had to downsize. One-by-one the MBAs left and we got more creative, more nimble. I went from a snobed -out engineer (it had a non-leadership connotation at that place) to running engineering and then the product team. We sold the company (not a huge exit but everyone got something) and stayed a year until got fed-up with the labyrinth of our parent company (ran with bunch of sales and MBAs). Here's what I learned from my experience. Many MBAs make good consultants. They can analyze and write a report for you. They're mostly not creative nor can creat anything (or they'd be doing that instead of spending $100,000 in school ). Because they can't creat anything, they have to show their value. Which means a lot of analysis, meetings and meetings about meetings. Resulting in slowdown, reduced innovation and increase in politics.
jedc 13y ago
Obligatory post to what I consider the best framing of MBAs: "It's fine to get an MBA but don't BE an MBA" by Hunter Walk. http://www.hunterwalk.com/2011/12/its-fine-to-get-mba-but-dont-be-mba.html http://www.hunterwalk.com/2011/12/its-fine-to-get-mba-but-do...
sergiosgc 13y ago
An MBA is a powerful tool. It gives you an analytical view on business, coupled with at least introductory understanding of the full range of business activities. However, as with many things in life, a little knowledge is more dangerous than no knowledge. Couple little knowledge with the feeling of self entitlement and you get a recipe for disaster. My main message: Don't go discarding all MBAs just yet. Many are excellent people and magnificent professionals.
- raverbashing 13y ago
  Yes, exactly, it's a tool! Like a drill, like a sledgehammer, like a multimeter. But if you learn to use a drill without an objective and without knowing what you'll want to achieve you'll just drill holes everywhere.
davidw 13y ago
Interesting; Sol Price is mentioned in quite positive terms in this book (at least up to the point where I've read): http://www.amazon.com/dp/B008ZPG704/?tag=dedasys-20 http://www.amazon.com/dp/B008ZPG704/?tag=dedasys-20 - Sam Walton's autobiography.
- paul_f 13y ago
  Minor nit. Sol Price was not a founder of Costco, he was the founder of Price Club. Which was acquired by Costco.
  - gojomo 13y ago
    Bigger nit: that's not the whole story, either. The entity now called Costco was called PriceCostco after the 1993 merger. That they ultimately chose the Costco name doesn't change the dual heritage; founders of either have a fair claim to being founders of the combined entity. But even further: key founder of pre-merger Costco James Sinegal got started in retail working at Sol Price's San Diego-based FedMart and Price Club. He then copied the PriceClub membership/bulk/employee-development model starting from Seattle. (A friend working for pre-merger Costco at the time described it as an almost-friendly rivalry, with each racing to expand the shared model from their home cities into the rest of the US.) So the PriceCostco merger "got the band back together", Price Club was the older and model-foundation entity, but clearly both teams contributed enough to be credited as "founders" of the current behemoth.
- chollida1 13y ago
  And the link without the affiliate portion: http://www.amazon.com/dp/B008ZPG704 http://www.amazon.com/dp/B008ZPG704
  - davidw 13y ago
    davidw on affiliate links: https://news.ycombinator.com/item?id=2813826 https://news.ycombinator.com/item?id=2813826 https://news.ycombinator.com/item?id=4156909 https://news.ycombinator.com/item?id=4156909 https://news.ycombinator.com/item?id=4360330 https://news.ycombinator.com/item?id=4360330 https://news.ycombinator.com/item?id=4402285 https://news.ycombinator.com/item?id=4402285
victorology 13y ago
I don't think it's that Costco has a problem with MBA's. I think if you get on the management track at the company, they will sponsor you through business school. "Costco does not hire business school graduates—thanks to another idiosyncrasy meant to preserve its distinct company culture. It cultivates employees who work the floor in its warehouses and sponsors them through graduate school." It seems like they just want people with experience working at its warehouses so they can get a perspective on how the day to day business operates.
- PakG1 13y ago
  It's not MBAs specifically. It's the business consulting mindset in general that MBAs are taught. Costco wouldn't want for MBAs to come in and do consulting on how to improve their operations because those guys wouldn't have the necessary respect for what Costco finds valuable, which does include their on-the-ground work and unique culture. MBA pattern recognition and recommendations would work well (hopefully) when the situation fits the pattern. Costco is clearly a non-standard retailer, so the question is how MBAs would respond to such non-standard patterns, and whether their recommendations would be good for the long term of that business. Maybe they would offer up excellent advice, maybe not. Costco is just erring on the side of caution and preferring their "home-grown" MBAs, rather than "standard" MBAs.
  - VLM 13y ago
    I can provide you an interesting analogy that may (or may not) resonate with HN readers: It turns out that hiring a guy who's an expert at optimizing I/O systems for databases, to optimize your massive multimedia streaming farm, doesn't usually work. Because one is hyper random access and the other is massively sequential, also typical block size for one is probably measured in K and the other typical transaction size is probably measured in G. And there's certain latency consideration. And probably others. The real question is if costco is successful, why are b-schools charging $100K to churn out cookie cutters that don't cut it in the real world? If costco were swirling down the drain, AND simultaneously rejected "MBA culture" (or HN culture, or 4chan culture, doesn't really matter) then it wouldn't be much of a story. The question is why MBA schools, despite all the worship of their holy paper credential, can't graduate people who apparently know anything about retail, or at least don't know how to be legendarily successful in retail. It would be like a med school that charged $100K but simply decided to not teach their students anything about biochem and then no one seemed to care. "Eh, blood sugar and electrolyte levels, eh, that stuffs hard, lets skip it and do some extra anatomy studies". Or in engineering, "Well, I never really liked finite element analysis and you'll probably not be expected to successfully do it on the job, so here's a engineering degree anyway and best of luck to ya". And no one cares other than a successful, yet fringe industrial company, who doesn't hire eng school grads to do finite element analysis.
codeonfire 13y ago
I highly doubt anyone is trying to earn an MBA because they can't wait to get into retail ops and work in a warehouse.
- VLM 13y ago
  Its an epic marketing fail for the MBA. "We're America's holy frat boy paladins of corrupt crony capitalism inherently and forever above the lower class proles, entitled to adsorb the profit of all as our feudal reward." Um, well, OK then, nice to meet you too. In the real world, turns out they need about a page of car TV ad style small print at the end, like "Not including $100K delivery fee. Not valid for retail sales companies; other exclusions may apply. Offer only valid for well qualified sociopaths. See your local student loan pusher and/or parole officer for further details"
einhverfr 13y ago
One of the obvious benefits to promoting floor workers which is not covered in the article is that the former floor workers know the work realities. One of the biggest sins of hiring MBA's for management is that they don't know the floor realities and therefore they get an analytical view of the business which is simplified in the wrong ways. One solution might be to hire MBA's as floor workers for a minimum of a year before promoting them to management. However, with student loans being what they are, that is not feasible today.
- eru 13y ago
  You could send your former floorworkers to get an MBA, instead.
- swalsh 13y ago
  Target does something like this, when I worked in the corporate office it was a pretty regular thing to send employees to work in various parts around the store to get a feel. Though it was typically only for a week.
kfk 13y ago
There are 25 theories because each one works on a different set of assumptions. As economists can't work with lab experiments, they have to go with lots assumptions using complicated statistical tools. They can't ask businesses because if you go that deep you can't abstract away any useful info. You will get very detailed stuff that nobody will care about. Most of the times people want a petty theory that can be summarized in 10 words (read all the keynesian BS on this). As for the MBA's. Start ups are picky, very picky. They want you to have a github profile, to have a phd, to be a god in what you do. This is mainly resource driven, but that's the fact. Thus, don't come telling me that start up culture is closer to workers because I will call 100 times BS on this. I have never seen a start up giving chances to somebody that does not have god skills, or somebody with a profile that does not involve years of coding or CS. On the other hand, my company took me straight from business school and is giving me the chance to grow from almost nothing (as I did not study finance). Let's not generalize.
- jerf 13y ago
  If it's too hard to gather any data, and it's too hard to do any sort of experimentation to determine if your theories are correct, it isn't time to just wildly theorize... it's time to pack it in and go do something else. Your defense is too powerful. Fortunately, the dismal science isn't actually that dismal... or at least, it doesn't have to be....
  - kfk 13y ago
    Thing is, I am constantly working on concepts to develop a SaaS that could free me from a paid job. I actually do code and do pretty much everything (python (flask...), databases, sql, javascript, css, html, the whole package), because nobody dares to join a "non technical" guy, I have to learn it all. But you know what's the most difficult thing? The business. Oh yeah. I can code an app from scratch, but I still have to convince people to use it. I still have to plan the financials (by the way, how do start up plans look like? Guess-working?). I still have to market it. I still have to make profits. Which brings me to the point. I can't stand this bashing of business people 360 degrees. There are bad business people as there are bad developers. There is bad culture in start ups ("you non technical piece of ...") as there is in business. It's all a matter of degrees and looking around.
yummyfajitas 13y ago
Yeah, the secret of Costco is that they don't hire MBAs. If you actually want to go learn Costco's "secrets" of their basic business model, inventory management and staffing, go read Megan Mcardle's article comparing them to walmart: http://www.thedailybeast.com/articles/2012/11/26/why-can-t-walmart-be-more-like-costco.html http://www.thedailybeast.com/articles/2012/11/26/why-can-t-w... Sadly, the "secret" of $SUCCESSFUL_COMPANY is almost always far more boring than we'd like. I really wish there was a news source that would actually write articles like this which discuss staffing levels, supply chain management and the like.
- ebbv 13y ago
  That piece seems wildly insincere and misses the point, as does anything that just compares Wal Mart to Costco. Usually what people compare is Sam's Club to Costco. Sam's Club is the direct Costco competitor that is also owned by the Waltons. Of course Wal Mart is a different beast than Costco, everybody knows that. But that doesn't mean that Wal Mart couldn't treat its employees better. If anything the facts of McArdle's piece prove that point. (They are making plenty of profit, a lot of which could be reinvested in employees.)
  - yummyfajitas 13y ago
    It's not obvious to Matt Yglesias, to whom McArdle was responding. http://www.slate.com/blogs/moneybox/2012/11/26/walmart_wages_they_could_be_higher.html http://www.slate.com/blogs/moneybox/2012/11/26/walmart_wages...
- VLM 13y ago
  That was an interesting article, thank you. Its a fact packed article and I assume the facts listed are true, although given later comments I do wonder. However her opinion "But Walmart is not just a poor man's Costco." strikes me as being exactly opposite both in examination and analysis of the facts she provides and personal experience. She then spent most of the rest of the article explaining how reality is the exact opposite. Maybe this is a legendary epic editing mistake and she meant to write "Walmart is just a poor man's Costco." but the editing and/or ad sales team made her change it or perhaps just an honest mistake. As a market positioning technique all you need do is find the bottom of the barrel, like Walmart, and position yourself as 10% better. Ta Da instant free positive press. You can make a 5000 word article about it, but this TLDR summary is just as good. I also thought the juxtaposition of the article vs the delivery mechanism was weird. This is a website full of chewing gum for the mind. Linkbait. "Your Tango Finding Nemo: The 10 Most Ridiculous Nicknames For Self-Love". So they're intentionally aiming for the shallow end of the socio-economic pool. And thats perfectly OK. Weekly World News readers and high school dropouts need websites too, the world is big enough that everyone doesn't have to visit HN. However the article author is incredibly condescending to the website's audience and spends a lot of time making fun of their concerns and distancing herself and her twitter feed from what she apparently views as lower class scum, which probably would sound about right in an Economist article (LOL I looked and she does in fact write for the Economist LOL) but why you'd put someone like that on the Daily Beast, which kinda puts the lower in "lower class", mystifies me.
eli_gottlieb 13y ago
Actually, if I had to guess, I'd say it's domain expertise. A lack of MBAs is good, because MBAs turn your company away from getting good at what it actually does/sells and towards generic "being a good company" stuff.
- VLM 13y ago
  Away from producing good products and toward producing good numbers?
  - eli_gottlieb 13y ago
    Bingo. What management thinks is important is its internal metrics. What actually matters in the end is customer demand and cost of production.
mattdeboard 13y ago
You know what Costco really needs? A fucking engineer to design a milk jug that is efficiently stored in bulk and doesn't spill milk all over the damn place when I'm trying to make oatmeal. Source: I Just spilled half the jug all over the damn place.
- cglace 13y ago
  Yeah. I always wondered if they had actually tried using it.
- scrabble 13y ago
  Do they not sell milk bags?
  - mattdeboard 13y ago
    No, this isn't Canada
    - potatolicious 13y ago
      Eastern Canada at that. I grew up in western Canada and was very confused when I moved east.
- goatforce5 13y ago
  Milk bags? http://en.wikipedia.org/wiki/Milk_bag http://en.wikipedia.org/wiki/Milk_bag Costco near Toronto (and maybe Canada generally?) sells vast amounts of milk packaged this way.
  - halostatue 13y ago
    It's a Canadian thing.
    - serge2k 13y ago
      Eastern Canada. Well, not DC anyway.
jmduke 13y ago
Show HN: Look, I found an article that disparages MBAs!
- IAmAI343 13y ago
  It is revenge of the nerds. I don't know if it is a good thing, bad thing, or it doesn't matter but it sure makes a lot of people feel better. And to be honest, the MBAs do have a lot of it coming to themselves, not all of it, but a lot.
sethammons 13y ago
I'm not informed on customer demographic differences between Costco and Walmart, but I'd think that a poor economy will disproportionately affect Walmart due to economically disadvantaged people won't be shopping at Costco in the first place and they tend to be the ones hurt the most in economic downturns. So "better" customers could be leading to better financials on the part of Costco, not just some anti MBA culture that resonates with the HN crowd.
fleaflicker 13y ago
The referenced article: http://www.businessweek.com/articles/2013-06-06/costco-ceo-craig-jelinek-leads-the-cheapest-happiest-company-in-the-world http://www.businessweek.com/articles/2013-06-06/costco-ceo-c...
thehme 13y ago
I heard about the good pay and benefits for workers, and thought it would be great to join as a costumer and cancel my other membership. Just waiting for one to open close by to do this and support these sort of business models.
tokenadult 13y ago
I liked the Business Week article that this article link-spammed from even better. http://www.businessweek.com/printer/articles/123492-costco-ceo-craig-jelinek-leads-the-cheapest-happiest-company-in-the-world http://www.businessweek.com/printer/articles/123492-costco-c... "This week, I’m writing about Costco again because of this wonderful article about the company, on the cover of Bloomberg Businessweek. There’s tons of fascinating info packed inside, even stuff that I, who consider myself to be something of a Costco nerd, didn’t know."
sologoub 13y ago
Looks like a lot of people commenting didn't bother to read the article: "Costco does not hire business school graduates—thanks to another idiosyncrasy meant to preserve its distinct company culture. It cultivates employees who work the floor in its warehouses and sponsors them through graduate school." Note that they do not recruit from B-Schools, but they are happy to send their own employees to graduate school. In the past, working your way up from the bottom in a large company, being sent for an MBA or MBA/JD combo was a relatively standard thing. Several of my professors/acquaintances have taken this track in Citi Group (I think they got renamed) and the like. Amgen, Boeing, Raytheon, Intuit, etc. (I live in SoCal.) have similar policies and practices where they encourage employees to get a graduate degree (be it Business or Engineering). This is not very groundbreaking and is well documented to be a solid strategy for employee development.

114 points by chrismealy 13y ago

seivan 13y ago

Love this. I have nothing but utter hate for MBA's.

crapshoot101 13y ago
because gross generalizations are fun!

cicloid 13y ago

Even in Mexico, there is a stark contrast between the feeling in the stores and employees treatment from a Costco vs Sam's Club. Also the quality of products sold is very noticeable

salimmadjd 13y ago

My first real start-up job was at the end of 1999 and start of 2000. The company was founded by a few Ivy League MBAs and they hired a bunch more. I found them intimidating a bit and they made sure the relationship stayed that way. We had a lot of meetings with a lot of SATish words thrown back and forth. We had meetings about how to have meetings and on and on... Fast forward the Internet bubble burst, we were ruining out of cash fast and had to downsize. One-by-one the MBAs left and we got more creative, more nimble. I went from a snobed -out engineer (it had a non-leadership connotation at that place) to running engineering and then the product team. We sold the company (not a huge exit but everyone got something) and stayed a year until got fed-up with the labyrinth of our parent company (ran with bunch of sales and MBAs). Here's what I learned from my experience. Many MBAs make good consultants. They can analyze and write a report for you. They're mostly not creative nor can creat anything (or they'd be doing that instead of spending $100,000 in school ). Because they can't creat anything, they have to show their value. Which means a lot of analysis, meetings and meetings about meetings. Resulting in slowdown, reduced innovation and increase in politics.

jedc 13y ago

Obligatory post to what I consider the best framing of MBAs: "It's fine to get an MBA but don't BE an MBA" by Hunter Walk. http://www.hunterwalk.com/2011/12/its-fine-to-get-mba-but-dont-be-mba.html http://www.hunterwalk.com/2011/12/its-fine-to-get-mba-but-do...

sergiosgc 13y ago

An MBA is a powerful tool. It gives you an analytical view on business, coupled with at least introductory understanding of the full range of business activities. However, as with many things in life, a little knowledge is more dangerous than no knowledge. Couple little knowledge with the feeling of self entitlement and you get a recipe for disaster. My main message: Don't go discarding all MBAs just yet. Many are excellent people and magnificent professionals.

raverbashing 13y ago
Yes, exactly, it's a tool! Like a drill, like a sledgehammer, like a multimeter. But if you learn to use a drill without an objective and without knowing what you'll want to achieve you'll just drill holes everywhere.

davidw 13y ago

Interesting; Sol Price is mentioned in quite positive terms in this book (at least up to the point where I've read): http://www.amazon.com/dp/B008ZPG704/?tag=dedasys-20 http://www.amazon.com/dp/B008ZPG704/?tag=dedasys-20 - Sam Walton's autobiography.

paul_f 13y ago
Minor nit. Sol Price was not a founder of Costco, he was the founder of Price Club. Which was acquired by Costco.
- gojomo 13y ago
  Bigger nit: that's not the whole story, either. The entity now called Costco was called PriceCostco after the 1993 merger. That they ultimately chose the Costco name doesn't change the dual heritage; founders of either have a fair claim to being founders of the combined entity. But even further: key founder of pre-merger Costco James Sinegal got started in retail working at Sol Price's San Diego-based FedMart and Price Club. He then copied the PriceClub membership/bulk/employee-development model starting from Seattle. (A friend working for pre-merger Costco at the time described it as an almost-friendly rivalry, with each racing to expand the shared model from their home cities into the rest of the US.) So the PriceCostco merger "got the band back together", Price Club was the older and model-foundation entity, but clearly both teams contributed enough to be credited as "founders" of the current behemoth.
chollida1 13y ago
And the link without the affiliate portion: http://www.amazon.com/dp/B008ZPG704 http://www.amazon.com/dp/B008ZPG704
- davidw 13y ago
  davidw on affiliate links: https://news.ycombinator.com/item?id=2813826 https://news.ycombinator.com/item?id=2813826 https://news.ycombinator.com/item?id=4156909 https://news.ycombinator.com/item?id=4156909 https://news.ycombinator.com/item?id=4360330 https://news.ycombinator.com/item?id=4360330 https://news.ycombinator.com/item?id=4402285 https://news.ycombinator.com/item?id=4402285

victorology 13y ago

I don't think it's that Costco has a problem with MBA's. I think if you get on the management track at the company, they will sponsor you through business school. "Costco does not hire business school graduates—thanks to another idiosyncrasy meant to preserve its distinct company culture. It cultivates employees who work the floor in its warehouses and sponsors them through graduate school." It seems like they just want people with experience working at its warehouses so they can get a perspective on how the day to day business operates.

PakG1 13y ago
It's not MBAs specifically. It's the business consulting mindset in general that MBAs are taught. Costco wouldn't want for MBAs to come in and do consulting on how to improve their operations because those guys wouldn't have the necessary respect for what Costco finds valuable, which does include their on-the-ground work and unique culture. MBA pattern recognition and recommendations would work well (hopefully) when the situation fits the pattern. Costco is clearly a non-standard retailer, so the question is how MBAs would respond to such non-standard patterns, and whether their recommendations would be good for the long term of that business. Maybe they would offer up excellent advice, maybe not. Costco is just erring on the side of caution and preferring their "home-grown" MBAs, rather than "standard" MBAs.
- VLM 13y ago
  I can provide you an interesting analogy that may (or may not) resonate with HN readers: It turns out that hiring a guy who's an expert at optimizing I/O systems for databases, to optimize your massive multimedia streaming farm, doesn't usually work. Because one is hyper random access and the other is massively sequential, also typical block size for one is probably measured in K and the other typical transaction size is probably measured in G. And there's certain latency consideration. And probably others. The real question is if costco is successful, why are b-schools charging $100K to churn out cookie cutters that don't cut it in the real world? If costco were swirling down the drain, AND simultaneously rejected "MBA culture" (or HN culture, or 4chan culture, doesn't really matter) then it wouldn't be much of a story. The question is why MBA schools, despite all the worship of their holy paper credential, can't graduate people who apparently know anything about retail, or at least don't know how to be legendarily successful in retail. It would be like a med school that charged $100K but simply decided to not teach their students anything about biochem and then no one seemed to care. "Eh, blood sugar and electrolyte levels, eh, that stuffs hard, lets skip it and do some extra anatomy studies". Or in engineering, "Well, I never really liked finite element analysis and you'll probably not be expected to successfully do it on the job, so here's a engineering degree anyway and best of luck to ya". And no one cares other than a successful, yet fringe industrial company, who doesn't hire eng school grads to do finite element analysis.

codeonfire 13y ago

I highly doubt anyone is trying to earn an MBA because they can't wait to get into retail ops and work in a warehouse.

VLM 13y ago
Its an epic marketing fail for the MBA. "We're America's holy frat boy paladins of corrupt crony capitalism inherently and forever above the lower class proles, entitled to adsorb the profit of all as our feudal reward." Um, well, OK then, nice to meet you too. In the real world, turns out they need about a page of car TV ad style small print at the end, like "Not including $100K delivery fee. Not valid for retail sales companies; other exclusions may apply. Offer only valid for well qualified sociopaths. See your local student loan pusher and/or parole officer for further details"

einhverfr 13y ago

One of the obvious benefits to promoting floor workers which is not covered in the article is that the former floor workers know the work realities. One of the biggest sins of hiring MBA's for management is that they don't know the floor realities and therefore they get an analytical view of the business which is simplified in the wrong ways. One solution might be to hire MBA's as floor workers for a minimum of a year before promoting them to management. However, with student loans being what they are, that is not feasible today.

eru 13y ago
You could send your former floorworkers to get an MBA, instead.
swalsh 13y ago
Target does something like this, when I worked in the corporate office it was a pretty regular thing to send employees to work in various parts around the store to get a feel. Though it was typically only for a week.

kfk 13y ago

There are 25 theories because each one works on a different set of assumptions. As economists can't work with lab experiments, they have to go with lots assumptions using complicated statistical tools. They can't ask businesses because if you go that deep you can't abstract away any useful info. You will get very detailed stuff that nobody will care about. Most of the times people want a petty theory that can be summarized in 10 words (read all the keynesian BS on this). As for the MBA's. Start ups are picky, very picky. They want you to have a github profile, to have a phd, to be a god in what you do. This is mainly resource driven, but that's the fact. Thus, don't come telling me that start up culture is closer to workers because I will call 100 times BS on this. I have never seen a start up giving chances to somebody that does not have god skills, or somebody with a profile that does not involve years of coding or CS. On the other hand, my company took me straight from business school and is giving me the chance to grow from almost nothing (as I did not study finance). Let's not generalize.

jerf 13y ago
If it's too hard to gather any data, and it's too hard to do any sort of experimentation to determine if your theories are correct, it isn't time to just wildly theorize... it's time to pack it in and go do something else. Your defense is too powerful. Fortunately, the dismal science isn't actually that dismal... or at least, it doesn't have to be....
- kfk 13y ago
  Thing is, I am constantly working on concepts to develop a SaaS that could free me from a paid job. I actually do code and do pretty much everything (python (flask...), databases, sql, javascript, css, html, the whole package), because nobody dares to join a "non technical" guy, I have to learn it all. But you know what's the most difficult thing? The business. Oh yeah. I can code an app from scratch, but I still have to convince people to use it. I still have to plan the financials (by the way, how do start up plans look like? Guess-working?). I still have to market it. I still have to make profits. Which brings me to the point. I can't stand this bashing of business people 360 degrees. There are bad business people as there are bad developers. There is bad culture in start ups ("you non technical piece of ...") as there is in business. It's all a matter of degrees and looking around.

yummyfajitas 13y ago

Yeah, the secret of Costco is that they don't hire MBAs. If you actually want to go learn Costco's "secrets" of their basic business model, inventory management and staffing, go read Megan Mcardle's article comparing them to walmart: http://www.thedailybeast.com/articles/2012/11/26/why-can-t-walmart-be-more-like-costco.html http://www.thedailybeast.com/articles/2012/11/26/why-can-t-w... Sadly, the "secret" of $SUCCESSFUL_COMPANY is almost always far more boring than we'd like. I really wish there was a news source that would actually write articles like this which discuss staffing levels, supply chain management and the like.

ebbv 13y ago
That piece seems wildly insincere and misses the point, as does anything that just compares Wal Mart to Costco. Usually what people compare is Sam's Club to Costco. Sam's Club is the direct Costco competitor that is also owned by the Waltons. Of course Wal Mart is a different beast than Costco, everybody knows that. But that doesn't mean that Wal Mart couldn't treat its employees better. If anything the facts of McArdle's piece prove that point. (They are making plenty of profit, a lot of which could be reinvested in employees.)
- yummyfajitas 13y ago
  It's not obvious to Matt Yglesias, to whom McArdle was responding. http://www.slate.com/blogs/moneybox/2012/11/26/walmart_wages_they_could_be_higher.html http://www.slate.com/blogs/moneybox/2012/11/26/walmart_wages...
VLM 13y ago
That was an interesting article, thank you. Its a fact packed article and I assume the facts listed are true, although given later comments I do wonder. However her opinion "But Walmart is not just a poor man's Costco." strikes me as being exactly opposite both in examination and analysis of the facts she provides and personal experience. She then spent most of the rest of the article explaining how reality is the exact opposite. Maybe this is a legendary epic editing mistake and she meant to write "Walmart is just a poor man's Costco." but the editing and/or ad sales team made her change it or perhaps just an honest mistake. As a market positioning technique all you need do is find the bottom of the barrel, like Walmart, and position yourself as 10% better. Ta Da instant free positive press. You can make a 5000 word article about it, but this TLDR summary is just as good. I also thought the juxtaposition of the article vs the delivery mechanism was weird. This is a website full of chewing gum for the mind. Linkbait. "Your Tango Finding Nemo: The 10 Most Ridiculous Nicknames For Self-Love". So they're intentionally aiming for the shallow end of the socio-economic pool. And thats perfectly OK. Weekly World News readers and high school dropouts need websites too, the world is big enough that everyone doesn't have to visit HN. However the article author is incredibly condescending to the website's audience and spends a lot of time making fun of their concerns and distancing herself and her twitter feed from what she apparently views as lower class scum, which probably would sound about right in an Economist article (LOL I looked and she does in fact write for the Economist LOL) but why you'd put someone like that on the Daily Beast, which kinda puts the lower in "lower class", mystifies me.

eli_gottlieb 13y ago

Actually, if I had to guess, I'd say it's domain expertise. A lack of MBAs is good, because MBAs turn your company away from getting good at what it actually does/sells and towards generic "being a good company" stuff.

VLM 13y ago
Away from producing good products and toward producing good numbers?
- eli_gottlieb 13y ago
  Bingo. What management thinks is important is its internal metrics. What actually matters in the end is customer demand and cost of production.

mattdeboard 13y ago

You know what Costco really needs? A fucking engineer to design a milk jug that is efficiently stored in bulk and doesn't spill milk all over the damn place when I'm trying to make oatmeal. Source: I Just spilled half the jug all over the damn place.

cglace 13y ago
Yeah. I always wondered if they had actually tried using it.
scrabble 13y ago
Do they not sell milk bags?
- mattdeboard 13y ago
  No, this isn't Canada
  - potatolicious 13y ago
    Eastern Canada at that. I grew up in western Canada and was very confused when I moved east.
goatforce5 13y ago
Milk bags? http://en.wikipedia.org/wiki/Milk_bag http://en.wikipedia.org/wiki/Milk_bag Costco near Toronto (and maybe Canada generally?) sells vast amounts of milk packaged this way.
- halostatue 13y ago
  It's a Canadian thing.
  - serge2k 13y ago
    Eastern Canada. Well, not DC anyway.

jmduke 13y ago

Show HN: Look, I found an article that disparages MBAs!

IAmAI343 13y ago
It is revenge of the nerds. I don't know if it is a good thing, bad thing, or it doesn't matter but it sure makes a lot of people feel better. And to be honest, the MBAs do have a lot of it coming to themselves, not all of it, but a lot.

sethammons 13y ago

I'm not informed on customer demographic differences between Costco and Walmart, but I'd think that a poor economy will disproportionately affect Walmart due to economically disadvantaged people won't be shopping at Costco in the first place and they tend to be the ones hurt the most in economic downturns. So "better" customers could be leading to better financials on the part of Costco, not just some anti MBA culture that resonates with the HN crowd.

fleaflicker 13y ago

The referenced article: http://www.businessweek.com/articles/2013-06-06/costco-ceo-craig-jelinek-leads-the-cheapest-happiest-company-in-the-world http://www.businessweek.com/articles/2013-06-06/costco-ceo-c...

thehme 13y ago

I heard about the good pay and benefits for workers, and thought it would be great to join as a costumer and cancel my other membership. Just waiting for one to open close by to do this and support these sort of business models.

tokenadult 13y ago

I liked the Business Week article that this article link-spammed from even better. http://www.businessweek.com/printer/articles/123492-costco-ceo-craig-jelinek-leads-the-cheapest-happiest-company-in-the-world http://www.businessweek.com/printer/articles/123492-costco-c... "This week, I’m writing about Costco again because of this wonderful article about the company, on the cover of Bloomberg Businessweek. There’s tons of fascinating info packed inside, even stuff that I, who consider myself to be something of a Costco nerd, didn’t know."

sologoub 13y ago

Looks like a lot of people commenting didn't bother to read the article: "Costco does not hire business school graduates—thanks to another idiosyncrasy meant to preserve its distinct company culture. It cultivates employees who work the floor in its warehouses and sponsors them through graduate school." Note that they do not recruit from B-Schools, but they are happy to send their own employees to graduate school. In the past, working your way up from the bottom in a large company, being sent for an MBA or MBA/JD combo was a relatively standard thing. Several of my professors/acquaintances have taken this track in Citi Group (I think they got renamed) and the like. Amgen, Boeing, Raytheon, Intuit, etc. (I live in SoCal.) have similar policies and practices where they encourage employees to get a graduate degree (be it Business or Engineering). This is not very groundbreaking and is well documented to be a solid strategy for employee development.