The retail giant Costco Wholesale has dramatically changed the traditional way retail operations are operated. Costco's transformative business style has led other competitors to reevaluate their long-standing and somewhat outdated ways of doing business. This has also significantly impactedthe behavior of the buyers of their products and services. Costco has undoubtedly been a disruptive force in retailing and has set the stage for other businesses to copy itssuccessful formula. In addition to creating an innovative business model, Costco successfully marketed its brand by translating its vision into a practical reality. They also have leveraged technology in their business processes to streamline operations and gain a competitive advantage.

Please research and answer the following questions to generate a thoughtful discussion:

? Explain why it is essential for Costco's corporate accounting, marketing, and operations management business units to access and analyze information about individual store sales. Explain how systems thinking supports business operations and how MIS solves the issue with information silos throughout Costco's worldwide organization.

Only members of Costco can purchase products at Costco. Which of Porter's Five Forces did Costco address through the introduction of its members-only program?

? How is Costco addressing the other Porter forces?

Which of the three generic strategies is Costco following? What is their rationale for pursuing this strategy??

Explain why competitive advantage can only be temporary

Economies of scale Differentiation Capital requirements .. Switching costs Industry Analysis . Access to distribution Cost disadvantages a la Michael Porter beyond those of scale These factors tend . Government policy to raise barriers to market entry by (Barriers) new entrants Entrants (Bargaining Power) (Bargaining Power) Industry Suppliers Competitors Buyers (Rivalry) . Dominated by a few Concentrated suppliers . Buy in volume Suppliers are more . Big ticket items concentrated than the . Standardized or buyers undifferentiated products . No substitutes Substitutes . Low switching costs . Supplier has more Low profit margins important customers Threat of backward . Supplier's input is critical (Function) integration . Differentiated product . Purchase is not very . High switching costs important to buyer . Threat of forward . Numerous rivals . Buy has all the relevant integration Equally balanced information Slow growth . . . High fixed costs Low differentiation . Low switching costs . Large capacity increments These factors Diverse competitors These factors tend to increase High stakes tend to increase supplier High exit barriers customer bargaining power bargaining power These factors tend to increase rivalry among existing competitors