In some cases it's hard to separate certain chief executives from their companies. You don't think about Whole Foods without John Mackey coming to mind. The same is true with Costco where Jim Sinegal is synonymous with a mention of the retailer's name.
Eventually, however, the seemingly bigger-than-life CEO moves on and gets replaced. At Costco, there has been some concern in recent years as to who might be named to take Mr. Sinegal's place once he chooses to step aside. (He is 74).
This week's promotion of Craig Jelinek from vice president in charge of merchandising to president and chief operating officer has many thinking that he is the heir apparent.
David Strasser, retail analyst at Janney Capital Markets, told The Seattle Times that investors should be more comfortable now "about a management transition when Jim Sinegal decides to step down."
Not everyone will be happy, however, as some were hoping that Mr. Sinegal's eventual replacement would be more concerned with raising margins and reducing costs, perhaps by reducing labor costs. The Costco culture of paying its employees above market rates, offering generous benefits packages and not going the union-bashing route has led to criticism of Mr. Sinegal's management in the past.
While talk of succession is in the air, Mr. Sinegal has not indicated that he's looking to retire and find something new to do.
"Being very, very agile with the numbers is a very important element of the business, and being able to go out and travel and visit the warehouses and make sure you go to every opening," he told the Times. "I'm healthy and enjoying things and still working hard and reasonably adept at what I'm doing."
Discussion Questions: Should Costco make its succession plans public? Do you see Craig Jelinek as a good choice to replace Jim Sinegal when he eventually steps down from Costco? What qualities would you like to see in the next leader?