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Home depot organization structure
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In the beginning Home Depot coined the phrase do it yourself and they cornered home improvement market in the United States. Home Depot was founded by Bernie Marcus and Arthur Blank, Home Depot was able to offer extraordinary customer service by hiring professional employees, such as plumbers, carpenters, electricians, etc., who would guide prospective customers through home renovation projects. Since its opening in 1978, Home Depot has become one of the largest home improvement retail chain in North America and they have also open stores internationally. In 2005 Home Depot started experiencing a deteriorating shift in business, accompanied with a critical change in management style, this effective the morale of the employee and made …show more content…
investors very unhappy. At this time Frank Blake leadership style and behavior was being criticized and the Board of Director. The Board of Director replaced Robert Nardelli the former CEO of GE Power Systems in December of 2000. Despite the fact that Nardelli no retail experience he was using the "Six Sigma" management strategies that he used at GE, he vividly renovated the company and replaced its freewheeling business process. Nardelli transformed the decentralized management structure of Home Depot, by the elimination and consolidation of division executives. He developed new methods and reorganized operations, which implemented an automated computerized inventory system and consolidating supply orders at the Atlanta headquarters. In my research, Nardelli started making the company look and feel like an army.
He loved to hire individual with a military background, he believed that they would be discipline and would be dedicated to the successfulness of Home Depot. Applying military concepts was a key factor in Nardelli's plan to restructure Home Depot and make it a more centralized business. This was a good business strategy or so he thought. Home Depot did become centralized and the good financial reports did follow. Revenue increased from $45.7 billion in 2000 to $81.5 billion in 2005, while profits rose from $2.6 billion to $5.8 billion. But, this was the slowest growth rate that Home Depot had experienced in the past, it was because past growth was due to the company's rapid speed of expansion. Nardelli started being criticized by board members for not maintaining the rapid growth the company has experienced in the past, but Nardelli never striated away from his strategy. He was known for running a company with a command-and-control type of structure. Functional structure is how Nardelli made all main decisions and he micro managed all activities and treated the staff as an extension of management. The company was not ran like this in the past, and some of the board members became nervous. His ambition also drove him to expand the service component of the organization. This was not familiar strategy for the new areas within Home …show more content…
Depot. In my research, Dr. Anne Reilly a professor of management at Loyola University, Chicago stated that, “one positive side of hiring an external CEO may strengthen a company, by redirecting it to new markets and industries," (Reilly, 2015) "But on the negative side, a chief executive from outside the company may be unable or unwilling to adapt his or her own personal style to match the corporate culture.” (Reilly, 2015) Nardelli was not capable to link the gap between Home Depot's freewheeling, entrepreneurial culture and the more structured culture at GE." (Reilly, 2015) The first errors Nardelli made was isolating the Home Depot employees. In his pursuit to cut costs, he move toward the selling, general and administrative budget line with a powerful hand. Nardelli decreased labor expenses at stores based on mechanical formulas no regard to how it would impact the customer service level they would receive. Nardelli fired some full-time skilled employees and reduced the hours of the remaining full time employees, the he increased the hours of the less skilled part-time workers. Nardelli failed to recognize, the critical element to sales for the company is the do-it-yourself retail principle of Home Depot. In my research, some of the reviews that I read, customers stated that "You can go into Wal-Mart and buy laundry detergent, you don't really need anyone to sell it to you. But when you go into a Home Depot, you need someone to be able to tell you what you need, and sometimes you need them to tell you how to accomplish a home improvement project.” (I hate Home Depot. Com) Nardelli also isolated employees, but he also formed a void between Home Depot products and their customers. When Home Depot CEO Robert Nardelli resigned they named Frank Blake as his successor.
Currently, Home Depot maintains a functional structure similar to the one implemented by Nardelli. Nevertheless, Blake did make several changes within Home Depot. First, he hired new top managers and discontinued top management from receiving catered meals daily, instead he started sending them to cafeteria to buy their own lunch, so that they could socialize with all levels of employee and this was a major savings for the company. After hiring new top management team, he then hired many new employees and trained them to provide the best service to customers, with this implementation he hoped that this would return some loyal customer back to Home
Depot. In conclusion, today, The Home Depot is the world's largest home improvement specialty retailer, with more than 2,200 retail stores in the United States (including Puerto Rico and the U.S. Virgin Islands), Canada, and Mexico. The Home Depot’s stock is traded on the New York Stock Exchange (NYSE: HD) and is included in the Dow Jones industrial average and Standard & Poor's 500 index. (www.homedepot.com) Home Depot fosters the values that guide the beliefs and actions of all associates on a daily basis. Home Deports values are the fabric of the Company’s unique culture and are central to our success. (www.homedepot.com) In fact, the associates and customers are the competitive advantage for Home Depot remaining in the marketplace. Associate pride and their “orangeblooded” entrepreneurial spirit are characteristic trademarks of the Home Depot culture. .
Established as the older company of the two, Lowe’s ranks forty-second as a Fortune 500 company. Established in 1946 as a small hardware business, Lowe’s has grown into a 40,000 product, global market enterprise that consist of 1,710 stores nationwide expanding into the countries of Canada, Mexico and Australia (Lowe's Internal, 2010) Home Depot, founded in 1978, is the fastest growing retailer in the United States. Ranked twenty-ninth as a Fortune 500 company, Home Depot continues to remain the number one do-it-yourself retail store in America. These two companies may sell products of the same nature, but comparing their Code of Ethics is their way of setting themselves apart. (Home Depot Internal, 2009)
Home Depot is the brainchild of Bernard Marcus and Arthur Blank and came about after both men lost their job in the home improvement industry in 1978 (Parnell, 2014). Home Depot has acquired several smaller home improvement stores in both the U.S. and abroad through the years which enabled it to position itself as the world’s largest home improvement chain (Parnell, 2014). Home Depot focuses on the do-it-yourself segment of the market and sells sells tools, construction products and services. Marketing is a strong point for the company. They are able to maintain a competitive advantage by keeping themselves available to their customers at all times. Home Depot has been using both online and offline marketing efforts. The internet has become a very useful tool for the company and part of the reason that they are leading the market in DIY stores. Home Depot currently provides DIY videos on YouTube and Vine that cover current topics that consumers are likely to be interested in. They also have social media pages on Facebook and Twitter, where they have a huge following. They provide online communities where actual employees answer consumer’s questions and provide assistance on
Opening its doors for the first time in 1946, Lowe’s is now the second largest home improvement chain in the world, operating over 1,800 stores in the United States, generating $56.2 billion in sales and $2.6 billion in net income for 2014 (Lowes Newsroom, 2015). Employing around 265,000 personal making them one of the top employers in the nation, there is no question that Lowe’s must be doing something right. According to Lowes Newsroom, “Lowe’s professional customers represent approximately 30 percent of total sales, approximately 16 million retail and professional customers are served each week. (2015, para 3) “Never Stop Improving”, is Lowe’s slogan; encouraging employees and customers to work together to maximize their in store
Internally the strategy moving forward was unclear. The chance to address 25,000 dealers demanded the new leadership had a clear picture of their mission moving forward. With a very narrow scope of product offerings and the slowing sales of their high-end speakers, the decision to expand into additional products, or stay focused on their main revenue source would determine the future of the company. Offering their product in the large retailer market and pulling away from the independent installers had already damaged their brand equity. Furthermore, engaging with the production home builders, while generating the necessary revenues for survival, alienated the custom installer and their referral clients. (Kerin & Peterson, 2013). Considering the relatively small size of the company combined with the dangers associated with brand extension could overstress the resources necessary to launch and maintain a new line. One of the keys to a successful concentric diversification is close coordination with existing customers and distributors. Unfortunately, the dealers that had made them successful were not pleased with their recent brand dilution. (Gordon,
In the early 2000’s Lowe’s was rapidly intensifying its presence nationwide. The company carried a varied assortment of home improvement products and catered to the needs of retail as well as commercial business customers. Lowe’s expanded their reach by acquiring a 41-store chain, Eagle Hardware and Garden, and engaging in a strategic alliance with HGTV to obtain a more profound existence in their market (Rouse, 2005). By 2004, Lowe’s operated almost 1,000 stores with plans to continue expansion across the nation (Rouse, 2005). The company has a core competency in helping customers meet their home improvement needs at a low price. In order to use this core competency to gain a competitive advantage, the company has focused on key functional strategies. To continue their success, Lowe’s must specifically focus on marketing, logistics, and human resource management strategies.
Tanglewood was founded in 1975 by a pair of best friends. Today they have expanded well beyond their dreams and own 243 store fronts while offering online business as well. With expansion in brick and mortar and online business, Tanglewood needs to stay on top of their operations and strategic decisions for staffing levels to maintain quality and keeping their customer service top notch. Their current deficiencies within the company such as a weak Human Resource department and staffing environments being pretty much individually driven, Tanglewood must make some slight adjustments strategically to keep operational changes to a minimum, unless needed versus changing them each time a department or employee voices a suggestion. (pg 6-7, Tanglewood
The Home Depot learned the hard way that you must hire a leader that will stay true to the core values. The leader’s ethics and values will play a huge role in determining if the company will succeed or fail. The founders of The Home Depot built a culture on the foundation of respect, integrity, and compassion. The culture and customer service under the influence of the admired founders prospered.
Home Depot was started in 1978 as a one-stop shopping for do-it-yourselfers. As the fastest growing retailer in U.S. History, Home Depot went public on NASDAQ in 1981, and moved to the New York Stock Exchange in 1984. By 1989, Home Depot had opened its 100th store. In 1994, Home Depot moved into Canada with the acquisition of Aikenhead’s, in 2001, they moved into Mexico with the acquisition of Total Home. Home Depot acquired The Home Way in China in 2006.
Nardelli became CEO of Home Depot in December 2000 despite having no retail experience. Using the "Six Sigma" management strategy from GE, he dramatically overhauled the company and replaced its freewheeling business process. He changed the decentralized management structure, by eliminating and consolidating division executives. He also installed processes and streamlined operations, which implemented a computerized automated inventory system and centralizing supply orders at the Atlanta headquarters.
Target Corporation's strategic structure plans are continuing staffing the organization and assemble a well-talented management team. Also, continue recruiting and retaining employees with the needed experience. Another option is to acquire, develop and strengthen resources and capabilities in performing critical value chain activities to match changing market conditions and customer expectations. Target Corporation needs to explore multidivisional or matrix organization structure to facilitate strategy execution, delegate authority, and managing external relationships (Thompson, Peteraf, Gamble and Strickland, 2016).
|Business |The Home Depot, Inc. is the world's largest home improvement retailer. The company incorporated in 1978 in |
Once Home Depot’s marketing plan contains a thorough description of the scissor lift, it will then focus on the branding, pricing, and distribution of the lift. The plan will also need to include a product branding and pricing strategy, as well as examine how the pricing strategy supports the branding strategy. In addition, Home Depot will prepare a distribution channel analysis from which it will create a distribution strategy, determine whether the company is going to use a push or a pull strategy, and how the distribution strategy fits the product.
Organizational culture is a reflective view of the inner workings of an organization. This culture reflects hierarchical arrangements as it pertains to the lines of authority, rights and obligations, duties, and communication processes. Organizational structure establishes the manner in which power and roles are coordinated and controlled amongst the varying levels of management. The structure of an organization is dependent upon their goals, objectives, and strategy. Determining organizational structure best suited for an organization is generally found within the six key elements of organizational structure and choosing those to implement those best suited for the organization. The six key elements include:
One of the nation’s largest family-owned and family-managed building-supply companies is McCoy’s Building Supply (Uhl-Bien pg. W121). They have been a continuous successful operation over the last seventy years. McCoy’s main goal is to acquire and sell the finest-quality products that can be found and providing phenomenal service to all customers. Keeping this goal a priority McCoy’s has served ten million customers a year in regional areas. As an operations-oriented business McCoy’s management style is different from other companies, which is another factor of their success.
Even with all of things I’ve for mentioned, there’s so much more that goes into keeping a hardware store in business and stay afloat the 11 hours a day they are open, seven days a week, for 360 days a year. I could probably write an entire book about different things that you need to keep up with at the store, like stocking/ordering information, point of sale system, deliveries, floor cleaning, correctly counting out the cash registers…the list goes on and on. It’s a never ending cycle when it all comes down to it, but you need to stay on the ball with it. The second you fall behind in the hardware business (for any small business for that matter.), is when you’re most vulnerable to the decline of your business.