...Background The Home Depot was founded in 1978 by Bernie Marcus and Arthur Blank in Atlanta, Georgia after they were fired from their executive post at the Handy Dan Home Improvement Centers in California. The founders began the home improvement company around their vision of “one-stop shopping for the do it yourselfer” opening their first two stores in 1979 in Atlanta, Georgia in a cavernous warehouses that dwarfed the competition stocking 25,000 stock keeping units (SKUs), much more than the average hardware store at that time, and staffing the stores with knowledgeable experts in home improvement and customer service. From the beginning, Home Depot was able to offer not only the best customer service in the industry by hiring employees knowledgeable and experienced in the business and by motivating the sales associates to develop relationships with the customers instead of seeing sales as a transaction, but by popularizing the concept of “do it yourself” (DIY) offering to homeowners and other individuals trainings workshops and clinics so customers could learn how to do it themselves. The Home Depot revolutionized the home improvement industry by bringing the know-how and the tools to the consumer and by saving them money. In 1980, Home Depot opened two more stores achieving annual sales of $22 million from all its four stores. By 1990, the company had opened 145 stores, employing 21,500 people, generating annual sales of $3.8 billion, and becoming the number one U.S. retailer...
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...Leadership Case Study Jenee Tugwell Shawna Wentlandt, PhD Behavior in Organizations September 12, 2013 Abstract A leader shares their vision with their employees and convinces them that their vision must come to reality. In other words, a leader sells their dream to the employees and convinces them to accomplish it. The ability of the leader to influence others is the key to the success of every organization. Every member, of the organization, should have the same vision of the leader and be compelled to make the vision reality. The leader should make everyone feel like they are an integral part of the organization and are empowered to achieve excellence. This paper discusses Steve Jobs and Robert Nardelli’s leadership styles and their impact on their organizations and if they would be considered as ethical leaders. Leadership Steve Jobs was an unconventional leader. He demanded excellence from his staff and was known for his blunt delivery of criticism. But it was his sheer genius combined with his ability to articulate his vision and bring staff, investors and customers along on the journey. Steve jobs was a charismatic leader. He had the ability to influence people without logic. He built, arguably, the most creative company in the world. He was also exceptionally good at selecting talent within employees to work for him. Steve Jobs’s leadership style was complex. He was intensely focused when committed, confident enough to take risky leaps, and charismatic...
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...things to consider. Some leaders have a very difficult time grasping the importance of ethics within their organization, while other even though they try to be ethical, still have some flaws. Even though things went ugly for Robert Nardelli I believe he stood his ground and made an example of what it is to be a business person on top of the game. Trait Theory Robert Nardelli’s leadership style and whether or not his actions rose to the level of being unethical will be discussed. While ethics of an organization play an extremely important role within a leader’s actions, the theories that make up that same leader tell a further story into the aspects of their leadership style. The Myers-Briggs Type Indicator has been widely used and has helped a lot of people discover new things about themselves and others. This trait theory has been used in organizations all over the world to understand their employees better in an attempt to utilize their specialties and creativity. The trait theory explains the ability that leaders have to be able to leader across various industries with such skill. Robert Nardelli’s leadership style was very interesting. In some ways he was considered a mastermind the way he raised the company’s profits and brought more organizational structure. The problems became when begun when his leadership style stared rubbing shareholders, customers, and employees the wrong way. With his military style leadership, employees were uncomfortable and shareholder’s ...
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...Home Depot A. Executive Summary * Introduction * The Home Depot Story - First Stage (1979-2000) * The Home Depot Story – Second Stage (2000 – 2006) * Problem Identification * Case Questions Introduction * Home Depot was founded in 1978 in Atlanta, Georgia by Bernie Marcus and Arthur Blank. * Both of them worked at Home Improvement Company in California and were fire by this company. * So instead of looking for a new job they decide to start up their own business based on a vision they had. * This vision was about creating home improvement stores similar to warehouses where customers would be able to find different types of tools and products with the help of experts in home improvement and customer service. * Home Depot created the concept “Do it yourself” (DIY) where homeowners were encouraged to buy products and tools and to use them to build, repair and improve their own homes. * This concept of “Do it yourself” was Home Depot’s main strategy to become successful in the Home Improvement industry. The “Do it yourself concept consisted on: * Prioritizing customer service (special attention to their customers problems) * Providing customers with training workshops and clinics to teach them how to repair their own homes. * Vendors and sale associates went through a rigorous training in product use before servicing customers. * Sales associates develop relationships with customers rather than just merely seeing...
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...TAVIS COBURN Deep, lasting culture change requires an integrated approach that remodels a company’s social systems. The leadership team of Home Depot employed a remarkable set of tools to do that. by Ram Charan W hen Robert Nardelli arrived at Home Depot in December 2000, the deck seemed stacked against the new CEO. He had no retailing experience and, in fact, had spent an entire career in industrial, not consumer, businesses. His previous job was running General Electric’s power systems division, whose multimilliondollar generating plants for industry and governments were a far cry from $10 light switches for do-it-yourselfers. re tu ul C Change HOME DEPOT’S BLUEPRINT FOR april 2006 61 H o m e D e p o t’s B l u e p r i n t f o r C u l t u re C h a n g e Nardelli also was taking over what seemed to be a wildly successful company, with a 20-year record of growth that had outpaced even Wal-Mart’s – but with latent financial and operational problems that threatened its continued growth, and even its future, if they weren’t quickly addressed. To top it off, Nardelli’s exacting and tough-minded approach, which he learned at General Electric, set him on a collision course with the freewheeling yet famously close-knit culture fostered by his predecessors, Home Depot’s legendary cofounders, Bernie Marcus and Arthur Blank. It was this culture that Nardelli had to reshape if he hoped to bring some big-company muscle to the cooled from the breakneck pace of the...
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...Home Depot and PepsiCo Founded in 1978 by Bernard Marcus and Arthur Blank, The Home Depot is an American home improvement and construction product retailer. It operates stores in all fifty states, the District of Columbia, Puerto Rico, the Virgin Islands, Guam, Canada and Mexico. It is the largest home improvement retailer in the United States, next to Lowes. Founded in 1965, PepsiCo is an American food and beverage corporation formed between the merger of Pepsi-Cola and Frito Lay. PepsiCo has gone on to expand to include Tropicana, Quaker Oats, Gatorade and many more. Each generating sales of one billion dollars each and distributed in more than 200 countries (PepsiCo). As of 2011, PepsiCo employs approximately 297,000 people worldwide (PepsiCo). This paper will assess the above mentioned companies areas of leadership, management, organizational learning (training), and culture and compare and contrast to the structure The United States Army and Macy’s Department Store. Home Depot Leadership: In 2000 Marcus and Blank were replaced with Robert Nardelli, who pushed hard to make the company more efficient, bringing with him many new metrics to centralize operations, and to meet quarterly goals he even cut jobs of associates. Nardelli, a former General Electric top executive, arrived at Home Depot with a leadership style that was already outdated, an autocratic top –down style of command and control. Under Nardelli, Home Depot went from a retail business to a new contracting...
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...life as examples for people to live better. In this paper, I will explore the leadership style and methods of Robert Nardelli who was named Chief Executive Office of the Home Depot in 2001 (Ries, 2009). Robert Nardelli Leadership Style Home Depot Robert Nardelli presented many latest initiatives to the corporate world such as company-wide analytics, centralized buying and better information systems, these are important for the company to remain competitive. Anyhow, most of his changes results in reduced productivity, significant dissatisfaction, low morale, and high turnover. This result was considered as the most dissatisfaction of customers in retailing history (Brabec, 2006). On the American customer satisfaction index (ACSI), home depot had customer satisfaction scores of 74 in the year 2001. In 2005 anyhow, customer satisfaction score of home depot fell to 67, which was the worst performance on ACSI that year. This instant decline in customer satisfaction led to important deterioration in fiscal performance for the company. In 2006, earnings for the company reduced by 28% and comparable store sales declined by 6.6 percent. This shows the financial decline for the first time in the history of the home depot. At end of the year, Frank Blake appointed as the Chief executive office of the Home depot....
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...CHAPTER CLOSING CASE FROM CHAPTER ONE: PLAYING HARDBALL AT HOME DEPOT BRIEF SUMMARY: This case was mainly about Home Depot’s turning point on its sales increases after the new CEO Robert Nardelli had taken charge of the corporation. The way which Nardelli applied to change the old fashion of running the business was highlighted in the text. Described as command-and-control, the method he used which can be traced back to 1950s was simple and straight and it can be characterized as emphasis on a military-like discipline and obedience. Being centralized again, Home Depot became a more standardized-machine like place where effectiveness and efficiency were laid utmost stress on. Then, Nardelli’s principles are illustrated as follows: First, centralize control over functions. Second, follow slow growth. Third, control by measuring every input and output instead of relying on instinct. Fourth, ruthlessly eliminate underperforming managers. Besides cost cutting, he also made radical progress on wholesale supply to contractors, service offerings and potential new hirings. However, “soft” topics such as corporate culture and employee empowerment are largely neglected, which diminished the better development of this management skill. CASE QUESTIONS: 1. The four principles Nardelli has adopted to improve the performance of the business can be served as examples of his planning phase. When he conducted his plan into practise by assigning tasks for his employees, as in transmitting...
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...we describe the participative leadership style, the autocratic leadership style, the Leadership Grid,™ the entrepreneurial leadership style, gender differences in leadership style, and choosing the best style. Chapter 5 continues the exploration of leadership styles by presenting several contingency leadership theories. Participative leaders share decision making with group members. Participative leadership encompasses so many behaviors that it can be divided into three subtypes: consultative, consensus, and democratic. The participative style encompasses the teamwork approach. Predominant behaviors of participative leaders include coaching team members, negotiating their demands, and collaborating with others. Often the team member who has the most relevant knowledge for the task at hand slips into a leadership role. Research indicates that poor-performing teams are often dominated by the team leader, whereas high-performing teams are characterized by shared leadership.33 The participative style is well suited to managing competent people who are eager to assume responsibility. Such people want to get involved in making decisions and giving feedback to management. Since...
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...Finba1. i. Home Depot’s mission statement is as follows: “The Home Depot is in the home improvement business and our goal is to provide the highest level of service, the broadest selection of products and the most competitive prices. We are a values-driven company and our eight core values include the following: Excellent customer service, Taking care of our people, Giving back, Doing the "right" thing, Creating shareholder value, Respect for all people, Entrepreneurial spirit, Building strong relationships.” (Home Depot, 2014). According to Exhibit 2.1 in chapter two, Top management of a company provide strategic direction after assessing the external and internal environments. Taking a look at the external environment, some of Opportunities available to Home Depot (Circa 2005) were Restructuring, to make operations more sound and profitable, provision of internet shopping facilities to customers, and expanding the market geographically and locally, as well as targeting new market segments. It should be quite important to note that during the Nardelli era, the slogan Home Depot used was “Improve everything we touch”. Threats included declining home sales and market share, a looming credit crunch, a dip in the level of customer service and product knowledge hitherto offered due to poorly trained staff, and a saturation of the markets in North America. Increasing levels of Environmental Uncertainty as more layers of management are added to achieve a more vertical structure...
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...I think the biggest personal reward of being a manager is that a manager is in a way the face of the company. His or her managing style will ultimately bring the company great success or failure. If I were a manager, I would feel my greatest reward to be the satisfaction of knowing I am leading the company in the right direction. The position of a manager entails: planning, organizing, directing, and controlling. All of which require great attention and the ability to make the best possible choice that will benefit the company. The biggest potential ‘downside’ of being a manager would be making a bad decision that will damage a company. A great example of the downside of being a manager is when Bob Nardelli became CEO of Home Depot in 2000. Nardelli implemented an aggressive plan to institute controls that effectively centralized many merchandise and supply decisions. Nardelli’s changes created greater discipline and more structure throughout the company, but also led to unexpected consequences. Local managers became unhappy with their loss of autonomy and flexibility and thus the morale among store managers and employees drastically declined and turnover occurred. I believe that to be an effective manager, one must have an equal mix of technical, interpersonal and conceptual skills. A balance of the three skills will result in a well-rounded manager capable of managing various types of companies. An overreliance on one skill can reduce a manager’s effectiveness. For example...
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...Home Depot: Research and Development Improvement Recommendations This paper is submitted in partial fulfillment for Business Marketing (EMBA) - March 24, 2013 Table of Contents Executive Summary 3 SWOT Analysis 7 Strategic Alternatives 7 Recommendations 11 Marketing Strategy 11 Marketing Implementation and Control 13 References 14 Executive Summary Where do you go to buy your home improvement supplies? Have you experienced an exceptional home improvement store that meets all your needs and provides exceptional service? If the answer is no, there are several reasons to shop at your nearest Home Depot home improvement store. You can count on the variety of products to choose from while viewing the floor showcase. If you are worried about transportation, we offer truck rentals and service installations so you can sit, enjoy and relax while we do all the work. However, we are going to change the customer experience, our goals and efforts are to change your experience the minute you step into your friendly Home Depot store. You will no longer have to wait for a cashier to answer your question because an expert associate will be available immediately to help guide you and meet your needs during your shopping experience. To help fulfill the new customer service experience, we will enhance our current Mobile App that will provide navigation around the store along with a product information scanner. We hope to improve your families shopping experience by incorporating...
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...came together to start a brand new company, JetBlue Airways. JetBlue decided that its strategy was going to be very similar to Southwest Airlines (low cost airline), but focus more on technology by providing the customer with a better experience and ensure more productivity from the aircraft. The company decided that its home base was going to be JFK, with a potential of 2.5 million passengers living within just 10 miles. JetBlue would start with a fleet of brand new Airbus A320s and have to recruit a whole support organization to run the operation. Key Factors for JetBlue to Be Successful The biggest key for JetBlue to be successful is developing a dominant culture. JetBlue accomplished this by defining their core values of safety, caring, integrity, fun, and passion. These are the ground work for the company because it represents “the bedrock for the development of human resource policy and practices and management style”. These values will influence how the rest of the business will be run as subcultures will eventually be defined by other parts of the organization. This could be from supervisors making day to day decision and HR in hiring decisions. As long as the company is aware of these values and ensures that this is part of the day to day business culture – they are off to a good start. JetBlue also needs to become an innovator and risk taker to carry through on its core competencies of leveraging technology. This will ensure its promise to create a better...
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...Arthur Blank founded the Home Depot in 1978. Along with investment banker Ken Langone and merchandising guru Pat Farrah, the founder’s vision of one-stop shopping for the do-it-yourselfer came to existence when they opened the first two Home Depot stores on June 22, 1979, in Atlanta, Georgia. The first stores, at around 60,000 square feet each, were cavernous warehouses that dwarfed the competition and stocked 25,000 SKUs, much more than the average hardware store at that time. Empty boxes piled high on the shelves gave the illusion of even more product. in only one year they opened a 4th store in Atlanta and the company had annual sales of $22.3 million dollars. In only 10 years on its 10th anniversary Home Depot opened its 100th store in Atlanta. I. Current Situation The Home Depot is the fastest growing retailer in U.S. history. Home Depot is the largest home improvement retailer and the second largest retailer behind Wal-Mart in the United States based on net sales for the 2005 fiscal year. In 1981, the company went public on NASDAQ and moved to the New York Stock Exchange in 1984. The 1980s and 1990s spawned tremendous growth for the company, with 1989 marking the celebration of its 100th store opening. The company arrived in Canada with the acquisition of Aikenhead’s home improvement centers in 1994. In 2003 Home Depot opened its 100th Canadian store. Home Depot began flying its flag proudly in Mexico in 2001 through the acquisition of Total HOME. In 2006, the company extended...
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...Introduction Whether you own your home or rent, chances are that at some point you will find yourself looking for something that will lead you to one of these two retail giants. The home improvement industry has evolved from small regional and locally owned hardware stores to these superstores. The top two in the industry are Home Depot and Lowe’s. Each has their eye on moving into international markets, each has superstores in all 50 states and each has evolved along different paths to reach their current positions. According to Fortune 500 Home Depot, Inc. is ranked at #25 and the second largest retailer in the US after Wal-Mart. Home Depot Inc. has its corporate headquarters in Atlanta Georgia. What began in 1979 as two 60,000-foot stores that resembled warehouses has grown to about 2,200 stores across North America, Puerto Rico, and China. Home Depot Inc. is publicly traded on the New York Stock Exchange as NYSE:HD. At the end of 2008 Home Depot Inc. employed 331,000 people. Home Depot sales recorded and posted in 2009 are $71,288.0 mil. Home Depot Inc. is the number one home improvement retailer with Lowe’s coming in second place with sales posted in 2009 at $48, 230.0 mil.. Founded in 1946 Lowe’s went from a small hardware store to the ninth largest retailer in the US. Lowe’s went public in 1961 and began trading on the New York Stock Exchange as NYSE:LOW in 1979. According to Fortune 500 Lowe’s Companies, Inc. is ranked at #47. Lowe’s Companies, Inc. are headquartered...
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