The Home Depot, Inc. Harvard Case Solution & Analysis

Home Depot popularized the notion of "do-it-yourself" for customers keen to construct, repair, and enhance their own houses. Home Depot stores were stocked with a broad range of home-improvement goods and had educated employees ready to help customers pick the right products, tools, and materials and even explain the way to use them. To some degree, Home Depot store manager "did it themselves" as well. For its initial 20 years, Home Depot was run quite informally and was known for its entrepreneurial spirit. Store managers, who tended to be specialists in home improvement, made their own products-planning decisions and had considerable autonomy in running their stores.

The Home Depot, Inc. case study solution

Buying was decentralized. Many in the corporation alleged that a more restricted approach to operation would be important for further increase, as it grew in size. In 2000, the firm hired Bob Nardelli, a former GE senior executive, to lead the change. As chairman and CEO, Nardelli centralized merchandising and buying and brought procedure discipline to shop businesses, simplifying and standardizing store processes and introducing Six Sigma quality methodology. However, Home Depot's stock price remained practically unchanged during his tenure and particular aspects of customer service suffered significantly. These results raise an important question not only for Home Depot, but also for other companies in which employees perform both routine generation-related activities and nonroutine customer-service tasks: Is there a trade off between procedure discipline and customer service? If so, what aspects of customer service?

PUBLICATION DATE: March 12, 2008 PRODUCT #: 608093-HCB-ENG

This is just an excerpt. This case is about ORGANIZATIONAL DEVELOPMENT

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