Home Depot popularized the concept of “do-it-yourself” for customers eager to build, repair, improve, and your own four walls. Home Depot stores were stocked with a wide range of home improvement goods and had competent staff ready to tell customers the right products, tools and materials and how to use them. To a certain extent, Home Depot store manager “has itself” as well. For its first 20 years, Home Depot has been known for its entrepreneurial spirit and was run rather … Read more »

Home Depot popularized the concept of “do-it-yourself” for customers eager to build, repair, improve, and your own four walls. Home Depot stores were stocked with a wide range of home improvement goods and had competent staff ready to tell customers the right products, tools and materials and how to use them. To a certain extent, Home Depot store manager “has itself” as well. For its first 20 years, Home Depot has been known for its entrepreneurial spirit and was run rather informally. Store Manager, the experts tended to be in home improvement, made their own merchandise planning decisions and had considerable autonomy in running their businesses. Shopping was also decentralized. As it grew in size, many believed in society, that a disciplined operations would be important for further growth. In 2000, the company Bob Nardelli, a former GE senior executive asked to lead the change. As Chairman and CEO, Nardelli centralized merchandising and purchasing process and brought discipline to store operations, simplification and standardization memory processes and the introduction of Six Sigma quality methodology. Nardelli, the changes led to higher profitability. Still, Home Depot’s stock remained almost unchanged during his tenure and suffered certain aspects of customer service significantly. These results raise an important question not only for Home Depot, but also for other companies in which the employee is both routine production-related activities and routine customer service activities: Is there a trade-off between process discipline and customer service? If so, what aspects of customer service?
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from
Zeynep Ton,
Catherine Ross
Source: HBS
28 pages.
Release Date: 12 March 2008. Prod #: 608093-PDF-ENG
The Home Depot, Inc. HBR case solution