The Home Depot Strategy
The Home Depot’s vision statement is “To create a company that would keep alive the values that were important to us. Values like respect among all people, excellent customer service and giving back to the community.” While referencing table 2.1 from Thompson, I think Home Depot (HD) followed 4 of the 7 ‘Dos” and unfortunately followed 3 of the 7 “donts”. The vision statement is short, and straight to the point and while it displays an image of caring about the company’s image and culture, it is a little vague in my opinion. There is a foresight of the future in their sentence structure however, it does not go into enough detail of the specific path that will spark interest from its customers and stakeholders.
The following are some strategic and financial objectives that Home Depot could choose:
1. Increase annual dividends and shareholder buybacks by 5%. Financial objective.
2. Increasing the shareholder value by 10% by the end of the FY. Financial objective
3. Create a fully integrated and interactive customer experience. Strategic objective
4. Becoming the sole leader and provider of home hardware goods over its competitors. Strategic Objective.
Company vision statement: “To create a company that would keep alive the values that were important to us. Values like respect among all people, excellent customer service and giving back to the community”
The vision statement shows importance on the culture they are trying to reach while also explaining why they have their target set on that. Overall, good vision statement but leaves room for growth.
Company Mission Statement: “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.”
The mission statement is a great example of a well thought out mission statement. It details what their purpose is and what they would like to offer to their customers that is different from their competitors.
Home Depot and its management has committed itself to excellence in regards to staffing, resource allocation, policies and procedures, information and operating systems, continuous improvement, rewards and incentives, corporate culture, and internal leadership. They are committed to personal safety, wellness, growth, along with gaining consistent profits, and being recognized as the industry leader. They work closely with the American Red Cross and FEMA during National Emergencies to give back to the communities of their loyal customers during their times of needs after natural disasters.
The Core Values of Home Depot:
- Creating shareholder value
- Entrepreneurial spirit
- Taking care of their people (employees)
- Respect for all people
- Doing the right thing
- Building strong relationships
- Giving back
- Excellent customer service
They are all realistic and reachable. Home Depot continues to live up to its core values each and every day by enforcing company policies and working with each store’s community and each customer. They continue to increase shareholder value and rewarding its customer base when the economy and profit margins increase. By working with organizations such as FEMA, American Red Cross, and Habitat for Humanity and Veterans Outreach, they continue to live by their core values and give back to the community that provides so much to them.
In the industry of hardware store, HD’s biggest competitor is Lowes. Besides a color scheme and prices, there is not much of a difference between hardware stores. However, HD makes a difference by providing a higher quality of customer service along with more stores and better locations to choose from. HD also provides a better selection for DIYers and small construction firms by the creation of the Pro Desk and tool rental. The Pro Desk is a separate section of the store that allows larger orders to be pulled and also larger discounts for higher order totals. The tool rental allows the one stop shop for DIYers and smaller firms that can not purchase or own their own equipment. I personally think, these two things offer a huge advantage and sets HD apart from Lowes.
Another aspect that leads HD strategy to a sustainable competitive advantage over Lowes is HD’s “Pro Refferral” program. This allows customer interaction within the community and lets the customers refer projects to local contractors that have done good work for them. Another strategy that creates an advantage is the interactive smartphone app that outlines what a particular store has in stock along with where to find it in the store.
References
Desmidt, S. (2016). The Relevance of Mission Statements: Analyzing the antecedents of perceived message quality and its relationship to employee mission engagement. Public Management Review, 18(6), 894–917. http://www.freemanagementresources.com
Greyser, S. A., & Urde, M. (2019). What Does Your Corporate Brand Stand For? Harvard Business Review, 97(1), 80–88. Retrieved from http://www.freemanagementresources.com
The Home Depot (2018). Our Company.
The Home Depot (2018). Our History.
The Home Depot (2018). Stores, Products, and Services.
Thompson, A. (2018) Crafting & Executing Strategy: The Quest for Competitive Advantage: Concepts and Cases. Retrieved from: http://www.freemanagementresources.com
