Corporate Strategy Case Study

Home Depot: Nardelli's Challenge

OR

Abstract:
During the early 2000s, Home Depot chairman and CEO, Robert Nardelli (Nardelli) was under immense pressure as the company's growth rate had dropped below 20%, compared to its historic compound annual growth rate of over 25%. To that effect, he had chalked out an elaborate plan to revive growth in late 2001, which, if properly executed, would make Home Depot a $100 billion company by 2005 from $45.7 billion in revenues in 2000 (this meant a yearly growth rate of about 15%-18%). Following the implementation of the plan, the company grew by 17% in 2001, 9% in 2002 and 11% in 2003.

Pedagogical Objectives:

• To discuss the problems faced by Home Depot chairman, Nardelli
• To discuss Nardelli's plans to boost growth and the efficacy of his plans
• To discuss the pros and cons of having an entrepreneurial style of corporate culture
• To discuss the importance of customer service in creating a competitive edge in a retail format
• To discuss Nardelli's plan to focus on services in addition to selling of hardware and whether this style is similar to that of General Electrics (GE's) and would it succeed in the retail format

Keywords : Home Depot - Robert Nardelli's challenge; Growth strategy; Store formats; Warehousing; Retailing; Customer service; Globalisation; Home improvement retail; Maintenance warehouse; Georgia lighting, Apex Supply; Managing in Troubled Times Case Study; Home Depot learning centres; Human resources; National Blinds and Wallpaper; Competitive strategy; EXPO Design Centre stores; Landscape supply stores