Case study assignmentbusiness ethicshome depot implements stakeholder orientation

MINISTRY OF EDUCATION AND TRAINING NATIONAL ECONOMICS UNIVERSITY SCHOOL OF ADVANCED EDUCATION PROGRAMS -⁕⁕⁕ CASE STUDY ASSIGNMENT BUSINESS ETHICS Home Depot Implements Stakeholder Orientation Lecturer: Nguyễn Bích Ngọc Full name: Phan Hồ An Ly Class: Kinh doanh Quốc tế CLC 63D Hà Nội, November 2022 Home Depot Implements Stakeholder Orientation I Introduction .3 II MANAGING CUSTOMER RELATIONSHIPS .3 III ENVIRONMENTAL INITIATIVES IV A STRATEGIC COMMITMENT TO SOCIAL RESPONSIBILITY V EMPLOYEE AND SUPPLIER RELATION VI NEW TECHNOLOGY INITIATIVES VII CONCLUSION QUESTION .10 This is a preview Do you want full access? Go Premium and unlock all 12 pages Home Depot Implements Stakeholder Orientation Access to all documents I Introduction In 1979, Bernie Marcus and Arthur Blank revolutionized the hardware and home Get Unlimited Downloads improvement retailing sector when they built the first Home Depot location in Atlanta and they envisioned huge warehouse-style storesgrades stocked with an extensive selection of Improve your products offered at the lowest prices Do-it-yourselfers and building contractors can choose from 40,000 different goods for the house and yard, including carpeting, paint, tools, kitchen and bathroom fittings, lumber, and plant and landscaping supplies Upload Additionally, the business also provides free home improvement clinics to show clients Share your documents to unlock how to take on simple tasks like tiling a bathroom If a product is not available at a store, Home Depot offers 250,000 items that can be ordered on demand Although certain Home Depot locations are open around-the-clock, shoppers can also order goods online Free Trial For those customers who prefer not to “do it yourself,” most stores offer installation services Home Depot currently has over 300,000 employees and runs over 2,250 Get 30 days of free Premium locations across the US, Mexico, Puerto Rico, China, the Virgin Islands, Guam, and Canada It also operates five wholly owned subsidiaries: Apex Supply Company, Georgia Lighting, Maintenance Warehouse, National Blinds and Wallpaper, and US Home Systems With over $ 74 billion in annual revenues, the company Already Premium? Log in is the biggest reseller of home improvement products worldwide II MANAGING CUSTOMER RELATIONSHIPS In 2002 when Costello arrived the reputation of Home Depot was in tatters His strategy included overhauling the Home Depot website and fusing direct and mass marketing with in-store experiences The new philosophy was expressed by the new Home Depot mantra: “You can it We can help.” Teams of people from merchandising, marketing, visual merchandising, and operations attempted to provide the best shopping experience and associates (employees) should be able to offer installation and design advice In 2006 John Costello held the title of chief marketing officer, or "chief customer officer" To make it easier and more successful for consumers to complete their home renovation projects, Costello combined the marketing and merchandising activities In 2008, Frank Bifulco took over as new chief marketing officer and senior vice president It was a tough time for Home Depot Because of the Great Recession, consumers were spending less on their homes Home Depot’s new marketing strategy was to emphasize the store’s everyday low prices, high product value, and quality energysaving products At the same time, the company cut back on special offers like discounts and promotions Despite Home Depot’s proactive approach to customer issues, the company has dealt with negative publicity related to poor customer satisfaction in the past Some former managers at Home Depot have blamed the company’s service issues on a culture that operated under principles reminiscent of the military Under CEO Robert Nardelli, some employees feared being terminated unless they followed directions to a tee Harris Interactive’s Reputation Quotient Survey has ranked Home Depot for the past three years, and the company has proven inconsistent with its standing At one time a number of customers said they appreciated Home Depot’s quality services However, shortly after months of decline in customer satisfaction and other areas, Nardelli was fired and Frank Blake became the newly appointed CEO Home Depot was ranked 24th on the list in 2011 The following year, it increased to 14, but in 2013, it dropped to 17 Home Depot typically behind rival Lowe's in the annual American Customer Satisfaction Index published by the University of Michigan in 2013, according to the study The company's performance is down 1% from the prior year, but Lowe's position is unchanged Despite this versatility, Home Depot’s customer-satisfaction ratings are still a major improvement from Home Depot’s 2007 ranking of 27 The company’s Twitter feed was inundated with comments from unsatisfied customers Frank Blake made various activities that contributed to the rise in customer satisfaction Blake quickly admitted, apologized for the inconvenience, and encouraged them to continue to leave their feedback so they could make improvements Every complaint was addressed, some angry followers were appeased by phone calls from store managers and personal emails responding to their specific issues Self-checkout lanes have been built inside the stores so that consumers won't have to wait in line Home Depot was also the first to partner with PayPal During busy times, when consumers are waiting in line, Home Depot employees can scan the items in their baskets and hand them a card that contains all of their purchases When the customer reaches the cashier, they simply scan the card and pay the total they owe Many of the Home Depot associates are given devices called “First Phone'', to help customers quickly by calling or paging fellow associates who can answer customers’ questions and have immediate access to the price of an item by scanning it right where they stand Home Depot provides a free program called the Kids Workshop available at all its stores to teach children how to create objects used around their homes or neighborhoods Home Depot also offers free workshops especially designed for women and for new homeowners III ENVIRONMENTAL INITIATIVES On the twentieth anniversary of Earth Day in 1990, Home Depot launched its environmental program by embracing a set of environmental principles The National Retail Hardware Association and Home Center Institute, which represents more than 46,000 retail hardware stores and home centers, have since adopted these principles The retailer started using office and store supplies, recycled-content signs, advertisements, and shopping bags The following year the firm launched a program to recycle wallboard shipping packaging, which became the industry's first "reverse distribution" program Additionally, it was the first retailer in the world to pair one of its Georgia locations with a drive-through recycling facility A year later, Home Depot became the first home improvement retailer to sell wood products sourced from tropical and temperate forests that have been adjudged to be "well-managed" by the Forest Conservation Program of the Scientific Certification System The company also began to replace its hardwood wooden shipping pallets with reusable “slip sheets” This is a preview Do you want full access? Go Premium and unlock all 12 pages In 1999 Home Depot joined the Certified Forests Products Council However, the business continued to market goods made of wood from old-growth forests In an effort Access to all documents to stem the loss of old growth forests, protesters organized by the environmental organization Rainforest Action Network picketed Home Depot and other home center Get Unlimited Downloads stores for years Later that year, during Home Depot’s twentieth anniversary celebration, Arthur Blank announced Home Depot would stop selling products made from wood Improve your grades harvested in environmentally sensitive areas Home Depot said that by 2003 it had increased its purchases of certified sustainable wood products and had decreased by 70% its purchases of Indonesian lauan, a tropical rainforest hardwood used in door Upload components In an effort to reduce its carbon footprint, Home Depot installed dual-flush Share your documents to unlock low-flow toilets in stores that reduce water usage by 40 percent The company then provided new irrigation systems that reduced water usage by 35 percent and only irrigates where and when it is necessary Also, Home Depot installed LED exterior signs that Free Trial replaced the fluorescent lighting that was previously in place Additionally, Home Depot replaced the outdated fluorescent lighting with LED external signs To further its efforts Get 30 days of free Premium of sustainability, Home Depot installed solar panels on 62 of its retail stores, making it the largest retailer to host solar programs The business was recognized as one of the top 25 Socially Responsible Dividend Stocks for its efforts in social responsibility and sustainability The company also offers a variety ofLog sustainable products through the Already Premium? in brand Energy Star, which allows their customers to take part in creating a better tomorrow Home Depot’s environmental programs earned the company an A on the Council on Economic Priorities Corporate Report Card, a Vision of America Award from Keep America Beautiful, and a President’s Council for Sustainable Development Award The company has also been recognized by the U.S Environmental Protection Agency with its Energy Star Award for Excellence IV A STRATEGIC COMMITMENT TO SOCIAL RESPONSIBILITY In addition to its environmental initiatives, Home Depot focuses corporate social responsibility efforts on affordable housing and disaster relief The business collaborates with Habitat for Humanity to build houses for those who are less fortunate In 2002 the company initiated the Home Depot Foundation, which provides additional resources to assist nonprofits in the United States and Canada Since its inception, the Foundation invested $300 million in building and renovating affordable, sustainable homes, improving local parks and playgrounds, and repairing community facilities nationwide In addition, the company invested $ 80 million in building homes for veterans Besides, the Home Depot Foundation donated $ 2.7 million in cash and in-kind donations to fund Repair Corps to repair the homes of disabled veterans Not only is the company one of the first organizations on the scene to rebuild communities in times of disaster, Home Depot also donates $500,000 annually to the American Red Cross Annual Tragedy Giving Program (ADGP), which helps the organization to respond promptly in times of need After the / 11 terrorist attacks, the company set up three command centers with more than 200 associates to coordinate relief supplies such as dust masks, gloves, batteries, and tools to victims and rescue workers After the 2010 Haitian earthquake, Home Depot Mexico donated $ 30,000 to Habitat for Humanity Home Depot pledged to double the resources its Mexican associates raised to aid in the relief effort When Hurricane Sandy hit the American East Coast in 2012, Home Depot responded with $ million in donations in gift cards, supplies, and contributions to organizations that provided food, clothing, shelter, and volunteer efforts In 2013 The Home Depot Foundation created a $1 million fund in efforts to provide financial support for the victims in tornadoes in Oklahoma and areas of the Southwest More than 250 Home Depot volunteers joined in to assist with disaster relief efforts Home Depot strives to secure a socially responsible reputation with stakeholders Although it received low scores in the past on customer surveys and the American Customer Satisfaction Index, the company is consistently working hard to bring those scores back up Despite Home Depot’s success, however, the company faces challenges in the future Still, Home Depot’s philanthropic endeavors and its promotion of its products’ low prices and high value continue to make it a popular shopping destination Customers’ concerns over social responsibility and green products have not abated, and Home Depot’s sales of green products are strong Its commitment to social responsibility extends throughout the company, fueled by top-level support from its co-founders and reinforced by a corporate culture that places great value on playing a responsible role within the communities it serves V EMPLOYEE AND SUPPLIER RELATION A class-action lawsuit launched by female employees who claimed they were paid less than male employees, received fewer pay raises, and were promoted less often in 1997 At the time, the $ 87.5 million payment was one of the biggest in a gender discrimination case in American history Since the lawsuit, Home Depot has made an effort to demonstrate its appreciation for workforce diversity and its commitment to provide all employees with an equal opportunity to succeed In 2005 Home Depot formed partnerships with the ASPIRA Association, Inc., the Hispanic Association of Colleges and Universities, and the National Council of La Raza to recruit Hispanic candidates for parttime and full-time positions In the same year, the company became a founding member of The Resource Institute, whose mission is to help small minority- and women-owned businesses Home Depot is a member of the American Association of Retired Persons’ (AARP) Featured Retirement Program that helps connect employees 50 years or older with companies that value their experience Home Depot ranked number 13 for the Top 50 American Organizations for Multicultural Business Opportunities in 2012 and was named the Georgia Minority Supplier Development Council (GMSDC) Buyer of the Year Transportation and Logistics VI NEW TECHNOLOGY INITIATIVES Compared to its rivals, Home Depot lagged behind technologically The same way that they had been using computers for the previous 15 years, Home Depot employees were using them Unlike its rival Lowe’s, Home Depot did not allow consumers to choose to complete their transactions online In 2010 Home Depot’s online sales constituted only 1.5 percent of overall sales Home Depot started a number of technology projects after realizing its limits in this field Home Depot invested $ 64 million to create First Phone, a device that replaces the old computers on associates’ carts Home Depot distributed 30,000 of these devices in over 1,900 of its stores to allow associates to communicate This is a preview Do you want full access? Go Premium and unlock all 12 pages with other associates, print labels, process credit and debit card transactions, and manage inventory, among other functions In 2013 Home Depot rolled out 25,000 new devices Access to all documents called First Phone Junior, a scaled-down version of First Phone Home Depot also redesigned its website and provided upgrades such as live chat and developed a buy Get Unlimited Downloads online pickup option Home Depot managed to cut the amount of time it took to reply to emails from 24 hours to no more than an hour 2011 a special component of the Home Improve yourIngrades Depot website launched for “Pros” (Professional and Contractor Services) which allow professionals and contractors to order online and pick up their goods within a couple of hours, and enable delivery for certain products when ordered in bulk Three percent of the Upload customers identified as Pros make up 30 percent of Home Depot’s annual revenue Share your documents to unlock Additionally, Home Depot is improving its logistics Home Depot created distribution centers to make operations run more smoothly instead of sending merchandise directly to the stores, where associates would then unload them These are just a few of the steps Free Trial Home Depot is taking to adopt a more proactive stance toward technological innovation Home Depot invested $ 1.3 billion in technology over a three-year period Get 30 days of free Premium VII CONCLUSION Over the past 35 years, Home Depot has changed the do-it-yourself home improvement retail environment The company started with a clear understanding of its various stakeholders and has developed a strong commitment to customers, communities, Already Premium? Log in suppliers, employees, and the environment From the beginning Home Depot has had a strong commitment to communities and has always been ready to respond to disasters such as hurricanes, tornadoes, floods and help those who are less fortunate have their own homes Home Depot continues to pursue innovation and change to relate to its stakeholders For instance, it is engaged in a strategic overhaul of its supply chain The company continues to upgrade and strengthen its competitive position and has earned a strong financial rating because of its effectiveness in implementing strategies targeted toward stakeholders Today the company has 2,257 stores in the United States, Mexico, and Canada It remains the world’s largest home-improvement retailer and is poised for substantial future growth Its stock reached an all-time high in 2013, increasing 30 percent in value in the first six months of 2013 m Home Depot is a good example of a company that has developed strong relationships with stakeholders and has tried to create an ethical corporate culture The company recognizes that success is not limited to focusing on only one stakeholder, but that it must take a holistic approach to understand how other stakeholders, including suppliers and employees, can help the firm build trust with communities QUESTION On the basis of Home Depot’s response to environmental issues, describe the attributes of this stakeholder Assess the company’s strategy and performance with environmental and employee stakeholders Using the Reactive Defensive-Accommodative-Proactive Scale, the company can be assessed for their strategy and performance with environmental and employee stakeholders To further promote their environmental activism, they have made numerous charitable donations, instituted a carpooling a program and created The Home Depot foundation to support non-profit housing initiatives While the environmental activists could comprise many of the stakeholders, the primary stakeholder they represent is the customers In 1990’s, the people in the community began to push for more eco-friendly practices The attributes of the stakeholder can be considered in their power,in their legitimacy & urgency They possess power as they refuse to shop at a firm that isn’t environmentally responsible, so this compels Home Depot to be endorsed by the Forest Stewardship Council & pushes them to be ‘honest’ as far as their environmental practices are concerned The stakeholders possess legitimacy as they want to ensure that its appearance of being environmentally friendly isn’t a sham, so they push them to get endorsed & ensure they rank high on environmental responsibility lists Besides, The power of these stakeholders is evident in how the company has reacted to the protests by ceasing to sell wood harvested from sensitive areas As a publicly traded corporation, how can Home Depot justify budgeting so much money for philanthropy? What areas other than the environment, disaster 10 relief, and affordable housing might be appropriate for strategic philanthropy by Home Depot? Home Depot can budget such a large amount of money toward philanthropy for the same reason they can spend so much on advertising While many customers may be urged to visit Home Depot due to the latest commercial, circular or sale, many customers are becoming more socially aware and prefer to spend their money at businesses that share their beliefs Consumers feel good about a firm that commits to social responsibility, it is a strategic element that raises revenue, thus, philanthropic acts done by a firm contribute to its overall charisma & appeal to consumers, thus, raising its sales revenue Another area that Home Depot could make a big difference is in education While they have done a lot of work with low-income families, more can be done within traditional public schools Aside from just building playgrounds, Home Depot could expand their in-store clinics and make them mobile, sending them to the different schools in the area They could teach the children to plant a garden, build projects and perform common household repairs Not only would this benefit the communities, it would also create customers for life How is Home Depot working toward reducing its weaknesses to increase its stakeholder orientation? Home Depot strictly follow “Customer first” spirit to service and try to the best in doit-yourself home improvement retail Major divided point to analyze: - Developed strong relationships with stakeholders - Recover quickly and respond to ethical issues - Strong sustainability strategy - Innovation - Tried to create an ethical corporate culture 11 This is a preview Do you want full access? Go Premium and unlock all 12 pages Access to all documents Get Unlimited Downloads Improve your grades Upload Share your documents to unlock Free Trial Get 30 days of free Premium Already Premium? Log in 12