The Home Depot Case

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The Home Depot Case

Do you see the divestiture of HD Supply as a good or bad decision for Home Depot? Why

The establishment of the home depot is a good idea when backed by a team of professionals. In addition, with the availability of potential customers in the region, the home depot can tremendously grow. The idea is important in a situation where there is wide access to capital. In this case, the proprietor funded his business from the New York investment bank. The home depot is perceived to have grown rapidly because of good management and proper strategic analysis. In addition, the home depot has the capability of revising their prices thus making the commodities cheap. Therefore, the operations of the home depot are flexible to economical changes because this is a small-scale enterprise. The decrease in price of commodities by the home depots brings a high demand for the commodity and thus high profits are realized. This is because, in the home depots, the demand and supply mechanisms do not commonly influence the prices in the market. The other important element of the home depot is that, there is no wastage of goods because the demand of goods is high. The home depots also have the high privilege of employing the top professionals who are able to manage the business rightly. The home depot supply has also been preferred because there is one-on-one interaction between the consumer and the trader. Therefore, the consumer needs are dealt with efficiently because consumers are able to respond to any changes in supply.

Discuss the competitive challenges confronting Home Depot.

            When competition affects the whole industry, the specific companies are directly affected in terms of cost of production and distribution. Therefore, the companies are forced to change the cost of their products. This cost change is shifted to the home depots through an increase in prices of commodities. Therefore, companies evade this competition through the action of branding their commodities. This branding cost is subjected to the customer hence leading to low consumer turnout in the home depots. The burden of explaining to the consumer about he changes in cost and branding is left to the home depot. This is very challenging because most of the home depots are not financially stable due to their small-scale operations.

How does its business-level strategy stand up against the rivalry in the industry?

The business level strategy involves product differentiation whereby the company ensures that it has branded it commodities uniquely. In addition, the business should ensure that it has a good relationship with the customers in order to identify the taste and preferences of the consumer. Furthermore, the business should stabilize their prices in order to increase the demand of their commodities.

What recommendations can you make to the top management team to structure the organization to support its business strategy?

The top management should ensure that their strategic plan caters for the consumer needs in a broad way. This is done through ensuring that there are no shortages in the home depots. Sequentially, this implies that the consumer needs will be satisfied continually. Additionally, the management must ensure that the home depot has been supplied with many commodities such that it will be able to cater for multiple needs of the customers. In as much as supply is concerned, the management ought to employ qualified personnel who will ensure that consumer issues are dealt with in a qualified way. In order to ensure that the consumers do not shift to other businesses, the management should conduct a research to identify the consumer taste and preferences upon their home depot. This will enable them to have the ability to meet the needs of the customer.

What leadership issues should be addressed by Home Depot to improve the effectiveness of the company’s business strategy?

Leaders in the home depot should possess higher qualification and retail experience in order for them to be able to tackle business challenges with confidence. Computer skills should be emphasized sequentially to facilitate proper record keeping in the business. The leadership skills should be related to the services that are offered in the home depot. The leader is supposed to have experience in the field of public relations in order to facilitate good relationships in the business. Through this way, the leader will be able to set realistic goals for the business thus ensuring transparency and accountability in the organization.