Business Week recently described how Marvin Ellison, Home Depot’s newly-minted Executive Vice-President of U.S Stores, improved the store experience in the wake of Bob Nardelli’s infamous tenure. Nardelli made several decisions that have been widely criticized, including some explicit cost/service tradeoffs that eroded Home Depot’s core advantage. An earlier BW article described Nardelli’s run this way:
His military management style led to 100% turnover among his top 170 managers by the time he left the retailer in January. His cost-cutting moves replaced experienced salesclerks with low-wage students, devastating customer service and handing market share to rival Lowe’s.
Fast forward to today, where Home Depot’s service experience has been transformed by Ellison’s leadership:
Sarah Larsen used to avoid Home Depot, having dealt for years with surly, hard-to-find employees and indifferent store managers. But about six months ago, faced with a major renovation project, the Naperville (Ill.) communications consultant gave the store another try. She immediately noticed the difference: Sales associates were friendly, helpful, and in large supply. Now, Larsen says, “it has become my go-to store.”
Ellison made a number of crucial service plays, but I was most struck by his decision to limit the amount of communication that central managers could have with store personnel. Essentially, Ellison told senior managers that they could communicate with him as much as they liked, and that he would be responsible for store performance. But they could no longer communicate (read disrupt) store personnel directly. In some cases, this meant reducing the number of daily e-mails and reports that store managers received from 200 to one. He also gave his stores just three metrics to care about — cleaner warehouses, stocked shelves, and top customer service.
Ellison made it crystal clear that managers’ most important constituents were the people in their stores — their customers and the employees who serve them — and not their corporate superiors pestering them from headquarters. Ellison became a buffer between senior management and the front line, which created the time and space for his people to focus on what really mattered:
More important, Ellison is enforcing a practice called “power hours”—weekdays from 10 a.m. to 2 p.m. and all day on Saturdays and Sundays—when employees are supposed to do nothing but serve customers. They can stock shelves, unload boxes, and survey inventory at other times. “We could not address customer service needs because we were too busy doing other things,” says Ellison.
The results? CEO Francis S. Blake explained Ellision’s rapid rise this way: “You could go blindfolded into two stores and know when you were in Marvin’s store.” Marvin’s stores, it turned out, had the sweet smell of success.