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  1. #46
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    Apr 2003
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    Quote Originally Posted by KickSave View Post
    Talk about cherry picking numbers? In the same basic time frame referenced, HD's biggest competitor, Lowes, saw revenues increase from $15.9B in 2000 to $43.2B in 2005 (2.71X), with earnings going from $672M in 2000 to $2.7B in 2005(4.01x). Those percentage increases dwarf Home Depot. But the fact that both companies gained huge numbers in sales and earnings is hardly a testament to either CEO, its much more directly attributed to the fact that it was basically the peak of the home buying boom, with all segments of home improvement seeing corresponding obscene jumps.

    If you want to put those gains on the shoulders of the CEO's, then Lowes CEO beat the living snot out of HD's CEO in the same time frame when basically you or I could have achieved massive gains running those companies. HD's CEO should have been fired for watching his biggest competitor sail by him and wave his hand out the window of his Bentley as the Home Depot CEO drove his bicycle down the same road.
    Yup. This more squarely sheds light on the problem. When times are good, CEO pay rises. When times are bad, workers pay decreases. I use good and bad loosely. In those "good times" the economy is over-investing in one sector at the expense of others, and in "bad times" the economy is redistributing those investments more evenly. I'd classify it the other way around, but our current system turns "bad" and "good" on their heads.

  2. #47
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    Sep 2004
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    Richfield, MN
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    Quote Originally Posted by KickSave View Post
    Talk about cherry picking numbers? In the same basic time frame referenced, HD's biggest competitor, Lowes, saw revenues increase from $15.9B in 2000 to $43.2B in 2005 (2.71X), with earnings going from $672M in 2000 to $2.7B in 2005(4.01x). Those percentage increases dwarf Home Depot. But the fact that both companies gained huge numbers in sales and earnings is hardly a testament to either CEO, its much more directly attributed to the fact that it was basically the peak of the home buying boom, with all segments of home improvement seeing corresponding obscene jumps.

    If you want to put those gains on the shoulders of the CEO's, then Lowes CEO beat the living snot out of HD's CEO in the same time frame when basically you or I could have achieved massive gains running those companies. HD's CEO should have been fired for watching his biggest competitor sail by him and wave his hand out the window of his Bentley as the Home Depot CEO drove his bicycle down the same road.
    Perhaps I fired my "idiotic" line too early in this thread. Also, in what world is Lowes going from 1/3 of HD's revenue to 1/2 "sailing past them"?
    If the majority distributes among itself the things of a minority, it is evident that it will destroy the city. --Aristotle
    If we did all the things we are capable of, we would literally astound ourselves. - Thomas Edison

  3. #48
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    Apr 2003
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    Quote Originally Posted by Vin Lombardi View Post
    Perhaps I fired my "idiotic" line too early in this thread. Also, in what world is Lowes going from 1/3 of HD's revenue to 1/2 "sailing past them"?
    Growing at twice the rate in a market where you basically had to punch customers in the face when they walk in to make them not buy from you. CEO's are not just compensated on revenues and and earnings, but on growth. Lowe's CEO did a better job in an easy market from 2000-2005. Since Home Depot replaced Nardelli, the disparity in growth of both sales and earnings has not only switched, it now favors Home Depot. Incidentally, Lowe's appointed a new CEO in 2005 also.
    "What's so funny about peace , love and understanding?" - Elvis Costello

  4. #49
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    Some more info about Nardelli's time at HD.

    After Nardelli resigned as Chairman CEO on January 3, 2007, amid controversy over the company's stagnating stock price and poor customer service as well as Nardelli's salary, Blake was elevated to these positions. Although a longtime deputy to Nardelli at GE and Home Depot, Blake has been said to lack Nardelli's hard edge and instead prefers to make decisions by consensus. Indeed Blake repudiated many of his predecessor's strategies, and it has been reported that the two men have not spoken since Nardelli departed Home Depot.[2]

    Nardelli had pushed hard to make the company more efficient, instituting many metrics and centralizing operations, while cutting jobs to meet quarterly earnings targets. While this initially doubled earnings and reduced expenses, it alienated many of the store managers and rank-and-file store associates, and by extension the customers, resulting in a drop in same-store sales which is a key metric that analysts used to gauge the company stock. Nardelli, who regarded home improvement store-by-store sales as less important due to market saturation from competition such as Lowe's, aimed to dominate the wholesale housing-supply business though building up HD Supply, a unit that Blake sold for $8.5 billion in August 2007 since it was not part of Home Depot's integrated business.[3]

    In comparison to Nardelli whose numbers-driven approach never appreciated the role of the store and its associates, Blake's strategy has revolved around reinvigorating the stores and its service culture (engaging employees, making products readily available and exciting to customers, improving the store environment, and dominating the professional contracting business, an area in which Home Depot's closest rivals trail far behind), as he recognized that employee morale is a more sensitive issue in retail compared to other industry sectors like manufacturing. [4] Blake was given credit for returning to the "Orange Apron Cult — the nearly religious zeal for knowledgeable employees and high levels of customer service that was the secret of the company’s original success", as he believed that customer service was the key to Home Depot to differentiate itself from competitors on aspects other than price. [5]

    Under Nardelli's tenure, Home Depot's stock performance lagged behind rival Lowe's, however this situation has been reversed under Blake.
    "What's so funny about peace , love and understanding?" - Elvis Costello

  5. #50
    Join Date
    Jun 2002
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    10,371
    I want to get a "job" sitting on a corporate board of directors in my old age. Even small publically held companies it's a low-to-mid 6-figure salary for meeting once a quarter for a day or two. At my company it's a bunch of old white hairs in their 70's who are more concerned with the catering and making sure they all have a comfortable chair than actually guiding the company.
    The cake is a lie. I'm pretty sure the numbers in the pie chart are made up too.

  6. #51
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    Sep 2004
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    Quote Originally Posted by Dave View Post
    I want to get a "job" sitting on a corporate board of directors in my old age. Even small publically held companies it's a low-to-mid 6-figure salary for meeting once a quarter for a day or two. At my company it's a bunch of old white hairs in their 70's who are more concerned with the catering and making sure they all have a comfortable chair than actually guiding the company.
    Sweet, just put in the work now to qualify yourself for that job when you hit 70. Sounds like an easy layup.
    If the majority distributes among itself the things of a minority, it is evident that it will destroy the city. --Aristotle
    If we did all the things we are capable of, we would literally astound ourselves. - Thomas Edison

  7. #52
    Join Date
    Dec 2004
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    Promised Land
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    Quote Originally Posted by Vin Lombardi View Post
    Sweet, just put in the work now to qualify yourself for that job when you hit 70. Sounds like an easy layup.
    You mean agreeing to OKing all golden parachutes? Nice work if you can get it, as I say.
    I've got binders full of women
    and a one point plan.

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