Cover Story: HOME DEPOT
CHEERLEADING, AND CLERKS WHO KNOW AWLS FROM AUGERS
Even though it's just 6:30 on Sunday morning, all hands are on deck at the Home Depot store in Doraville, Ga., for "Breakfast with Bernie," a session with Chief Executive Bernard Marcus and President Arthur M. Blank. Employees at dozens of other stores are tuning in to watch Marcus and Blank via Home Depot's own broadcast system. Cheers break out in Doraville when Marcus announces 1991 results: sales up 35%, to $5 billion; profits up 52%, to $249 million; sales in stores open a year or more up 11%. Then Marcus rolls a video lauding some San Diego employees who helped a foster mom build an addition to her crowded house.
Relentless cheerleading and a healthy dose of schmaltz: It's pure Home Depot. But beyond the atmospherics, Marcus relies on intense training to build a knowledgeable sales force--and offers lucrative employee stock plans to instill a deep devotion to service.
SEIZE THE LIST. It's the training that makes the 13-year-old, 188-store chain stand out in a crowded business. Home Depot's sales staff can offer on-the-spot lessons in tile-laying, electrical installations, and other projects. New hires, who are often experienced electricians or carpenters, start with five days of classes that include lessons on everything from company history to how to greet a customer. In a recent class at an Orlando store, for instance, assistant store manager Chris Brumfield tells workers to greet shoppers, then ask "What project are you working on?" That way, employees can go through customers' lists with them. "Remember," says Brumfield, "if they forget something, they'll get frustrated. More than likely, they'll be mad at us."
After class, new staffers spend three weeks tethered to a department manager learning how to order, stock, and sell. Employees then learn about the rest of the store, which stocks some 30,000 items of hardware, lumber, tools, lighting, and plumbing supplies, all priced well below the offerings at traditional hardware retailers. "Never just point to another aisle," instructs Brumfield. "Walk the customer over and find someone to help." Salespeople regularly attend seminars on paint, tile, and other merchandise that help them answer questions.
Nonstop questions are what anyone wearing an orange Home Depot apron can expect. On a recent Monday at the Orlando store, Ernie Palisin, a manager in the floor coverings department, handled at least 50 inquiries. When he showed a woman where she could get some hinges, at least five people flagged him down. He found salespeople to help all five. Some shoppers grumble at the crowds, but most of them give the retailer high marks for its service and selection. Says Atlanta resident Frank Brannon: "When you own an old house like we do, Home Depot is a godsend. You know where you can find me every Saturday morning."
It helps that employees have the right motivation. Commissions are out: Home Depot wants to sell customers what they need, not what boosts a salesman's take. Instead, employees who have worked a year can join a retirement plan that doles out shares. And from assistant managers on up, employees qualify for other lucrative stock options. Managers also get plenty of autonomy. Palisin in Orlando organized a tile class on his own for customers each Saturday afternoon to help control the backup of questions from shoppers. "At Home Depot, you just do it," he says.
That's not to say that Marcus and Blank don't work to keep Home Depot's selling edge sharp: They spend up to 40% of their time in stores. But can they keep their hands on as the company recruits more and more salespeople? Already, Marcus has had to delegate some management training. Still, he swears his high standards won't slip: "We've been able to preserve our culture from 5,000 employees to 30,000 employees, so I see no reason why we can't go to 100,000." That would add up to an awfully big crowd for Sunday breakfast.Walecia Konrad in Atlanta