RPO Summit final thoughts: Home Depot’s story

Posted by: Matt Rivera

On the last day of the RPO Summit, attendees were treated to the amazing story of Home Depot’s meteoric rise and resulting HR challenges during the early part of the past decade. The story had great impact and solidified for me how talent is crucial to the success of any business.

Dennis Donovan did a fantastic job relating how he came in as chief of HR during a turning point in Home Depot’s explosive expansion in 2001. The short story is that in a brief seven-year span, the company would go from perhaps a few thousand employees to hundreds of thousands of employees.

Donovan is an HR executive. But as he was relating the story, it became clear that he was a great project manager too. That skill, along with his ability to relate HR principles to business goals, is the reason he was able to transform HR at Home Depot.

Specifically, I found a few nuggets of wisdom that can be applied to anyone who is dealing with change. And let’s face it. Whether we like it or not, the world has changed and continues to change at an unprecedented rate. Here are a few I picked out:

• “Success is based on the company’s ability to change.” This is true now more than ever. And your ability to acquire, retain, and manage talent is central to your ability to change quickly and successfully.
• “Link change to competitive advantage.” Changing is one thing. Knowing why you are changing and how the change will give you a competitive advantage, increase sales, increase productivity, reduce costs, etc., is important to understand and measure. Your workforce plan and the talent you employ are the motors to gain this advantage.
• “The speed of change is determined externally.” This is great wisdom. So many times we base plans on what we have now, how we did it before, or simply when we think we can get it done. The market won’t wait for you. If you don’t have the talent, go get it now. You need diverse ideas, more hands, and solid leadership. These all point to talent.

My interest was piqued when he also talked about things like employee engagement, development, and technology.

• “Leadership drives employee engagement.” He noted that there is a direct correlation in study after study that says leadership drives employee engagement, which in turn drives customer loyalty and ultimately business results. So if HR or a few managers are the only ones working toward engagement, it might not have the impact you think. Get leadership bought in and involved in employee engagement at all levels (including contingent labor).
• “With technology, it’s 80 percent process and 20 percent systems.” He went on to say that so many times organizations press the default button. We need a system. But what you really need is good process. For me, it also emphasizes the fact that leaders need to understand and support the processes, so that when you bring in technology, it enhances the processes. Too often I see companies worrying about an executive seeing the demo, or looking for a specific bell or whistle. The process is the real key. (And no one uses even half the bells and whistles in most systems.)
• “If I have a buck to spend, I’ll spend 99 cents on developing good leaders.” He acknowledged it was a bit of an exaggeration, but he said it’s the most important thing you can do. I think right now many good leaders are getting ready to leave because they don’t see any development opportunities (or engagement efforts).

Those are pretty strong reasons to focus on good workforce management in your organization. But more importantly, it illustrates the way everything is related to talent and leadership’s ability to engage and leverage talent.

He didn’t spend much time on the question of outsourcing or the supply chain, but he did note very strongly that the structure of your company is not within the walls of your organization. It consists of your company, your customers, and your suppliers. Focusing only on your organization chart is thinking only inwardly.

Since we are at the RPO Summit, it was great validation that both customers and suppliers are vital to the success of an organization. Who you choose to help you find and manage talent is part of your structure and greatly impacts your ability to service your customers.

Lastly, he did say that HR resource planning is the most important thing you can do, and a top priority for the world’s best CEOs — more important than strategic planning or operational planning.

With the shift in the workforce we’ve noted in our latest Workforce Trends Survey, keep in mind that the flexible workforce needs to be part of this resource planning now and in the future. An important thing to keep in mind as we look toward 2011.