Home Depot CEO quits

[MilDoc]

No CEO should have a "guaranteed" severance package, which they get even for poor performance.

[germdoc]

In a true capitalistic system persons from CEO to floorsweeper would be paid what they're worth. We all know we're not in a true capitalistic system. The system is set up to reward the elite 1%.

Think not? Walk into a bank and ask for a sweetheart loan at low interest. Call up your Congressman and ask for a meeting today. Tell your company you're going to quit and ask for a severance package equal to your entire compensation for your time there. If you don't run HD or GE or some such company, you'll be laughed at. (Just tell 'em you want the same deal Nardelli got...)

I am amused that many, if not most, people who dismiss criticism of such practices (and tax policies that favor the wealthy, I might add) could never in their lifetimes take advantage of the perks. We have all been conditioned by the media and our nation's history to think any of us could, with a little luck, be head of HD ourselves. Just like inner-city kids think they can all be Michael Jordan or Allen Iverson. And have a shoe named after them.

Because I believe in the free market I think that a correction is needed so that CEO's get paid what they're worth.

Getting back to the athlete analogy, without the talent of, say, Michael Jordan, there would be no NBA and no money. Take away MJ--no $$$. However, no company depends upon just one person. Take away Nardelli...and HD might do better!

Something to think about...

[Warren]

I agree, in part, Jeff. Everybody should have a dream. The younger the person the wilder the dream should be. Every kid should believe he can be the best. As we get older, hopefully we get more realistic in assessing our abilities and we adapt our dreams to our capabilities. Still, dreams should require us to stretch a bit. Plus, it's not our assesment of our abilities that matters, it's the assessment of our boss, our employer, friends, teachers, etc. that is the primary factor of our success. Very few people have the drive to ignore what others think and persevere to success in spite of what others think.

Athletes, above entry level, are usually paid based on expectations and past performance. So too are CEO's. Most employees are paid not for what they may do tomorrow, but for showing up and putting in the required time doing the minimum amount of work required today. I am aware of one large North American company that is paying many employees not to come to work. I risk nothing going to work, the person who hired and pays me takes all the risk.

Also, as far as I know, being stupid is not a crime. If a board of directors, a team owner, etc. pays too much for too little value, that's either bad judgement or stupidity. Many, not all, employees I know are not willing to have performance measures in their contract, personal or union. They want to be paid as much as the market will bear and perform at the minimum. Sales reps are, of course, in a different world. Their pay is based on performance. Teachers, cops, pilots, waiters, senators, etc. are paid not for performance but, for what they know and can do. After tenure or a probation period, they are paid simply for showing up, warm and breathing. And, in the case of senators how many votes they can buy through bringing "home the bacon."

Above average CEO's work hard and provide a good return to the company. They are responsibile for the over all health of the company. Sir John was worth every Euro he got. Nardilli? It doesn't appear so, but the shareholders know best. And the stock market and the consumer know better, usually . . . well, sometimes. So, no! Nardilli was a poor choice.

I believe you are seeing the correction in CEO packages happening today. I doubt that Home Depot will make the same mistake twice. If they do, the company will take a beating and possibly not survive. There are consequences for bad business practices. One of them is bankruptcy, another, takeover. It is a self-correcting situation.

Very similar to the big three auto makers having to make painful adjustments to meet the challange of smaller, cheaper cars from abroad. They quickly found that the American consumer was concerned with value, not "Made in America" stickers. Chrysler was so slow that it had to obtain a big loan, read subsidy, from the government.

Adapt or die! If you're not agile and healthy, the bear will get you. The larger the business the more mistakes it can make. Eventually, though, mistakes will get you. They could go the route of GM and be taken over by a foreign company. Or, they could just fold their tent and retire from the field. Time will tell.

There was an NBA before Michael Jordan and it's still there. We love our sports and will pay big bucks to support it. There's always another MJ or LeBron in the wings. Always will be, as long as there's a kid in the backyard or on the playground wearing his MJ shoes and dreaming of big things in future.

[Warren]

I hate to jump right back in but, I forgot something.

Jeff is absolutely right in his first sentence, regarding paying for worth or value. The thing to remember is that the market sets the value, not the employee. Too many GPs, lower cost office visits. Too many qualified janitors, lower paid janitors. Too many Jack Welches, lower pay for CEOs.

If the elite were 50% if the work force, they wouldn't be elite and they'd be paid less.

[rg32]

http://biz.yahoo.com/ap/070106/home_depot.html?.v=2

Might be a good thing but no mention of the reintroduction of the BT3100

[Warren]

I read that in the local paper today. Looks like more of the same. I suspect that it's time to change the board as the board doesn't seem to want to meet the challenge. There are a few top flight CEOs available in the market who are not enamoured with themselves and are able to be flexible and meet change. Most seem to be locked into their style, unable to meet shifting needs. That's why you have to look for a CEO who can tackle the immediate challenges and problems. When he wears out his welcome or demonstrates that he can't change as the times do, you move on to the next one.

A Jack Welch or a Sir John Brown are few and far between. When a company finds one, they do everything they can to hold on to them. I personally think all CEOs should have reasonable performance clauses in their contracts. Actually, I think all employees should have them. The key word is reasonable, which begs the question, "what is reasonable?"

I much preferrred my career to business. Prevent the crime, see the crime, solve the crime. Pretty straight forward, fairly simple, fun and depressing at the same time, with reasonable pay. What more could you ask for?

[Black wallnut]

use caution!

My understanding congress is looking into how CEO are compensated because the shareholder does'nt have as much say so as everyone thinks. They may have say so over board of directers but from my understanding other than getting rid of directors they really don't have as much control over CEO compensation packages as everyone thinks.

Boy that will sure fix it!

The problem is the shareholders turned down a bylaw change to limit compensation packages for top execs at their last annual meetings. (I'm pretty certian I read that in the linked to article that started this topic) IMHO Stock prices are like fuel/ gas prices and bear little resembelence to anything real cost wise; more a matter of emotion and overreaction to stimulii of traders. Take a look at who the stock holders are of all these mega corps........mutual funds where the owners of those are our nations retiriement plans and are being admin'ed by stock brokers. It's a circle! The fact remain that what some consider over compesation is nothing more than just an emotional reaction. It truely has no meaning and top Execs and athletes and entertainers will always make way more than you and me. If that pisses you off change your profession! If that is not an option stop whineing because of envy! If you think it's unfair you could move to a socialist country where the market does not decide wages and starve.

I for one am glad that my salary is not based on someones "objective" criteria and my performance in meeting it. I'm not saying that I'm getting more than I deserve but will say that on my last eval I'm not entirely impressed in how objective my supervisor was in all categories. Since I overall received excellent marks there was no need to get into a pissing contest with him. Oh yeah btw I sure as heck am not a top exec, just a lower level manager. The job I do on a daily basis helps to ensure my companies profitability for its' owners.

Sorry for the rant folks but class envy and pissing matches over what the rich have just bug me! It's better to focus our energies in the direction of woodworking where we can make a difference!

[MilDoc]

From the above article:

"Home Depot is much more of a warehouse. Lowe's is much more of a shopping experience."She called Home Depot stores "cluttered, dark and dirty."

Couldn't agree more. Add to that few and far between staff who often don't know what's in the store, or much about anything. and I stick with Lowes.

[Warren]

Paul; your second observation was also mentioned in the article. I think HD lost focus on service and concentrated on growing the number of stores. They opted to relegate service and customer base growth to less importance. Obviously they have had their "peepee" severly spanked and, judging from their choice of new CEO, did not learn much from the experience.

The new CEO did say that he would spend the immediate future speaking with associates at all levels. Hopefully, he'll be asking questions and seriously listening to the answers. In a couple of months we should be able to wak into the local HD and tell, immediately, if he is having any impact, good or bad. My local stores are some of the furthest away from the home base and I'll be interested to see what, if any, changes occur.

The newest store has a pretty dynamic manager and he's kept the service level up. The older store is about like what everybody else on the forum describes; hard to find assistance, impossible to find knowledable assistance, dark and disordered.

[Steelnsilk]

Guess I will ....

Stay with Mennards. Friendly people willing to help, better prices on what I have needed so far even tho they are further away than Lowes or HD.

[MilDoc]

Wish we had Menards here, keep hearing good things about them.

[BigguyZ]

I love Menards for about 80% of my shopping. Even though some of the items they carry are just plain junk, they have been starting to offer more high end tools and machinery. They have DCs and Planers and Jointers and Mortisers.

I do like Lowes for sheet good though. Their prices on full sheets are cheaper than the handy panels Menards or HD sells, and they'll cut them to whatever size you want. I've never paid for them to cut the wood either. Too bad they're not as close as I'd like them to be...