Home Depot E-Business

Founded in 1978, The Home Depot (Retail) is the world's largest home improvement specialty retailer and the second largest retailer in the United States, with fiscal 2005 sales of $81.5 billion. The company employs approximately 345,000 associates and has 2,056 stores in all 50 states, the District of Columbia, Puerto Rico, U.S. Virgin Islands, 10 Canadian provinces and Mexico. Through its Home Depot Supply Division, the company operates one of the nation's largest diversified wholesale distributors, with operations in 41 states and Canada. The Home Depot has been recognized by FORTUNE magazine as the No. 1 Most Admired Specialty Retailer and the No. 13 Most Admired Corporation in America for 2006. According to the income statement the profitability of the Home depot is healthy and it has increase to the $5.8 bn in 2005 and also Sales have grown to $81.5 bn.

The company was also well known for its entrepreneurial and laissez-faire culture, a culture fostered by co-founders Bernie Marcus and Arthur Blank, who led the company from 1978 to 2000. In late 2000 however, the board appointed Robert Nardelli, a GE veteran, as CEO. Nardelli was given the task of solving the problems that the company ran into in the late 1990s.
Home Depot's culture from an entrepreneurial and informal one, to one that focused on processes. He also introduced a fair amount of centralization and managed to link the various departments and regions of the company together.

The company operates The Home Depot Stores that offer an assortment of merchandise and services, including building materials, lumber and millwork, plumbing, electrical and kitchen, hardware and seasonal, paint, flooring and wall covering products, generators, and furnace and central air systems, as well as provides installation services, such as carpeting, flooring, cabinets, countertops, and water heaters. The Home Depot was founded by Bernie Marcus and Arthur Blank in 1978. The company is based in Atlanta, Georgia. The Home Depot, Inc. acquired Hughes Supply, Inc. in March 2006.
The Home Depot also operates EXPO Design Center stores, which provides home decorating, remodeling, and installation services for middle-to upper-income DIFM customers. It also offers products through its Web site, www.homedepot.com.
The Home Depot sources merchandise from over 40 countries. We directly import from 268 vendors, with 555 factories. Over 80% of our products are sourced from five countries and 40 vendors. Repeat buying from known suppliers and factories allows The Home Depot to build standard supply chain processes.

Steps of ebusiness conversion

The Home Depot had tried to remain update with technological movements. It was first to deploy wireless Java applications in its stores In JUNE , 2001 The Home Depot Inc. announced that it's embarking on a sweeping enterprise application integration (EAI) effort and pushing customer relationship initiatives that analysts say have been lagging in the retail market. Through it, it has been able to tie together thousands of applications, stores and systems in real time. It has also been able to share data with partners and individual stores. Home Depot has a customer relationship management (CRM) application. The application lets call center agents access information about product pricing, delivery and installation schedules. It has increased customer satisfaction and as well as freed up store personnel. All products and services of CO are also available on Net and it has robust platform for it. It also helps to educate the customer and make them ready to make buying decisions.

In October 2002 it initiated Web-accessible data warehouse for initially to be used for human resources functions. Eventually it is being used for supply chain, inventory management and replenishment operations. It takes near-real-time feeds of sales data and assist with pricing, inventory forecasting and space management inside stores. In Dec. 2002 it upgraded point-of-sale systems and self-checkout stations

In May 2005 The Home Depot Inc. decided to deploy a suite of software products based on the SAP for Retail product offering. The home improvement retailer intends to use the software to improve its merchandising and supply chain activities. SAP and Home Depot also agreed to collaborate in the development on new applications aimed at the retail market.
It is also using RFID and other modern system which helps in all activities related to Supply Chain, particularly accurately trading of its merchandise. It has also robust dedicated accounting system to support it's entire operations.
Thus all the above initiatives are helping Home Depot to delight the customers and implementing operational excellence.
Hence they have transformed value propositions of goods and services offered. The ultimate aim is to provide a complete end to end consumer experience---right from the promise to satisfy his need to its delivery. They have adapted the ecommerce and the other new wireless technologies to improve its supply chain management. It has integrated the system of the organization with its vendors and customers with the help of new technologies such as XML, EAT and wireless protocols. (HomeDepot, 2007)
Its using e-business concepts and Web technologies to manage beyond the organization, upstream and downstream logistics. They are unifying all steps in the business cycle, from initial product design and the procurement of raw materials, through production, shipping, distribution, and warehousing until a finished product is delivered to a customer. It has developed efficient network of suppliers, vendors, and distributors to disseminate information and enable two-way communications. Thus ecommerce enabled supply chains are helping them in gathering buyers and sellers and facilitate and enable transactions online.

Moreover internet technology has also allowed a level of collaboration between previously loosely affiliated partners in the supply chain, which would have been difficult or prohibitively expensive in the past for all but the biggest producers or retailers. It leads to collaboration over product designs and production planning. It has also adapted disintermediation as they are selling directly to the consumer through their websites.
Home Depot has connected directly with consumers and shorten the distribution chain. This is helping in elimination of inefficiencies, decreasing the product delivery time.

Disintermediation is great to go direct to the end user. Through e-commerce Web sites, one can track consumer behavior, deliver strong branded messages to an attentive user, and showcase product. This is fast becoming a more obvious answer for many companies, especially large ones who have traditionally depended on distributors to carry their brand in-store.

Some concerns and limitations

Trustworthy in online businesses, when working with clients/business partners/suppliers, he or she is placing web site trust in the business. It is essential to hold onto that trust dearly and don't do anything that would harm it. They trust the business to help them out on the Net. Also, to build and retain the trust, accessing unauthorized areas in the trading system should not be allowed, and the privacy of partners/customers should be protected both technically and legally.
Legal Issues-There are various laws regulating the internet and e-businesses. There are CAN-SPAM, gambling laws, the Federal Telecommunications Act and the Computer Decency Act and other laws which must be considered before venturing into b2b and b2c sites.
B2B must adhere to the existing laws on conducting online business. It must not be used for any purpose that is unlawful or prohibited by the terms, conditions, and notices of the local laws.
B2C websites have more legal responsibilities for conducting their businesses with integrity and lawfully protecting the privacy of their customers. Customers provide details of important personal information and credit cards over the website to facilitate the purchase of goods and services.
Complex legal issues such as intellectual property, competition, privacy, consumer protection, equal access/opportunity are to be addressed by both B2B and B2c sites. Issues such as intellectual property, competition find more ground in B2B sites whereas consumer protection, access, confidentiality, sustainability, reliability are more important in B2C site.