Please give a warm Georgia Tech.

Welcome to our guest Mr Frank Blake.

We are so delighted Mr Blake to
have you here and we are honored

to have you as a speaker and to be able
to talk with you and ask some questions.

I just wanted to let you all know that

I have a few questions that I
have put together for Mr Blake.

But we're also going to have plenty of
time for questions from the floor and so

be thinking about what you
might find intriguing and.

I'll jump right into this and start off
by telling you that I'm renovating my

basement and I thought if I showed you.

Maybe now I'm just kidding because I
figured if he's running this bill he

multibillion dollar business he can
probably help me figure out which watches

I know I'm just getting you know
I'm just fascinated when I look at

your career path and the fact that
you were a lawyer for the first

Bush administration and now you're
the chairman and C.E.O. of Home Depot.

Can you tell us a little
bit about that story and

how you got there about yourself.

Sure.

First thank you all very much for
inviting me to do be here.

It's a great privilege.

We have from a lot of Georgia Tech
representation at the Home Depot

both a lot and I and some folks
who are now at the school so it's

great to see some armed aprons around the
room and it's a real honor obviously to

be able to speak here at Georgia Tech also
want to thank this is William's as well.

Reference that this is the spring
speaker series which feels

really good that we're about
to get into spring and

misses way of talking about putting career
Virgine on the Long Island of Oahu how

as part of the thought process so
again it's a great honor to be here.

So I just as you were saying I have

I have a resume for this job and career.

It's it's a little hard to describe.

I'm a lawyer by training.

I stopped being a lawyer
about fifteen years ago but

it was a pretty in direct
path of the Home Depot.

Ultimately what got me to the Home Depot
was it's a it's a company with a great

culture a lot of passion in
the business and at the same time for

all of you and I hope there are a lot
of students in the room who planned on

the career in retail retail
is a very demanding and

exacting profession and so one of
the things that makes some people so

interesting is that combination of
passion around customer service and

the same time a lot of attention to
the details and how you execute every

day to make sure that we have the material
in stock that the customer needs and

we have the right customer
service levels in our stores.

So there's a long that's a long winded
answer say there's no good explanation for

how I got here.

If you said replicate this on purpose.

You couldn't possibly do.

That's a great answer.

And we see we see that among so
many of our top business leaders and

in fact and we've very nicely into my next
question you may recall that when Rachel

introduced you she talked about
your renowned leadership style and

that clearly has been something that
has really driven your career and

a lot of the successes at Home Depot I
was mourning if you talk a little

bit about your management
leadership style.

So it's of the first thing
is I'm not sure I'm not sure

I think of something as my style.

That's an interesting thought but I would
what I would say is that there are a lot

of people that I've learned things
from in terms of leadership that

I try to incorporate the first

as I have as you reference I've had
the opportunity to work for a lot.

Extraordinary Leaders and learn a little
something different from each one of them

some in politics some in business.

I worked for George Bush father when
he was vice president actually not when

he was president and one of the things
I learned from him was every day.

So you got a picture in your mind the vice
president's staff the very small staff

because no one cares right.

Fundamentally irrelevant you
know difficult office and

it was interesting watching him
because what he would do every day at

the start of every day he would come in
and he would spend an hour and at the time

you got to this is back in one thousand
names he would be on his typewriter and

he would type out notes and he'd spend an
hour a day typing out notes to people and

when as a member of your of his staff.

You got a note from the vice president and

I have states that noticed
something you did recognize too for

something you just walked on air for
a while and he sent these farm why.

And later in my career when I was
selling power plants in Indonesia.

I actually was talking
got me posting aside

he says no you're going to win this
project and I said that's great.

We got the grass best product best price.

So I said no you're going to win this
project because I saw you work for

Vice President Bush and

when I was alone a deputy to the something
something in the Indonesian UN mission.

I got a note from him and
we corresponded from then on and

he's an amazing man and I do you
know you're part of the family and

you go on what you learn from
a leadership perspective is

how much we all thrive on recognition and

the time you take to recognize people for
what they do is one of the most

important things you can do in
the job something I try to do it for.

People are had the opportunity
to work directly for

Jack Welch and
kind different left for exactly

the opposite area high
energy intensive person

and you just one of the interesting things
about them go easily the smartest man

I've ever worked for
is an absolute passion around simplicity.

So even if there was anything and

it took you a long time to
explain what you were doing.

He just said you don't
know what you're doing.

If you can't express it simply if you

haven't thought through what
you say in the elevator.

You don't understand what you're talking
about and that's actually pretty true.

You have to you have to make sure you're
driving is as I like to say the job of

leaders managers within an organization
is you absorb the complexity up and

drive simplicity down and
organization sometimes tend to get that

the reverse they drive complexity down
they keep things simple where they are so

that was an important lesson and
then finally I'll be honest

the one of the most interesting
leadership lessons comes from

a local pastor here in the Atlanta area
and when I was just starting this job.

Somebody happened to give me a CD of his
this is a new Stanley on leadership and

how you think about leadership and
you talked about which I think is true.

I mean this isn't a religious comment
this is a business comment that you

have to start with what's
your vision is you have to

celebrate that be within the organization
so you have to take time.

Begin to recognize and celebrate the
people who are doing the right thing and

then you have to live it so

within the Home Depot if you see
our folks with the aprons here we

have our values we feel very strongly
that we're values based business we talk.

About our values.

Hopefully we celebrate our values and
even more importantly we live our back

and it's an interesting kind of
self reinforcing the more you live

your values the more comfortable you're
talking about the more you talk about all

of these here is to celebrate them as sort
of an interesting self for saying so.

Now I want to invite you to speak with
my business that business ethics class

too because I could tell you be terrific.

Let me switch gears for a moment and
ask you more of a business related

question of course we all know
that this is a tremendous and

has been a tremendously
challenging economy.

And also as part of this
very challenging economy

we're seeing a combination of increasing
regulation and a lot of areas and

regulatory instability and I'm wondering
how you and your leadership team have been

trying to sort of veer you're successful
business through those challenges.

So for us it's been more of
a function of how do you just

to be dramatic decline in our market and

obviously the country as a whole has had
a lot of economic pressure over the last

several years things that are housing
related in particular have had a difficult

time and we sometimes forget
how if you live it day to day.

You forget how much change you actually
have to drive within an organization

to adjust my analogy internally and
there are not many of you.

This is too you know crowd to understand
this but it's like going ball day to day.

You don't notice it and
one day you wake up and you go nuts.

I'm We've all done well that's kind of

what happened to the housing
market in the U.S. and

really the adjustment process last around
the regulatory path and more around.

Every single for
those a lot of people in this room or

some people see this
room Work at Home Depot.

You know that every single part of
the company has had to adjust and

change how we've approached
our business in order to

survive in a really really
tough economic Christine.

This might this might
Barbara Walters' get them to cry.

Question What keeps you up and
I just I'm so

two answers to that the first
thing is everything.

People have and I think you know
I'm a lawyer by training so

I think kind of what lawyers
are trained to do is worry.

I mean I think part of the function
of legal training is you

take things that no normal human being
would worry about you train people for

three years to worry about them.

So it's hard to it's hard to break
that habit but if you said more

generally what you are worried about
the number one issue I think for

every first some mortar retailer is the
Internet and the impact of the Internet

you can sit in the comfort
of your own home and

order a product online and
have are shipped to your house.

Sometimes we appreciate men and so why do

you get off your cell for cash and
leave and go into a store and

what's the experience in the store that
makes it worthwhile to leave your house

and that's that's why I think we spend
our time worrying about making sure that

our customer service levels improve
that are in stock rated proves that

the value statement is there in
the stores because I think the bar for

performance on retailers has been
raised by ability so simply work.

I'm going to ask just one more question
to make sure we have lots of time for

our viewers but
this is one I think that's always a.

Interesting to you
particularly our students.

We have as you know amazingly
bright students and

they're extremely ambitious and many many
of them are going to do extremely well and

they are all very interested in managing a
career trajectory managing a career path.

Do you have any other personal insights
experience or advice that you can provide

our students for
successfully navigating a career path.

So everybody's advice is personal
to their his or her own experience.

So you can just take this for
what it's worth.

I'd say the first thing is
don't worry about titles.

Don't worry about.

I mean just people get to Path focus worry

about what you're doing worry about
the problems are solved careers

are a progression of solving
more more difficult problems and

if you're engaged and
energized by the problem for

solving the issues you've got and the
people you're training good things will

happen if you're not you'll You won't
like your job or you don't like your job.

It's hard to form.

So look for the challenger is what I'd
say generally speaking in your career.

Look for the challenges.

Look look for what it's like.

Thank you.

As I said it's very important to us
that we get lots of your questions and

so what I'd like to do is
if you've got a question.

Raise your hand.

I'll try to see the whole room here and
I will call on folks

wait until someone with a microphone
comes and hands it to you before.

Yes your question.

So questions.

And we've got one right there.

My question is with a large firm like
Home Depot How do you keep it off.

Yeah.

So the first response to that is.

That is an ongoing struggle
that we don't always succeed.

I'm fond of saying

the challenge with any large business
there's a great chart on this from

Jim Collins as could pick a great book
that shows just a simple four blocker.

And on the X. axis his
entrepreneurial spirit and on the Y.

axis is discipline and what you see
is if you can imagine this over for

a block or if you see out on the high
entrepreneurial spirit no discipline

tend to be your start ups
as you move to the Laugh or

lesser entrepreneurial spirit.

If you have no entrepreneurial spirit.

No discipline your bureaucracy.

I mean you know my personal
view if you're the government.

You know if you get no entrepreneurial
spirit behind discipline

your hierarchical corporate structure
which is pretty easy to drift into

the great companies are always
on the upper right side which is

high entrepreneurial spirit and
high discipline that balance.

You never get it right.

One time and walk away.

It is a constant fight and

we like you know in Home Depot.

We like to talk about
our ditch to ditch and

we do that ditch to ditch our will we
are rapidly over to entrepreneurial and

it will Anspaugh all them will go well and
then we'll go all the way

other to the other side of the ditch and
we'll get very disciplined.

I would say that's the single biggest
challenge in the single thing we

work the hardest at is to maintain
that balance both in the stores and

in the end in our stores.

Under question it's over there somewhere.

And we've got one right down here.

Good evening.

So I have two questions What be you

up to ninety from President's
office do the see and

the second is what made you choose
these app runs as a discord.

Well so.

Let me answer the second
because I did what the founders

of the company chose aprons and
it's a great question.

I don't know why they did I don't
know why they chose the color.

I don't know why they chose it for
this but they're both great choices and

will always be worth a prince and
they'll always be art.

It terms of in terms of personality change

in the job I would say I'm not sure.

So much a personality change but

certainly a focus change I'm
a little bit of a story.

So I got this I got this job now
four years ago in two thousand and

seven was not expecting it was
not very well prepared for

it and thought OK well I'm
going to go see Jack while

he's got some business leader
I'll learn from him so.

So I went down to visit him in Florida and

I was fully prepared on all
the numbers of the business.

I expected to talk a lot about our
gross margin rate I expected to be

talking about inventory turns
the kinds of things that I used to

talk about when I was a G.E. not of work.

We spent four hours talking nothing but

about the people in the company
is saying what are you.

This person.

What are their strengths and weaknesses.

What you do for their weaknesses
what you do with their strengths.

That's all we did before out and
that was an eye opener for

me saying that it's really
the job starts there and

it wasn't something that just just
spend more time on that thing.

Excellent.

We have one down here.

I have two questions.

So coming on board in two thousand and

seven you get the opportunity
to move up as a C.E.O.

great but
you're going into a retailer if it

a large retailer in a time
where you know rough times.

So the first thing is that you know
how do you change the culture.

How do you drive morale.

You know of a team of talent that
could say hey listen you know we

were going into a time where we might be
losing our jobs centrally you know how do

you make people feel comfortable hot
you know not only still come out and

drive them into you know wanting to you
know to get through this time rough

time like they have I mean you know so
OK so

the truth of the matter is and
if it had been

my job to create a culture within the Home
Depot starting in two thousand and seven.

I'm pretty sure I wouldn't be here
that would have been an enormous and.

Extraordinarily difficult tax benefit I
have was the culture of the Home Depot.

That was set by our office
it's actually a pretty strong.

Culture.

It was actually a culture that was I
think always there just looking for

a little bit more cars money and
so it was more

it was more of a statement of
who people wanted to be and

how we kind of wanted to be
focused on retail and we wanted.

Actually to reclaim the cultural
distinction of the business.

So I look at it is more a function of you

know maybe it was it was puffing up or
something or allowing to revert but

it wasn't it wasn't establishing it from
a blank sheet which would have been for

three hundred thousand people just
an extraordinarily for an early call.

It's the second question I had
was you talked about the you

know the buying patterns of you know home
improvement in some of the merchandise and

that you have this more in the dot com
side so I think from my knowledge of where

that it's a billion dollar business right
now roughly comes through the website.

How do you see that changing what
percentage obviously you guys are looking

to grow in that area and what will
ultimately ten years on why would you

think that business from a percentage
wise looks like yeah I think for us.

I mean the first comment I'd make is you
know we don't really talk much about

the revenues from Mark dot
com business externally and

don't really have targets for
what the revenue should be on dot com

because we really look at it as part
of an interconnected experience.

I think personal belief so you know
here's what step worrying about which is

what's the Internet do to experience and
with the bricks and mortar retailer.

I would flip it around the other way and
I would say also a virtue more retailer.

That has a great Internet experience
should have an enormous advantage

because it should be the case that you
have a very seamless experience of being

able to buy something online
pick it up and store.

That's a huge initiative for us.

You should be able to go online and

understand what the inventory is in
store which we're now turning on.

So it's really more it's less about dot
com as an independent revenue source and

or About dot com as a source of knowledge
for our customers as a source of

research for our customers as a source
of convenience for them when for

whatever reason the retail presence
the bricks and mortar presence is what.

I mean look over my shoulder and see this
side of the room over here we've got

a question and
I think we've got a young lady in kind of.

In quite a bit there.

My question as you talk
about store experience.

And I work retail and I know that

different chain stores around the country
have different store experiences but

how do you make sure that each store
is providing that same experience that

the company is it's a it's
a great question and

obviously and enormous challenge
with over two thousand stores.

So one of the things that that we've
done over the last few years is

we have something that we call power hours
in our store and drawing power hours which

typically are you know from ten to two
in a week day and then all weekend.

Our expectation of associates is that
they do nothing but customer service and

if you think about Home Depot which is
under thousand plus square feet with

thirty thousand plus different
units that scale use in the store.

There's a lot of tasking that goes on and
in fact it's about fifty fifty

hours that our associates spend tasking
versus customer facing the important

thing that we did was to say
during this period of time.

Don't tax and the reason we did that
is kind of for exactly what your

question suggests which is if you leave
that to every associate to make that

call you know that's my complexity
down rather than simplicity.

It's got to be that every associate
on the floor of our store knows

what we expect of him or
her and that very clear

statement of those hours are only about
cost of our service has actually been

I think of a big plus for us in a number
of respects I would say at the start.

Actually most of our socialist and
think we'd stick to it so

they all thought well that's interesting
but you're going to be telling us to pass

because that's not in our that's just
going to be impossible for us to do.

We've been doing it for a couple of years
now but we're not one hundred percent.

I think it's made it real.

That we've got one up here.

This might not be true but
I feel like I've noticed

that wherever Home Depot's are Bill and
really successful.

It seems like a Lowe's pops
up like within a year or

two it is this true and if so
how do you guys do this.

Knowing competition and
that you're not well we just

make sure their stores next to
ours aren't that's awful but.

You know it is fun on the real
estate not unique to us.

So you know you'll find
you'll find one corner

in a town that has all of the you
know fast food places you'll find.

Another area that I mean
retail particularly for

our stores and
our competitors who copy our format

where we have a very large space for
acquiring and so

you know particularly in
developed areas that are on

development there are just limited number
of spaces where you can get a lemonade for

site for one hundred thousand square foot
store with all the attendant parking.

All right so that's kind of why it happens
is the development all times you know

the zoning people tend to put it all in
the same place and they don't have much.

That's.

Questions in the middle.

We've got one right here and I guess if
you come down on it it's the gentleman.

Yes right.

You turn the microphone on first start.

How much input.

Do you get from your
board of directors and

how much do you listen
to that trick question.

Not just time and
what do you do when you when you

don't feel like some of the directors
are carrying the their weight and

also how do you personally evaluate them.

It's representing the shareholders.

It's a great.

It's a great question.

First we have a great we have
a terrific board of people

and it's a fairly small board.

So we'll only have eight
extra on board members

with myself which which for a company our
size is actually quite a small board.

It is a very I think our whole
order is very proud of the board.

It's a very active board because it's so

small you know kind of everybody
is around every issue.

We ask our board members every quarter
to walk stores with our management team.

So they get both direct involvement
with our management team and

a lot of in-store experience and
you know we have

extensive committees and you know
our board is very actively involved.

So it's a hybrid I don't have
the hypothetical of you know what would

you do if you if your board wasn't
having a lot of value because our

board does add a lot of value and
their suggestions are great suggestions.

I'd also say

that very fortunate to have board members
who understand the role of board.

So they did the biggest thing they do for

me is they'll lift my
head up from the clouds.

So you know it's kind of day to day you
know maybe if I really think a long term

I think in order and they're asking
the questions of three years.

They're asking though where
you can be in seven years.

That's and that's an enormous and
enormous value and

I think from a shareholder perspective.

Again our board and and particularly our
the director body will spend a lot of time

with our with outside shareholders with
our shareholders talking to them about

what their concerns are so that that
you know their issues are pretty well

collective thank you got
a question over there.

OK afternoon don't go measure major
attack with a company like Home Depot.

It's been so
successful here in the United States

because of such things that
the economic system of the efforts.

Structure United States.

Can you talk a little bit below potential
expansion say something America or

China or India and obviously the
infrastructure is still developing those

countries but American companies such
as Home Depot the Wal Marts the world

could realize huge potential for growth.

Yeah I mean it's a great question.

We are in the United States Mexico
care that in China

we have had enormous success in
the United States Mexico and Canada.

Not so much yet in China and
I would tell you.

So we started with about
twelve stores in China.

I think we're now at seven so

kind of going the wrong way but
we're trying to be very intentional

about making sure that our business model
connects with the customer needs there.

So we've had a great
connection in Mexico Mexico

in fact is our most
successful business unit.

It has had positive positive
sales performance for

twenty seven quarter's in a row which
is actually pretty extraordinary

when you think the Mexican economy had the
same kind of pressures the U.S. economy.

We've had terrific success in Canada.

We're number one in Canada and
what I'd say in China is it's less

about the infrastructure because they
have a very sophisticated infrastructure.

It is that the consumer needs
are different so not as many

Obviously single family homes many more
skyscrapers people live in apartments.

What's the role of do it yourself in
my context is a little bit different.

We have some very very
successful stores in China and

we've got to make sure that we can
replicate those across the country.

We have a question way in
the corner over there.

I want to make sure I'm
reaching all the all the.

Spoke it's going to take a second to
get that microphone past their hype.

Mike Miller a grad student here can you
mention any significant changes that you

made from your predecessor I
whether was deserved or not.

Nardelli received a lot of flak for maybe
taking home depot away from its roots and

implementing almost what military
centric to focus on metrics.

Is there something that you've changed or
can you comment on

the direction of course correction
Home Depot has made since zero seven.

You know what I'd say is
probably most the last relevant.

It's not it's not a question of right or
wrong is

basically the decision that we're
retail and the company is on and

I think with a lot of
strategic logic that said

you know we want to do other things
we're going to grow other businesses and

we have very significant
business serving commercial and

industrial businesses we have a number
of different business models.

And we sold those in two thousand and
seven and

just focused on the business and
I think that has.

Come back to this side of the room
a little bit and down here.

Hi A lot of us when we graduate will be
taking more of that entry level positions

and I was wondering if you had any
suggestions of how we can practice or

exhibit leadership skills or
hone those leadership skills and

we don't have a formal
leadership position yet

I know it's a that's a great question.

And here's here here would be
a way to think about it again.

One of the good things about this job
is people give you tons of advice.

It's.
And that's actually really good advice.

So I can pass it on.

So some Somebody said after I got the job
they said you know you really have

to think about leadership in
three different dimensions and

most people think about leadership
is the people who report to them and

they think highly of the people who
work for and you can get that that's

what sort of that's what I was thinking
about and I believe this organization.

So now actually leadership is across three
different dimensions you lead the people

you know that report to you but
you lead your peers and you need

to be intentional by your peers because
it's important to be able lead your peers.

You know kind of get that that's
that's an interesting thought

the third one though was the one
I really hadn't thought about and

said you lead your box
you leave your box now.

And don't tend to think about that but
it was worthwhile for

me thinking about because I've got eight
bosses so you know how do you lead them.

I've got a couple of people here from my
staff who lead me very effectively and

and it is a skill but
what you'd say is look

some people you can go in and say you're
a moron change your mind and other people.

If you did that you're out of a job.

So you've got to go.

What works with this person you
actually have to think about how

do I get this person to do
what you do in your job

you're going to know your job better
than your boss to just start there.

After two weeks you're going to know
your job better than your boss right

then your boss is going to tell you to do
things that you're going to go bone dumb

doesn't make a sense go or do it and

you've got to figure out your job is
figuring out how you communicate that and

how you get your boss going in more power.

Direction and what I'd say is
it sounds interesting and easy.

That's a tough.

That's tough.

And it is leadership.

So all the what I would say is think
intentionally about you know when you're

driving home at night you get some spare
time say Who is this person I work for and

how how do I influence him or what.

What's that influence because he or
she doesn't want to do stupid

things they're just you know they
just don't know that your religion.

My Blackberry just vibrated
twenty times with meeting so

was a patients from various staff
members of the College of Management.

It just keeps going off.

I know what it's about but that is
great advice over here on the left.

Yeah hi.

I believe it's second year M.B.A. and

have you found the servant
leadership works in industry yet

so I'm I'm like I whatever you
call it servant leadership

I believe deeply that it at
Home Depot we call it our inverted

pyramid where the C.E.O.'s at
the bottom and the associates

closest to the customer at the close
to the top of the customers at the top.

It is a it is a profound statement

of how businesses should work and so this
is great because I'm just replaying for

you all the advice I got
when I got this job.

So I'll give you another great
piece of advice that I got that

was a great visual piece of advice and

actually somebody who does a very good
job in the office told me this as well.

So I thought when I got this job that
my job was about making decisions.

I'm the boss and
the more decisions I make the happier.

Everybody is pretty quickly found new you
know what I'm going to be doing that.

Think about the organization.

If you think about the pyramid think about
it is a whole set of interlocking gears.

You know you're going all the way down
until you get to the socials on the floor

said if you think of
your job as I'm going to

spin this Top Gear as much as I can
make great decisions and on the rest

of the organization is going to be
spinning out of control because a little

torque there equals massive torque
through the rest of the organization so

you actually have to be much more gradual
and much more focused than you think

they said more importantly your job
is how does the gear at the bottom.

That is actually interacting
with your customer.

How does the gear the bottom spin.

So it impacts you.

That's the equation solved.

That's why we talk about the inverted
pyramid because in the end at the end

if if you don't structure it so
that the organization is responsive

to what the customers are looking for
you don't succeed and there is no way.

There's just no way for
me to begin to replicate the knowledge

of three hundred thousand
associates in terms of their day.

So the structure of the business again I
think I think of the five years of very

profound organizational principle
that you have to think about and

inverted pyramid Additionally which is
another way of phrasing servant leadership

which is my job is figuring out how I
solve the problems of four thousand three

hundred thousand people that are close to
the customers because they're the ones

fixing the customer problem
questions other questions.

We've got one right here on parking lot.

Fourth year undergrad I was just wondering
if you were talking about making decisions

or at the same time also how
are people make decisions but what

are some of the most challenging decisions
that you've had to make professionally.

Whether that was at G.E. or Home Depot or
even working for President Bush.

So so in truth the decisions
are very different in

the government than in
the private sector and

that's a whole nother that's a whole
nother topic I'd say the most

difficult decisions in
the business world tied back to

the initial comments they were making
they're always about people and

we're all pretty complex folks and there
are people who have enormous strengths

and how do you affectively
leverage those strengths and

stay away from the weaknesses
difficult because you make mistakes

and again I think most people would say
that most of the mistakes you tend to make

tend to be people mistakes where you
just read the capability wrong or

read the ability to adapt wrong and
then there are difficult decisions because

you know everybody's an individual it's
not you know it's it's it's not nice.

I mean they can be great
people they just don't fit.

Take your circle.

For you right here in
the gentleman in the green shirt.

Thanks.
So it's not so uncommon for

a large company to have its corporate
presence concentrated in one location.

But what's unique about the retailer is
that the very core of what it does happens

on the ground level one
is customer facing.

So that being said could you
talk about effectively managing

such a valuable resource in your
store associates when they're very So

geographically spread out and be so
numerous Yeah great question and it.

We spend a lot of time
thinking about communication.

So we spend a lot of
thought process on how we

communicate internally to our associates
so there's kind of two levels of

communication you get how we
could take out to our associates.

What's of importance and
we have actually a lot of tools for

that we have our own little internal T.V.

We have our own internal web site
with blogging and all the rest.

We have little magazines
we send out to us and

we have all watched that folds in
around our internal communication.

So you know that's that's
kind of from Atlanta out

from the field and
we all spend a lot of time in the field.

So we all try to spend a lot of time
talking to our social is meeting with

our associates doing
town halls with them and

then on top of that we have
on a structured sense we have

a meeting every Friday morning
where everybody in Atlanta and

everybody feels it's on the same phone and
not the same phone

same communication system and
talk to the problems of the week.

What's not working well as well as
what we've got to do for the week or

months ahead.

So to try to keep that
two way right over here.

I just have a question when you're

talking about allowing other people in the
company to make decisions and I mean when

we make a decision here at school it's
maybe a grade or something like that when

you allow team member to make a decision
something goes wrong it's just a grade.

Or you know project or

something like that when you allow
someone to make a decision it goes wrong.

I mean that's millions of
dollars jobs livelihoods.

I guess that could go could get
affected how do you deal with I guess

is it just trust in those around you or
training yourself with good people and

how do you deal I guess with
that knowledge that I could have

made that decision and perhaps
something else could have been avoided.

Right.
So

I mean we're not why I mean this is sort
of that back to that little four block or

so the idea is entrepreneurial
spirit with this plan so

we don't people just can't make
a decision that they want.

We have constraints in terms of sort of

the degrees of flexibility that folks have
so you know take the simplest example.

So should the floor of the store can
take care of the cost because for

a product of fifty dollars that's got book

to satisfy the customer as but
it's fifty dollars.

It's not five hundred dollars and
as you go.

This up in terms of what it would cost
to satisfy the customer you got to get

different approval levels it goes up
in the organization the same thing on

merchandising decisions in terms of
buying in because again there are levels.

So it's it is we try to be disciplined
around the entrepreneurial

activity because just exactly as you
said with two thousand stores a decision

can really go back home we do
try to provide some guardrails.

There was a question in the middle
there to the right in the middle.

The man with his hand up in the air.

Yes OK I

see you were talking about.

You have stores in other countries.

How do you establish a consistent
culture within international and

national stores when there is language and
cultural barriers in the other countries.

Yeah that's another great question.

I mean we do have people that go back and
forth in the country.

Again we have our internal
communications so we do hear

each others through the use of
internal T.V. and all the rest.

We do a big event every springtime and

mark where we get all of our store
managers and most of the market and so

we all go someplace and we meet for
three days that does a lot

around the culture kind of celebrating and
laying out the culture of the company as

well as talking about what we could do so
we spend a fair amount of time on that but

I would also tell you you know the
cultures are are a little bit unique to

there are some very common elements in
terms of the raw customer service but

our associates and Canada are a little
different than the U.S. and

around here anything to see any
questions up in the front here.

Thanks again for coming out to Tech today
and great analogies and a quick question.

Last year was settled
with a Michael Powell

twenty five million dollars and I just
want to know what kind of steps are being

taken to prevent this from
happening again which sits

in front of OK so there's

a reference to a great deal saw I think
that's what you're talking about the song.

I think we're actually appealing that.

Salo and so

I'm I have I have the disadvantage
of a legal background and

actually when I was clerking I wrote
a patent that I was a clerk for

the justice who wrote a type of case
that everybody said is ridiculous.

Law.

So I'd say that we're still
that's still under appeal and

yet to be finally resolved but
we're putting the case aside.

We're very very careful.

So I make no comment on that but he ation

we're very careful about what we
do with intellectual property.

Obviously we feel very strongly
about protecting our individual our

intellectual property and
we're careful not to overstep other

people's front.

Thanks for coming in.

What do you feel so passionate about
that when you're engaged in it you're

really energized and
how much of the percent of your time.

Do you get to engage in it so.

So I will I will I will tell you

I will tell you solace things that
are the most fun in this job.

The Probably the most fun thing is and
we've got our head of H.R.

temp rose here in the audience and
when we go around the cities and

towns across the country we have
debtors' with our hourly associates and

we are if you notice in
our stores are you so

sure it's badges for customer service and
then if you get to a certain level you're

a platinum bad winner and
every time I'm going to town.

We have dinner with our platinum badge
winners and that is the single bet.

Saying that's the single
best thing to do because

first off you know I take it.

I take this.

I take one step back and go four years ago

when when I got this job I after I was
referencing other store managers meeting.

I asked our father Bernie Marcus to come
back and talk to our store managers and

he had been back in a while and you
know grown men were crying cheering and

everything is a big advantage to me and
it was interesting the first

thing that he talked about because the
first thing he really emphasized was and I

would have gotten it wrong because I would
have probably said customer service but

the first thing you talked about was the
Home Depot as a source of wealth creation

for itself and the important thing
about these dinners the important thing

about the company is we're a place
where people can come in to work

from any walk of life and
if they're willing to work hard and

five themselves they can
succeed in making great

professional career for themselves and
a great advancement personally and

you see these stories literally literally

every time we do these dinners I can
just you know there's a lot of passion.

So last week I was in I was in Canada with
a group of store managers it was just

great story of one of the store managers
who started out as a lot attendant in

the store and his store manager brought
him in in he was he was just great telling

the story and I could do it just a store
manager very nice and then he says stop.

You've got two choices you can leave.

I can fire him or you're going to go
to another store and take a demotion.

But those are two choices and
the guy goes I you know this

was an unbelievable wakeup call for
me for me it wasn't what I expected.

My wife to just.

Give birth.

You know it was traumatic and
I said OK I'm going to take a risk.

I'll take the demotion and
go to the other school.

He's now running the store
that he got kicked out and

that sense of wow what you can do.

Again just with hard work and
a lot of education is what makes

you know it's what makes the three hundred
thousand the experience of those we have

so so so great and that's the passion of
the business the passion of the business

to see people come in and succeed I'd
say every one of our division presence.

I think started out as
an hourly associate that's and

you love seeing those develop and

I'm going to ask Professor one where
we are for time do we have time for

a few more questions every hour for
nothing.

Right.
But so

why don't more give you sounds good.

Why don't we get one or two more questions
and all right here again up in front

as a student that will soon be looking for
a job I have to ask this question.

I'm in a retail setting where technical
experience is definitely valued.

What kind of emphasis if any is
placed on personal knowledge or

personal experience in the home.

You know I guess people experience
like what kind of emphasis

is put on that hiring associates.

You know it's coming from Georgia Tech.

I mean I would say no
one's going to be going.

Hate can you handle a table saw.

I hope I mean it would be great.

It would be great if you said I love
table saws and you know I love.

I mean but no one's going to expect you to

be a home improvement expert and
don't ask me.

I'm not you know I.

It's don't expect that and
that would be our expectation.

If you want to look like that.

So I'd say.

Generally speaking retail if you
you want to work in a retail or

if if a store environment.

I mean the crate thing about working in a
retailer is the business is so excessive.

So I worked in the business previously
I was talking about you know that made

power quick power turbines.

I could not go in and

sit down with you know mechanical
engineers and say gee you know look

you just rejigger the gas cap flow here I
really think this thing with pork better.

You know you just have no clue.

Anybody can go into our store and go.

Here's what here's what I think you
can do moving here is the experience

because your customers your experience as
a as a customer and you know understand.

And so that I mean it's that sort
of engagement that it's possible.

I mean I think if you look at Kelly
characters here who runs our entire lot of

her team works regularly
in the stores I think it's

part of that experience it makes it
fun to be on that team to get you

a better understanding
of the company is all.

And we have time for one more question and
I just saw him go up right here

up in about the fourth row and
yes on this side right here.

Maybe like one of those options and
I'm asked a question a very good.

First year M.B.A. student and.

One hardened Bernie were running
the company now their Home Depot

is in a much more mature
stage of its life cycle.

So how would you say your strategy your
goals differ from from their goals.

Back when they were expanding business.

So.

Hopefully strategically if
there is deep similarity in

the sense that what's unique
about the Home Depot and

if you read back in the literature
around the one nine hundred ninety S.

as Home Depot is really taking off
this is really the first retailer

that it affected least combined
low price with service.

So you had retailers previously who
did very well on the pricing side

retailers who did very well on
the service side but not both.

So hopefully the underlying
strategy of the business and

what we're trying to achieve in
the business is exactly the same that

economic engine has changed so
if you go back to the eighty's and

ninety's the economic engine was
driven by building new stores.

We have got to focus in the United States
can't Mexico we're not going to be

building off more stores in North America
we do have enormous opportunities to

improve the productivity of those stores
and so the focus is a little different.

It's not so real estate focused
as it as it was before but

hopefully the underlying strategy what
we're trying to do within the stores

the same Very well Mr Blake
this has been truly terrific.

I am so grateful as I know
our students and staff and

faculty are that you took
the time to meet with us.

You share a lot of wisdom that you say
was passed down to you when you took

on this very challenging job but it's
very clear we got a lot of wisdom right

from your brain up there we truly do
appreciate that thank you so much.

Thank

you.
We if we have our

own we have some parting prizes for us.

Well.

So one of those over to you
as well thank you so much.

Thank you very much.

It's really wonderful.