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Home Depot Case Study

Essay by   •  November 20, 2011  •  Case Study  •  2,193 Words (9 Pages)  •  2,414 Views

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Problem Statement

In 2008, the CEO, Frank Blake was implicated for failing to report employee abuse. The allegation indicated tends from forgery, falsifying documents, harassment, and retaliations. Blake was aware of, and in numerous instances, participated in the alleged abuse, cover-ups and retaliatory actions, which involve the stockholders to demand the termination of Blake. His violation of ethics breaches were numerous, deliberate, and so egregious that a person would deem nothing less than immediate termination of all those involve (Blatchford, 2008). A little over a year, Home Depot was sending known sex offenders to be homes to provide a service. They were mishandling hazardous waste, and the declining overall customer service rating did not help the company. The hiring practices were alleged to be unethical, retaliatory, and discriminatory treatment to employees (2008). Managers lied to prospective employees, increased their potential earning and advancement opportunities and then covered up such misdeeds with intimidation and threats of being terminated if the information was revealed. Home Depot has a business code of ethics in place for protection of all staff members affiliated with the corporation. Since the code is in effect all employees/associates, managers, and officers must abide by the code or face severe disciplinary actions, which can lead up to termination. Other executives as well as Francis Blake violated the rights of the employees by not following proper protocol and file the necessary paperwork for the allegations that were reported. With Blake and those under his direction, having full knowledge, blatantly committed numerous acts which repeatedly breached the Home Depot well documented and widely promoted business code of conduct and ethics. (2008).

Company Profile

Home Depot was founded by two people, Bernie Marcus and Arthur Blank, in 1978, along with investment banker Ken Langone and Guru Pat Farrah. Their vision was to create a one stop shopping center for the people who take on a task of completing home projects themselves, this came into fruition in 1979. From the very beginning, Home Depot excelled customer service, providing customers with knowledgeable help with laying tile, changing a fill valve, and handling a power tool. According to the founders, Bernie and Arthur who believed the customer has a bill of rights, this will entitle the customers to the right assortment, quantities and price, along with a trained associate on the sales floor to take of the need of the customer. In addition to this philosophy, the owners also believed that customer service meant 'whatever it takes' to make the customer happy. This emphasizes cultivating a relationship with the customer rather than just trying to complete a transaction. (2008)

The value of Home Depot today still remains in effect and guided by the same philosophy of Bernie and Arthur from 1978. Those values are:

excellent customer service, taking care of people, entrepreneurial spirit, respect for all people, building strong relationships, doing the right thing, giving back to communities, and creating shareholder value. The founders viewed the structure of the company as an inverted pyramid, with stores and customers at the top and senior management on the bottom. Arthur demanded that associates take risks to succeed, saying, "It is your business, your division, your market, your store, your aisle and your customer."

Business Concern

The case filed will implicate numerous members of management, as well as the CEO, Francis Blake. By not filing and reporting the accusations of the employee make the company as a whole look as if they are not willing to practice moral and ethical values, even though it is stated in the business code of conduct and ethics. Each manager that is hierarchy related to the case stands a chance of being terminated from the position. The worker who was fired has been impacted the most, because employment has been terminated. Since the lawsuit was filed and in most cases until a decision is made, the management team will still have income in. I do not understand why employers who have been employed with a company for a long period of time would risk termination for not following protocol and procedures. It seems worthless to try to cover up errors that could be corrected. Once the management team has been infiltrated, the domino effect is passed down to the customers, unintentionally. The team will suffer some frustration until the company is able to replace the people eliminated from the team. The workload will get a little longer and heavier, which will cause stress on the remainder of the employees. Normally when there is tension within an organization, the retaliation is placed upon other employees and the customers. It seems time like these causes the staff to become over-worked and stressed. The fatigue and attitudes are indirectly placed upon the customers. So not only will the management team suffer, the customers will feel the weight of the fallen organization.

Whistle-blowing is a voluntary release of nonpublic information, as a moral protest, by a member or former member of an organization outside the normal channels of communication to an appropriate audience about illegal and immoral conduct in an organization that is opposed in some significant way to the public interest (Boatright, 2009). In this case is there an ethical justification of whistle-blowing? The employee conducted an internal whistle-blowing that was overlooked and altered, apparently to cover up the harassment, threats, and retaliation. Employee conducting an external whistle-blowing is the next step once the internal is overlooked. Even though whistle-blowing can be justified in some cases, it still remains that the courageous employee who performed the valuable public service are often subjected to retaliation (Boatright, 2009). There should be a law of protection, because in some case the employee could really use that protection. In cases like these, the employee can truly be going through some harsh and cruel punishment; and decide to keep quiet because of the retaliation. An employee or former employee should have the right to speak to against the injustice they suffered from working in a hostile environment. One would think if the allegations assessed are not true there should be no retaliation. The accusation should be heard and proven to be true or untrue. If allegations of harassment, threats, and abuse are proven, not only does this affect the management team, it will affect the entire business organization overall. The employment rate can suffer, because new hires



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