Analyzing Consumer Attitudes and the Effectiveness of Cause-Related Marketing

Problem

Does cause-related marketing, as a form of corporate social responsibility, actually benefit a non-profit organization and for-profit business in the win-win approach often touted by corporations?

Background

Corporate social responsibility (CSR) is when businesses merge social and environmental affairs into corporate operations. Relations with stakeholders voluntarily go beyond the legal requirements of complying with society’s expectations in an attempt to enrich stakeholder relationships (Demetriou, Papasolomou, & Vrontis, 2009). CSR existed in Ancient Greece. Citizens expected businesses to “serve the public” and “use their wealth for the greater good” (Eberstadt, 1973). By the 1800’s, social-welfare was no longer viewed favorably as capitalism became the dominant economic form (Eberstadt, 1973). In the early 1980’s CSR began to re-emerge in the business world, and by the 2000’s it was “integrated into the business activities of enterprises around the world” (Demetriou, 2009).

Cause-related marketing is one of many forms of CSR which entails businesses and charities forming an alliance to “market an image or product, for mutual benefit” (Demetriou, 2009). Cause-related marketing (CRM) existed over 2,000 years ago as a donation system within Jewish communities. Farmers donated portions of their crops to destitute individuals in their communities (Yechiam, Barron, Erev, & Erez, 2003). Yet, CRM only began to be considered worthwhile by the business world in 1983 when American Express formed an alliance with the Statue of Liberty/Ellis Island Foundation. American Express agreed to make a donation to the foundation each time consumers used their credit cards. The Ellis Island Foundation ended up receiving $1.7 million from American Express, and American Express’ card usage increased by twenty-eight percent. This success inspired numerous other businesses and non-profit organizations to adopt CRM programs (Demetriou et al., 2009). In 1986, the United States passed a tax act which restricted donations of “appreciated property to charities.” This led businesses to implement new methods of philanthropy, including cause-related marketing.

After the Ellis Island campaign through to 2003, businesses have donated $828 million on CRM campaigns (Morgan & Ryu, 2007). According to Demetriou et al., two-thirds of Americans believe that businesses should practice long-term CRM (2009). A study by Lavack & Kropp (2003) found that consumers in countries with established CRM practices have more positive attitudes towards CRM than countries where it is less established, such as Korea. CRM is prolific in the U.S., Canada, and the U.K. According to Balmond (2003), 83% of consumers in the U.K. have participated in “at least one cause-related marketing programme.” Balmond (2003) also claimed that over two thirds of consumers would like to see more companies become involved in cause-related marketing. CRM is spreading into India, Brazil, China, and South Africa with a positive appeal to customers. However, researchers have pointed out that individual businesses across the globe must carefully analyze their individual consumer bases on cultural levels (Brϕnn & Vrioni, 2001).

A study from the Danish Institute for International Studies claims that cause-related marketing can be divided into three different cause categories: local or proximate causes, distant causes, and global causes. Local or proximate causes are related to the “communities and environments adjacent to the {business’s} sites of operation. Distant causes involve businesses assisting with issues located in places other than their local community, within or outside of the business’s country. Global causes include issues such as climate change, poverty, environmental sustainability, birth control, and breast cancer. These are issues which have effects across the world (Ponte, Richey, & Baab, 2009).
An analysis of the research findings is contained within the Discussion of Findings.

Discussion of Findings

Currently, CRM campaigns have “become an increasingly popular marketing tool” (Kim & Lee, 2009). Consumer purchases are vital to the success of CRM campaigns (Lafferty, Goldsmith, & Hult, 2004). Many consumers expect to receive an increase in utility based on altruistic motivations when they purchase cause-related marketing products. The product may also create a placebo effect or “facilitate self-fulfilling expectations” (Yechiam et al., 2003). Yet, skepticism abounds in consumers’ perceptions of CRM (Kim, 2009). The results of this examination reveal that cause-related marketing is only truly successful when consumers recognize all variables of brand-cause fit, product-category fit, awareness of the cause, and transparency of the business’s donations.

The investigation findings are structured into categories of brand-cause fit, product-category fit, awareness of the cause, and transparency of the business’s donations.

Brand-Cause Fit

Brand-cause fit indicates how consumers’ perceive the matching of the business’s brand name and the non-profit organization’s cause. If the match is not logical then consumers are likely to disregard the cause-brand alliance (Lafferty et al., 2004) or doubt the “authenticity of the partnership” (Chiagouris & Ray, 2007). Brand-cause fit plays a role in consumer evaluation and decision-making from luxury goods to fast-moving-consumer goods. Although, it appears to be more important to consumer purchases of luxury goods since it helps allay the guilt of the frivolous purchase (Hamlin & Wilson, 2004). A study in Alberta, Canada found that businesses that partner with high-fit non-profit organizations may bring in five to ten percent more consumer purchases than they would with a low-fit charity (Pracejus & Olsen, 2003). According to Hamlin & Wilson (2004), who conducted a study in New Zealand, brand-cause fit may actually be the most critical element for cause-related marketing to be successful.

According to Brϕnn, of the Norwegian School of Management, consumer perception of a brand and cause before an alliance is made has an impact on the brand-cause fit. If a brand already has a poor reputation for CSR, linking with a non-profit may or may not enhance their position in consumers’ views of their brand. Typically, the brand must convey to consumers that CSR has become an integral part of their strategy. Otherwise, consumers will doubt the brand’s actual commitment to the cause; in return it will reflect poorly on the non-profit organization as well (Brϕnn & Vrioni, 2001).

A 2008 Brazilian study by Farache, Perks, Wanderly, & de Sousa Filho confirmed that “Corporations should affiliate themselves with a good cause or charity in a long-term partnership. This helps demonstrate a true commitment to the cause or charity.” When businesses are truly dedicated to the cause consumers are less likely to be skeptical of the alliance and are more likely to purchase the CRM products.

CRM is a relatively new phenomenon in China. Yet, a study by Xin Chen found that 74.8% of respondents had made at least one previous purchase of a cause-related product. The study also found that brand-cause fit was a less important factor in Chinese consumers determining to make CRM purchases compared to Canadians. Chen claimed that the collectivist culture of China places a higher priority on community needs. Therefore, the Chinese are more open to CRM campaigns than their Canadian counterparts regardless of brand-cause fit. However, even though brand-cause fit was of less importance to the Chinese than the altruistic nature of CRM it does still play a significant role in the Chinese consumers’ brand choice.

Product-Category Fit

Product-category fit represents whether or not consumers believe that the business’ product and the category of the non-profit organization’s cause are a reasonable affiliation. Consumers should be able to recognize a “complementary relationship between goods and/or services. This is crucial to the success of cause-related marketing (Lafferty et al., 2004). Product-category fit can be difficult for consumers to assess since some causes fall into broader categories, such as human services. It may be difficult for consumers to make a connection between the American Red Cross and canned soup. On the other hand, Avon sells women’s cosmetics and has a cause-brand alliance with Susan G. Komen which is logical due to women’s concerns about breast cancer.

A poor example of product-category fit is the cause-brand alliance between Susan G. Komen and KFC. Hutchison (2010) described the “Buckets for the Cure” campaign as raising a lot of negative attention to the Komen Foundation and KFC. This was due to the fact that the majority of KFC’s products are high-calorie fatty foods, and there is an established connection that digesting these forms of food can increase the risk of breast cancer (Hutchison, 2010). This CRM campaign may be undermining the breast cancer cause, and consumers are less likely to support it. Yet, the campaign raised $2 million in its first week. However, when the donation period ended the Komen Foundation did end the alliance due to the bad publicity (Komen.org)

Awareness of the Cause

Familiarity with the cause may be deemed more important than awareness of the business’s brand. The name of the cause alone may instill positive attitudes towards the product and brand. Familiar brands that forge an alliance with a familiar cause are more likely to be successful (Lafferty et al., 2004). In 1992, Barnes contended that “consumers are more likely to buy cause-related marketing products if they are familiar with the product while familiarity with the charity is less important.” More current research disputes this argument. In 2009, Lafferty and Edmondson performed a study which found that familiarity with the brand had more influence on consumers than familiarity with the cause. The cause they selected had low familiarity. The study exhibited that consumers who are more aware of the cause are more likely to purchase CRM products, whereas, lesser known causes have a lower likely hood of being supported (Lafferty et al., 2009).

According to O’Brien (2004), familiarity with a cause isn’t the only form of cause awareness. Consumers may also have a vested interest in a cause which may increase their chances of purchasing a CRM product associated with that cause. For instance, if a consumer has ever received assistance from American Red Cross in the past or if they know someone who has, the consumer may be more willing to purchase a CRM product from a business aligned with the American Red Cross. This vested interest may be based upon a consumer’s personal values as well. The consumer may simply have faith in the importance or relevance of the cause. Consumer value of a certain cause can be a significant variable in the success of a CRM campaign. That being the case, it is important for the cause-brand alliance to be aware of the values of their consumer base.

Transparency of Business’s Donations

Consumers are often skeptical of CRM campaigns, because donation sizes are stated ambiguously. Barnes (1992) argued that “more information about the dissemination of profits needs to be communicated to allay consumer concerns about the charitable organization realizing their fair share of benefits.”

According to Kim and Lee (2009), donation sizes must be stated in “a verifiable manner” to overcome consumer skepticism. Obfuscating donation sizes are all too common in the world of CRM. Donation claims are often stated as percent-of-profit or percent-of-price. However, many consumers find this format confusing or interpret it differently. They often believe that the business is donating more than they really are or distrust the company actually donating as much as promised. This reduces the objectivity of the claim (Kim et al, 2009).

A study by Webb and Mohr (1998) reflected the attitudes of different consumers on CRM. The majority of consumers were skeptics who had little faith or none in CRM campaigns. One study participant stated, “You show me something that shows exactly what people give and where it goes to” and then they will consider purchasing CRM products. Another participant stated, “I’ll set my suspicions aside ‘cause I think it’s {CRM} good.” As a socially-concerned individual, this participant was a minority in the study who was willing to look past donation transparency to the believed benefits reaped by non-profit organizations.

Due to the recent natural disasters in Japan, many businesses have organized CRM relief efforts. The retailer, Cash For Gold USA, which purchases gold jewelry from consumers has promised to donate 10% of its profits for Japanese relief, and urges Americans and Canadians to cash in their jewelry (Steel, 2011). This donation claim may be considered one of the many ambiguous claims since it does not state if the proceeds are from the retailer’s total profits or profits raised for the relief fund. The U.S. “sushi chain SushiSamba said that through the end of March it will give 100% of the proceeds of a special $12 sushi roll to relief efforts” (Steel, 2011). Yet, these efforts raise another important issue about transparency. Many consumers are not aware of or misunderstand campaign deadlines and donation caps. SushiSamba has provided a dinstinct deadline and clear donation amount while Cash For Gold USA has not. Brϕnn et al. explain that businesses should be open and honest about the results of a campaign as well (2003).

Globally, consumers are concerned about donation transparency. According to a study by Langen, Grebitus, and Hartmann (2010), German consumers desire CRM campaigns to provide transparency through product labeling. CRM has not been very successful in South Africa. Yet, South African consumers have said that exceptionally large donation claims are suspicious leaving them fearful of being exploited. Also, consumers preferred to be given actual-donation-amounts over percentage-of-profit or percentage-of-price donation claims (Human and Terblanche, 2009). In 2008, Farache, Perks, Wanderly, & de Sousa Filho conducted a study which revealed that Brazilian consumers shared the same concerns as South Africans. They also were concerned about confusing voucher schemes, leading to Farache et al. to conclude that CRM voucher programs need to inform consumers as to “how many are necessary for the benefits to be received (2008). Obviously, the majority of consumers are concerned with business donation transparency regardless of consumer nationality.

Finally, the need for donation transparency is necessary since continued consumer skepticism could lead to consumer cynicism of CRM campaigns in general, or policy makers fearful of deception may establish complex regulations. If consumers lose all trust in CRM practices they will no longer purchase CRM products

Conclusion

This examination reveals that for cause-related marketing to be fully successful businesses and non-profit organizations must take into account consumers’ perceptions of brand-cause fit, product-category fit, awareness of the cause, and transparency of the business’s donations. For CRM to be successful consumers must recognize a positive correlation between brand-cause and product-category fits. Consumers must also be familiar with the cause that the cause-brand alliance is promoting products for. Causes with lower consumer familiarity shall not be as successful as causes with high consumer familiarity. Finally, to ensure the successful continuation of cause-related marketing businesses need to provide objective, valid, and verifiable information about donation amounts to reduce consumer skepticism or policy-maker interactions.

Suggestions for Future Research

During the course of this study it was recognized that there is little research concerning cause-related marketing and ethnocentric consumerism. While studies were found which confront the issue of ethnocentric consumers, no studies applied this information to study its affects on cause-related marketing. There is a study by Demetriou, Papasolomous, and Vrontis which concentrated on citizens in Cyprus preferring a more local approach to CSR and CRM. It would be interesting for researchers to delve into this area more and theorize the topic. Are consumers more supportive of CRM campaigns which support local causes, distant causes, or global causes?

It would also be pertinent for researchers to evaluate effects that business’s marketing power has on raising awareness for causes. How much awareness can be derived for lesser known causes through CRM? This is one of the benefits for non-profits which businesses often spout concerning CRM. Yet, minimal research has been conducted on this topic.


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The Relevance and Importance of Organizational Culture to a Business

Henry Mintzberg describes organizational culture as the “soul of the organization-the beliefs and values and how they are manifested. I think of the structure as the skeleton, and as the flesh and blood. And culture is the soul that holds the thing together and gives it life force.” An organization’s culture provides its members with a unique set of values or beliefs. An organizational culture consists of certain features, characteristics, and possible subcultures. In addition, there are four basic types of organizational cultures. Organizational culture also effects members’ motivation and job satisfaction, as well as how conflicts are handled within the organization. Finally, in order for an organization’s culture to be beneficial it must be understood and maintained through appropriate management.

Features of an organizational culture include ceremonies and rituals, stories and myths, heroes, language, and material symbols. Ceremonies and rituals are recurring events that teach organization members about the culture, such as promotions or sales meetings. Stories and myths are narratives about an organization and/or its members. These narratives may include descriptions of the birth of the organization or the achievement of record high sales. Heroes are typically within the company such as leaders or founders of the organization. They typically embody the values of the organization’s culture. Language within the organization embodies the specific jargon or acronyms which the members use. Material symbols may include work attire, or the organization’s logo, and they reflect the culture (Aiman-Smith, 2004).

An organizational culture is comprised of several characteristics which, depending on the organization, may be rated at varying degrees. One characteristic is innovation and risk-taking. Different organizations may or may not place as much value on innovation (Robbins and Langton, 2003). For example, Google prides itself on its innovative culture. Google’s former senior director, Douglas Merrill, once explained that “Innovation doesn’t happen on the way by, it must be designed” into everything that Google does (Farber, 2005). Another characteristic is detail-orientation. Some organizations are more concerned with attention to detail, precision, and analysis than other organizations (Robbins and Langton, 2003). According to Chaneski, Fredon Corporation has been able to build strong, long-term relationships with its customers due to its dedication to detail (2001).

Other characteristics of organizational culture are outcome orientation, people orientation, and team orientation. Outcome orientation involves managers concentrating on results or outcomes rather than on methods used to achieve results. People orientation entails whether or not the managers deem the effects of decision-making outcomes on individuals in the organization to be relevant (Robbins and Langton, 2003). Organizations which have a low or non-existent people orientation typically encounter more cynicism and distrust of management within the system while organizations with high people orientation are more likely to maintain loyal employees (Grinder, 2003). Team orientation may be described as an organization placing more emphasis on teamwork to accomplish work objectives rather than an emphasis on individual work (Robbins and Langton, 2003).

The final characteristics of organizational culture are aggressiveness and stability. An organizational culture that maintains a higher degree of aggressiveness relies on members’ assertiveness and competition, whereas, an organization with a low degree of aggressiveness has a culture which is more relaxed and laidback. Stability encompasses to what degree an organization places significance on activities which either uphold the status quo or initiate growth (Robbins and Langton, 2003).

Companies can have cultures that are very different from one another. There have been many ways that these cultures have been grouped and identified. One of the most common ways to break down these different organizational cultures is by using the four culture types: Hierarchy, Clan, Adhocracy, and Market.

The Hierarchy culture, or Control culture, is defined by stability and control and has integration and internal focus (Tharp, 2009, p. 3). In this type of culture control, standardization, and well-defined structure for authority and decision making are valued (Tharp, 2009, p. 3). The structure makes a formal place to work and smooth running. All the activities are governed by a set of rules and there is very little discretion provided to the staff (Academics at American Jewish University, 2009). Leaders that have been found to be effective in this type of culture have great organizational and coordination skills and are able to monitor people and processes effectively (Tharp, 2009, p. 3). Another culture that is close to that of the Hierarchy is the Clan culture.

The Clan culture, also known as Collaborate culture, encompasses cohesion, morale, and development of human resources (Academics at American Jewish University, 2009). In this culture there are shared values and goals as well as individuality (Academics at American Jewish University, 2009). There is a strong internal focus like that of the Hierarchy culture as well as having values of high flexibility (Tharp, 2009, p. 3). Discretion is also sympathized in contrast from that of the Hierarchy culture (Tharp, 2009, p. 3). This makes a company a friendlier place to work where everyone is open and there is a sense of loyalty. The Adhocracy culture shares some similarities with that of the Clan culture.

The Adhocracy culture, also known as the Create culture, emphasizes flexibility and discretion like the Clan culture (Tharp, 2009, p. 4). However, the focus is external and there is a concern for differentiation (Tharp, 2009, p. 4). They also value adaptability, creativity, entrepreneurship, innovation and prosper in what may be seen as a chaos; this type of culture is what companies like Google have (Tharp, 2009, p. 4). Companies that succeed using this model need to change direction without warning and rely on individual risk taking (Academics at American Jewish University, 2009). In order to effectively manage this type of culture one cannot become stressed in the uncertainty that may arise, instead they need to turn the stress into creativity; also being successful every time should not be the main concern, the main concern should be innovation (Academics at American Jewish University, 2009). Growth and acquiring new resources are the long term emphasis (Tharp, 2009, p. 5).

The Market culture, also known as Compete culture, focuses on goal achievements, market shares, and beating competitors (Academics at American Jewish University, 2009). This culture does not focus on the needs of internal stakeholders; rather it focuses on the needs of constituencies meaning that it has external orientation (Academics at American Jewish University, 2009). Stability and control are valued as well as differentiation over integration (Tharp, 2009, p. 3). Companies that utilize this culture focus on relationships with customers, suppliers, contractors, etc (Tharp, 2009, p. 3). Being competitive and productive through emphasis on positioning and partnership are what Market organizations are concerned with (Tharp, 2009, p. 3). Some of the objectives of these companies are financial results, profitability, and ability to create market niches (Academics at American Jewish University, 2009).

All of the above culture types are differentiated by different beliefs, attitudes, values and behaviors. Different cultures work better for different companies. The different culture types have differing attributes, concerns and methods.

Job satisfaction and motivation play an important role in any type of organization’s culture. A strong organizational culture usually translates into having high employee job satisfaction and motivation to be working for the organization. Having the strong organizational has been shown to increase job satisfaction and motivation greatly. In turn, having the high job satisfaction also leads to having a reduction in turnover rate. This is because employees are satisfied with the job and motivated to work. If this was not the case, employees would be discouraged and looking elsewhere to be employed by an organization with a strong organizational culture.

A strong organizational culture is especially important in nonprofit organizations. This is because in nonprofit organizations, employees need to be reminded what they are exactly working for, what they are committed to, and how they are effective. By reminding the employees that what they are doing is important and necessary and that they share the same goals and values of the organization is extremely important in a nonprofit organization. In nonprofit organizations, the organization’s ability to maintain a steady work force is relied upon its ability to show its employees that what they do is more important than high paying salaries. This is the main reason that most nonprofit organizations have strong cultures, usually stronger cultures than most business. Turnover in the world today, is a serious problem. Employees in the upcoming generation are going to find themselves not just working for the first company they get hired by for the rest of their lives. Instead, the upcoming generation will likely work for four or five different organizations within their lifetime. To solve the issue of turnover, employers must recognize that high job satisfaction is extremely important. People are most likely to join and stick with the organization if they feel that their own personal values are being concentrated on. A foundation with a strong culture will keep its employees because the employees feel that their work is important and that they are working alongside like minded people toward a common goal.

Just as job satisfaction is extremely important to any organizational culture, motivation of the employees is just as important. One of the most widely disputed arguments is, “Does money motivate?”

In recent surveys, it is determined that nonprofit employees come to work for exactly the right reasons. They come to work because they are motivated primarily by the chance to accomplish something worthwhile. Surveys show that employees are more motivated by the feelings they experience at work than by salary. Nonprofit employees know that they have chosen their career paths based on a desire to improve their communities, or society as a whole, not to make money. It is shown that nonprofit employees understand that they can make more money elsewhere.

Most employers believe that when employee’s morale is low, that it is because they are receiving low salaries. A leader who fails to remind his or her employees that the employee is helping the organization meet its mission and improve the lives of less fortunate communities will find that his or her organization has high turnover and low job satisfaction.

Nonprofit organizations are probably the best example of how an organization should motivate their employees. When employees are motivated through values that they believe in and look forward to reaching goals based on those values, everyone wins. The organization will end up with better success and the employee will have greater job satisfaction. As discussed, while most organizations and people believe that employees are purely motivated through money, this could not be more further from the truth. It is shown through nonprofit organizations having some of the most motivated employees in organizations and those employees having high job satisfaction while still earning very little money, that money is not the main motivator. While it may drive some sort of influence on people to get up every day it is not the true reason that employees choose to work where they do.

When conflict arises within an organization it is the result of differing views about how an organization got to where it is, is going and how it should get there, and when views are similar but expectations are different. For conflict to exist it must be perceived by the parties involved. In our culture conflict is sought out and used as an opportunity to grow and learn from certain situations. It is used as to increase knowledge and skill and increase innovation and productivity in the organization. A successful organization needs conflict so that differing views can be offered, and new ways of doing things can be created and used in the future. However, conflict is not always valued in other cultures such as the Korean and Japanese cultures where it is to be avoided ("Role of culture," 2001).

When dealing with conflict within an organization there are three main types. First there is conflict between two individuals which is the interpersonal form. This conflict usually stems from personal dislikes and opinions. Other times differing values can get in the way of work and conflict can arise from this. A technical conflict can also arise between two individuals when a difference of opinion comes about on a task related object in the workplace. Another form of conflict can be seen between an individual and a group. In this case, an individual usually resists the group or does not want to conform to the group. If an individual is seen doing more or less work than the rest of the group a conflict may be started also and someone may be shut out of the group or be looked down upon. In this situation a group member either conforms or quits. A third type on conflict can be seen between the individual themselves when two conflicting views are present. This can be seen when there are two appealing offers or objects. Such as that someone is content and likes their present job but gets another offer and they are then conflicted between the two jobs. Another type of conflict within an individual could be that one thing has both positive and negative aspect to it so it makes it harder to make a decision such as liking a new job opportunity but not liking the new locations ("Organizational culture," 2008).

If a conflict is avoided and not dealt with in the right way it will escalate and the conflict will become bigger than when it began ("Role of culture," 2001). In dealing with a conflict between two individuals, it is very important to first see if these two people can separate the issues from the individuals themselves, and try and work things out for the sake of the organization. If a problem cannot be solved by the people themselves, a source of leadership must step in and try to help. In high power differential countries, such as France and Germany, a source of authority is looked to first to help. It is important that a manager or boss is not the only one who is dealing with the conflict and trying to resolve the conflict alone. It is important that the responsibility is shared and that employees play a role in solving the conflict also. In low power differential cultures, such as our own; a source of mediation is looked to first to help. It is important that mediation is used and authority steps in as little as possible so that it becomes natural and conflict is resolved again in a similar way ("Role of culture," 2001).

Managing culture is a determining factor on whether an organization will be successful. Many new or even existing managers don't know the culture within their organization. Managers have many obligations to fulfill, but one of them should be to find and maintain their organization's culture. As a manager, the first step to find organizational culture is the data collection stage. During data collection managers use a variety of techniques to collect information on an organization's culture and the systems, structures, and processes that support it (“Culture Management,” 2004). To collect data managers conduct interviews, culture surveys, and organizational development surveys. Interviews are with selected employees to help identify the nature of the company's culture (“Culture Management,” 2004). Culture and organizational surveys can be questions a manager feels are relevant to their organization. These surveys help identify the extent to which the company is experiencing problems with respect to its systems, structure, and culture management process (“Culture Management,” 2004).

After the data has been collected, the manager or management team analyzes and synthesizes the data. The data is then used to create a formal report. A manager should form this report to outline the following elements: the organization's real culture, gaps (if any) between the current culture and the culture that management desires for the organization, the organizational systems, structures, and processes that are supporting the current culture and either reinforcing or obstructing the desired culture, and recommendations designed to increase organizational effectiveness and improve management of the desired culture (“Culture Management,” 2004).

As the report is being completed, a manager should be thinking of some type of learning opportunity for the employee's to discuss their thoughts on the organization's culture. One article, “Culture Management”, suggests having a culture workshop. During this workshop, management may assist participants in understanding what culture is, developing an understanding of their organization's culture, creating a statement of their organization's desired culture, and beginning to develop action steps for managing their organization's culture more effectively (“Culture Management,” 2004).

Now that culture has been established within the organization, a manager should easily be able to define culture and what the organization believes culture is. Also, culture management should now be able to determine what the culture is to promote behavior consistent with the company's goals (“Culture Management,” 2004). Lastly, a manager should be able to take an organization from where it is to where it needs to be with respect to its culture (“Culture Management,” 2004).

As the organization grows, how does a manager effectively maintain the culture established? One of the key factors for maintaining business culture is to define the desired organizational culture from the beginning, and integrate it into how employees are hired and treated, the type of customer service provided, and the general environment of the organization (Lieberman, n.d.). To ensure that the culture lasts, managers should develop a strategic plan for implementing culture (Lieberman, n.d.). Also, senior management must implement culture in all they do including: hiring, compensation, rewards and incentives, creating the environment, and marketing (Lieberman, n.d.). As the organization starts to relate to the culture, managers should constantly assess progress and acknowledge their employees.

Organizational culture encompasses the unique values and beliefs of an organization which are reflected in its features and characteristics. There are four basic types of organizational culture which place more or less emphasis on certain characteristics of the culture. A strong and agile organizational culture leads to greater job satisfaction and motivation within members of the culture. The type of culture which an organization has influences how the organization manages internal conflicts. At the same time, managers need to comprehend their organizations’ cultures in order to facilitate change or maintain the current culture depending on which is deemed necessary. An organization’s culture provides the substance and essence for the organization and heavily influences how successful the organization may be since it is inextricably intertwined into all aspects of the organization.

References

Academics at American Jewish University. (2009). Deal and Kennedy’s Four Generic Cultures. Retrieved from http://academics.ajula.edu/Content/ContentUnit.asp? CID=1211&u=3151&t=0

Aiman-Smith, L. (2004). What Do We Know About Developing and Sustaining a Culture of Innovation. Retrieved from http://www.ncsu.edu/cims/downloads/ Research/71_WDWK_culture.pdf

Chaneski, W. S. (2001). Company Emphasizes Quality and Attention to Detail. Retrieved from http://findarticles.com/p/articles/mi_m3101/is_4_74/ai_78840586/

Culture Management. (2004). Retrieved from http://www.mgtsystems.com/products/culture-management.jsp

Farber, D. (2005). A View into Google’s Inner Workings. Retrieved from http://blogs.zdnet.com/BTL/?p=2065

Grinder, D. (2003). People-Oriented Leadership. Retrieved from http://policechiefmagazine.org/magazine/index.cfm?fuseaction=display_arch&article_id=112&issue_id=102003

Lieberman, S. (n.d.). How to Creat and Maintain the Culture of Your Organization as You Grow. Retrieved from http://www.simmalieberman.com/articles/howtocreatemaintain.htm

Organizational conflict - the good, the bad & the ugly. (n.d.). Retrieved from http://work911.com/conflict/carticles/orgcon.htm

Organizational culture. (2008, December 28). Retrieved from http://organizationalclimate.wordpress.com/category/types-of-organizational-conflict/

Role of culture in achieving organizational integrity, and managing conflicts between cultures. (2001, April 29). Retrieved from http://www.ethicaledge.com/quest_5.html

Tharp, Bruce M. (2009, April). Four Organizational Culture Types. Haworth, 1-6.

A Business Management Analysis of Google

Just how good is Google?

Introduction

I have taken on the project of analyzing Google, based on the tenants of planning, organizing, leading, and controlling. Google was founded in 1998 by Larry Page and Sergey Brin. It was incorporated in 2003. Since then Google has become “the most dominant search tool on the web”. Google provides numerous services to its users such as the Google search engine, Google Chrome, Google Translators, Google Books, and Google Earth. Yesterday’s closing price for a share of Google’s stock was worth $593.94. Google is ranked the top internet search engine provider by the American Customer Satisfaction Index. Google has also been ranked the number one employer for the past two years by Forbes magazine. Google has had fairly steady growth since its conception. The main reason for Google’s success is its dedication to innovation. Innovation doesn’t simply occur “on
the way by”, it is designed into everything that Google does (Farber).

Planning

In business, a company can’t just go through, year after year, and just have things happen when they happen. A company has to have a planning system. Companies have to plan for the future. The future can be five minutes from now, a year from now, or five years from now. However, Google understands that in the time it takes to develop a five-year plan their business environment will have already changed since technology advances so rapidly. Google’s planning system is unlike any other company in the world. Google is always looking into the future for their business. Yet, Google’s strategy is one of innovation. Every day, they want to have new ideas for the company so that they can grow. They also are planning ahead to make sure that the company survives the current economic crisis.

Google’s strategy is “deemed emergent as it is created in the implementation process by trial and error” says Joseph D’Cruz, a specialist in strategic management. D’cruz explains that an emergent strategy is one based upon a shared vision that comes from the top and is empowering not only for the company’s leaders, but its employees as well. This empowerment allows for experimentation. According to D’Cruz, Google “learns by doing and learns by making mistakes” (Jensen). For example, a senior software engineer at Google presented a bold idea to Google’s CEO, Eric Schmidt. Schmidt didn’t care if the engineer’s project failed. Schmidt stated, “He’s smart, and he’d learn from it” (Baker).

One way Google provides for experimentation is through providing Googlers with new Google products or services to try out before they are open to the public. They have them try it out so that the employees can give feedback on the product. The feedback is priceless information on a test run for their product. It helps them plan for the problems that they will have to deal with when the product is public. A tool that helps them communicate their opinions about those products, along with other planning is their blog system. “Google has an in-house blogging tool that allows employees to start their own blogs. Employees can use these blogs to communicate personal stories, to provide work updates, or to share notes”.

Google also experiments through utilizing user-based experiences with new programs to ascertain if a new product is viable. Google Experimental Search is a program that allows users to actively join one of Google’s experiments so that users can rate how useful a new service may be. This allows Google’s consumers to actively participate in a service for free to see if it suits their needs. One of Google’s current experiments is My Preferred Sites. Users are able to inform Google of their favorite websites. Then whenever a user uses the Google search engine their favorite sites are always indicated on the search results page. This is just one example of the several experiments that Google is currently working on.

A major part of the planning system is the Google employees. It is extremely hard to become an employee at Google, and for good reason. Google makes sure the people hired are the best at what they do, because they put so much trust in them. One major part that employees take part in the planning system is the “Whiteboard”. Google realized that some people might not speak up with ideas if you have to do it publicly. This philosophy is basically a way to have the employees give opinions or ideas without having to get up in front of bunch of people just to give an idea. They give the workers a chance to write a new idea down that might help the company. They also can add on to others’ ideas to help products that are already available to the public, or just how to improve life at Google. These different ideas are all looked and maybe one will be the starting plans of a new product or service for the company. These huge whiteboards can be found all over Google.

It is often said that Google is run “chaotically”. This is true to a certain extent. Google does not have a specific formal plan for how to get a job done. Google’s leaders set objectives. Then they turn teams of Googlers lose on projects. Google allows its Googlers to use their own creativity to achieve company goals (Caplan). That’s where the chaos ends. Google exerts great care into being thorough in its financial plans. The financials for cash flow and such are modeled. When it comes to financial planning Google looks three years into the future. Google’s strategic plan looks ahead by one year considering which new markets Google wishes to enter (Caplan).

Google is always planning for the future and trying to grow into different markets. They are never happy with just where they are in the business world, even though they are on top. They are thinking and planning on new things every day. In the search engine market there is not much more room for Google to grow. They have to really expand into different sections. There are three big plans for Google in the next year to help grow as a company. In the first half of 2010 Google has announced that they will be starting their own eBooks store called “Google Edition”. “Google Edition” is different from the Google book search that they have now. There still will be the ability to preview up to 20% of the book. But “Google Edition” is going to be almost exactly the same setup as the popular Amazon.com (making them a direct competitor). They are also planning on putting out their own Smartphone like the iPhone. In fact, Google’s phone, Android, is starting to be called the “iPhone killer”. Again this gives Google another direct competitor. Lastly, Google has been investing in satellites since 2005. They understand that “traffic on Google websites depends on internet infrastructure development and availability”. Through infrastructure investments, Google reinforces its traffic providers and increases access to its services”. All three are great examples of how Google is planning for the future and working to expand.

Google has also made plans for dealing with the recession. The recession has taken a toll on a lot of companies in the United States. Google didn’t want to be a company that would be a part of that trend. They had to plan and find a way to get through it, which they did. In Google’s plan to survive the recession they decided to eliminate about 1% of their workforce. To attempt to keep revenues up Google had a new idea. “Since around November 2008, Google started experimenting with their AdWords listings by placing them across Google Image Search, Google Finance and Youtube.com. Now they’ve taken this experiment one step further by placing ads across Google News as well. In a move to secure their advertising revenue in tough economic times, Google have introduced AdWords ads across another web property, Google News. While Google earns most of its revenue from search advertising, placing ads across additional sites helps to boost revenue from other areas which may be falling in the current economic climate.” Overall, Google has not been affected by the recession like most companies.

Google is an extremely unique company in general, and their planning system is just as unique. Some companies are comfortable with staying in the same market that they started in and not wanting to grow. Some companies only want to think about what is going on with them now and not on the future. Google is different than these companies and it is not a coincidence that they are successful. Google cares about their employees’ plans on how to improve the company more than any other company I know of. A lot of companies didn’t plan what to do with this recession, but Google made sure that their success will continue even after the economic crisis. The best part about the planning system that Google shows is the non-stop care about the future. Always asking, “What’s next?”. Always wanting to expand and improve. They plan and find ways to find new sections where they can achieve those goals. People always said that Google might take over the world someday and who knows, that just might be in their plans.

Organizing

Google operates as a learning organization. Google’s organization has developed the “capacity to continuously adapt and change because all members take an active role in identifying and resolving work-related issues” (Robbins 148). Google’s employees are always touching on new horizons and learning as they go. There are several factors involved in Google’s design as a learning organization. These include Google’s organizational design, information sharing, leadership, and organizational culture.

Google’s organizational design is boundaryless. The hierarchy within Google is flattened. “The tech ladder is far more valued than the management ladder”, according to Douglas Merrill, the former senior director of information technology at Google. Google gives more value to “geek talent”, and is more dependent upon multidisciplinary work teams than inter-organizational barriers like managers (Farber). The flat or horizontal design of Google’s organization is also evident in the “approachability of its senior employees” (Perle). At Google, there is no fear of upper management, everyone is happy to share ideas. On top of this, Google does not separate employees with physical boundaries like cubicles. Instead, Google offices are decorated with arrangements of couches and white boards, and desks arranged in “cubes” (Perle).

Google utilizes a Project Database which is like a reporting system for Google employees. It allows Googlers to keep track of what they and their co-workers are working on through email postings. Merrill explains, “It creates public data, for all to see and come up to speed on projects, and maximize [sic] the opportunity for accidental cross-organizational pollination”. Google’s Project Database helps allow for Google’s boundaryless design by allowing for information sharing, and team communication.

Google’s leadership provides Googlers with a shared vision of “organizing the world’s information and making it universally accessible and useful”. Google’s leaders also impart the Google philosophies of speed, accuracy, democracy, and excellence. Through the facilitation of Project Database, Google’s leaders are able to “support and encourage the collaborative environment that’s critical to learning” (Robbins 148). Google thrives on innovation and the free-flow of ideas, and Google’s leaders are always open to and encouraging of creativity from employees.

Finally, Google’s organizational culture provides a backdrop for its learning organization. Google works to build strong mutual relationships between Googlers. Google sponsors annual parties for employees to get to know each other better and have fun, as well as a summer picnic for Googlers and their families to mingle and converse. Google is concerned about its employees and wants them to have a shared sense of community within Google. Google demonstrates how much it cares for its employees through the numerous perks which it provides for its Googlers. The aforementioned have aided Google in building a basis of trust with employees. Many Googlers have developed such loyalty for Google that they consider the Google management and their fellow Googlers as family (Hernandez).

As part of the organization, Google’s human resources or “People Operations” are left with the duty of selecting candidates for hire. Google has wined and dined university students, and sponsored technology lectures, programming contests, and “hack days” to find new recruits (Helft). Laszlo Bock, Vice President of People Operations, maintains a deadline for human resource staff to interview candidates and submit comments (Bock). Also, Google has created its own algorithm based on questionnaire data received from potential hires to rate from 0-100 how good a fit a candidate is for Google (Bock). On top of that, Google utilizes an application tracking system which coordinates interview information and comments from employees. A committee of people will assess all the information and decide on the new-hires, not the hiring manager (Farber).

Google strives to find employees who are a good fit for its culture. At the same time, Google endeavors to keep it employees, maintaining a minimal employee turn-over rate. Google does not release salary information. However, Google supplements base salaries with stock options, vacation days, flexible hours, and exceptional health care. Employee performance is based on a 360-degree appraisal. Team members provide feedback on each other through an open and transparent forum as a mode of performance management. Ultimately, Googlers are more concerned with what their co-workers think of them and managers are devalued (Farber).

Google’s environment is one of constant change and innovation. Google likes to keep its Googlers challenged. Google achieves this by moving people from project to project to keep their think tanks operating. An average project at Google lasts about three months and then employees are moved to different projects with different team members. To help Googlers deal with the continuous change there is Project Database (Farber). Also, if Googlers become stressed, Google offers onsite massage therapy, a gymnasium, hair stylists, and fitness classes to help employees unwind and relax (Google.com).

Leading

According to the textbook Fundamentals of management, leading includes “motivating employees, directing the activities of others, selecting the most effective communication channel, and resolving conflicts”. Bill George professor of management at Harvard business school claims meaning is about “internal development and introspection”. In this paper I will illustrate the different ways Google tries to embody all these principles of leadership.

According to Michael Lee Stallard, a consultant on leadership and management, the single factor that predicts the rise and fall of an organization is “the force of connection”. Michael claims that “connection is like gravity, in the absence of gravity objects float apart. With connection they pull together. They’re more aligned with each other and the organizations goal” Connection has four elements; vision, voice, value, and meaning. These elements are all crucial for leaders to instill into their employees in order to ensure the success of a company. The first aspect of connections I will talk about is vision.

According to Stallard, vision exists when "everyone in an organization is motivated by the mission, united by the values, and proud of the reputation. The question one might ask when deciding a company’s vision is what are the company’s core principles that help motivate and inspire employees? When employees can relate to and connect with the vision it helps motivate employees by allowing them to be pound members of their company. Google’s “don’t be evil” motto is just one aspect of Google’s overall principled vision. According to Google, the phrase “don’t be evil” is intended to be “built around the recognition that everything we do in connection with our work at Google will be, and should be, measured against the highest possible standards of ethical business conduct. We set the bar that high for practical as well as aspirational reasons: Our commitment to the highest standards helps us hire great people, who then build great products, which in turn attract loyal users.” This vision helps reinforce in the employees that they are working for an ethical, principled organization. The employees can be proud of what they do, and when they are proud of what they do they are happy to work for the organization. Not only that, but customers can be proud to use a product from an organization with principle. This is why it is important for leaders to instill a principled vision for an organization.

The second aspect of connection is value. Value occurs when a company understands the needs of the average person. It means the company strives to help people reach their full potential and that they appreciate their positive contributions. On Google Jobs, Google lists reasons to work for them. Reason number three has to do with appreciation. Google goes on to say. “Appreciation is the best motivation, so we’ve created a fun and inspiring workspace you’ll be glad to be a part of, including on-site doctor and dentist; massage and yoga; professional development opportunities; shoreline running trails; and plenty of snacks to get you through the day.” Essentially value means meeting needs beyond work. Google leaders accomplish this by providing employees with running trailers, massages, yoga, doctors, and dentists. When employees understand that a company cares about more than just their performance as an employee, an employee can feel attached to the company in a positive way. They will not so much see work as just work but as an extension of their everyday life. When leaders instill value in their customers their employees’ morale and happiness goes up, thus employee morale and performance improves.

The third element of connection is voice. Essentially voice is when everyone in an organization is able to exchange healthy ideas and opinions with others in an organization. Think about it this way, would you be more invested in a company that implemented your ideas and concerns into their company policy or one that had no desire to hear out the opinions of the company’s workers. When an employee has a voice in a company, they can feel truly a part of a company. When they feel a part of a company they can feel like what they do matters, and thus, have motivation for what they do. They work through the company and the company works through them. Furthermore when an employee has an adequate voice, a company can gather valuable insight into what needs to be done in a company. Sometimes the employees have the best insights into how to improve efficiency, employee morale, and other things. This is why it is important for leaders to ensure their employees have an adequate voice.

The last aspect of connection is the need for meaning. A person is more likely to thrive and put more effort into their job when they feel what they are doing is meaningful to them. In a way meaning encapsulates many of the previous concepts. I mentioned before that when an employee has a voice an employee can feel connected to the company in a meaningful way. When employees know that their views matter, they feel a part of the company, and when they feel a part of a company they know that what they do matters, when what they do matters they care about their company.
Stallard even justifies connections importance in leadership from a biochemical perspective, “The importance of connection in leadership can be summed up by making an employee feel genuinely connected to a company, almost like an extension of their family. When a company successfully this employee morale and thus employee performance goes up. From neuroscience, we learned that these feelings of connection boost hormones in our bloodstream that make us feel more energetic, more confident and more trusting others. Connection also reduces the levels of stress hormones in our bodies so we are more likely to be rational rather than rash when we are under stress”. In the end, when leaders motivate and inspire their employees by using the four tenants of connection; vision, value, voice, and meaning, leaders can establish a successful company.

Controlling

As defined by the Merriam Webster dictionary, control means “to exercise restraining or directing influence over: regulate b: to have power over: rule c: to reduce the incidence or severity of especially to innocuous levels”^[1]. In business however, there must be a balance between the dictionary definition of control and letting employees be able to make their own decisions. Google has an excellent way of governing their employees while still allowing them to be free to come up with the ideas that make Google what it is as a company.
The Google Code of Conduct is something that every employee at Google is required to abide by - from the newest entry level intern, the employees in its overseas offices, all the way up to its CEOs, and even the members of their Board of Directors. It was last updated in April 2009 and begins with the simple phrase - “Don’t be evil,” then has seven sections which seem like they would be common sense to the average person: (I) Serve Our Users, (II) Respect Each Other, (III) Avoid Conflicts of Interest, (IV) Preserve Confidentiality, (V) Protect Google’s Assets, (VI) Ensure Financial Integrity and Responsibility, (VII) Obey the Law; and concludes with who to contact if they have questions about the Code and who to contact if they see someone breaking the Code. Unlike many companies where a code of conduct might be written in difficult to understand legalese, the Google Code of Conduct is written in plain English. Each section has detailed guidelines and gives the employees direction not only on what to do in a situation, but also which departments or which people to contact if they need approval for something, or if something is unclear.

Because of the way Google is set up as a team effort, as opposed to the traditional “do as I say, not as I do” type of leadership, Google has been able to retain many of its employees, especially in the executive levels. One example is David Drummond.^[2] Drummond was first introduced to the company in 1998 when he worked with Page & Brin to initially incorporate the company as Google’s original outside legal counsel through the law firm Wilson Sonsini Goodrich and Rosati. In 2002 he was offered and accepted a position as the VP of Corporate Development with the company. Since then he has been promoted to his current position of Senior VP of Corporate Development, and also serves as Google’s Chief Legal Officer.

“Control” in a business setting can also refer to their earnings. A company which has stable earnings and growth can almost always be considered to be in control. As of the end of the third quarter of 2009, Google has increased their revenues by 8% since the first quarter of 2008, according to a graph in their quarterly earnings summary for the third quarter^[3]. According to the financial data on the graph, in the first quarter of 2008 the company earned $3.4 million from Google.com, $1.7 million from their network, and $5.2 million from licensing and other ways of income. During the third quarter of 2009, Google was able to increase earnings to $3.9 million from Google.com, $1.8 million from the network, and $5.9 million from licensing and other sources of income.

Earnings are expected to increase even more in 2010 due to the release of their internet browser, Google Chrome and their new web-based operating system also named Google Chrome. Another factor which may assist in the increase of Google’s earnings is the mobile phone operating system, Android, which is currently available on several different carriers through several different mobile phone manufacturers. The most well-known and heavily advertised of these is the Motorola Droid, available through Verizon Wireless, and the HTC my-Touch which is available through T-Mobile.

When looking at a company for a good example of control in a business sense, Google is in the top tier. Google allows their employees the ability to work and develop ideas freely, while maintaining control through the Google Code of Conduct, and made that so anyone could understand it. They not only have a culture that inspires people to want to come work for the company, but also make it so once people are there, they don’t want to leave for whatever reasons, whether it’s because of the “everyone is equal” culture or the benefits provided by the company and discussed elsewhere. Google also exhibits control through their earnings which are continuing to do well, despite a weakened economy. They are able to do this through three ways, with the most income coming from licensing of the Google name and development of things people can and ultimately use every day.

Conclusion

Google is an innovative company from the products and services it provides to the planning strategies it utilizes, from its organizational structure to its unique organizational culture, from its shared vision in leadership to its growth and control. It is no wonder that Google is number one in the eyes of its consumers and its employees. Google’s innovation and creativity have helped Google continuously grow in value. It will be interesting to see how Google continues to adapt to the ever changing business-world, and as Google continues to grow if it will be forced to take on a less “chaotic” format.

This analysis is now somewhat dated. I shall be undertaking a new analysis soon which will compare this analysis to Google's current business conditions in the market.

Works Cited
http://www.uschamber.com/bclc/profiles/google.htm
http://www.google.com/intl/en/jobs/
http://blog.ineedhits.com/search-news/googles-recession-plan-put-ads-on-everything-03042991.html
http://www.scribd.com/doc/13286610/Strategic-HR-Planning-at-Google-Inc
http://www.slideshare.net/misteroo/all-about-google-presentations
http://blogs.computerworld.com/google_shares_earnings_profit_revenue
http://www.google.com/intl/en/corporate/
http://money.cnn.com/galleries/2008/fortune/0801/gallery.bestcos_top50.fortune/index.html
Baker, Stephen. “Google and the Wisdom of Clouds”. Business Week.com (2007).
http://www.msnbc.msn.com/id/22261846/
Bock, Wally. “Google Is As Google does”. Wally Bock’s Three-Star Leadership Blog. (2007).
http://blog.threestarleadership.com/2007/06/04/google-is-as-google-does.aspx
Caplan, Jerry. “Google’s Chief Looks Ahead”. Time. (2006).
Farber, Dan. “A View into Google’s Inner Workings”. ZDNet. (2005).
http://blogs.zdnet.com/BTL/?p=2065
Helft, Miguel. “In Fierce Competition, Google Finds Novel Ways to Feed Hiring Machine”. New York Times. (2007). http://www.nytimes.com/2007/05/28/technology/28recruit.html?pagewanted=1&_r=2
Hummer, Brent. “Google Strategic Plan”. Daily Speculations. (2006).
http://www.dailyspeculations.com/google-paper-ellison.html
Jensen, Camille. “Forget Long-term Planning, Adopt Google’s Approach to Strategy, Says Expert”. Axiom News. (2009).
http://www.axiomnews.ca/NewsArchives/2009/October/October30.html
Perle, Elizabeth. “There’s Something About Google”. The McGill Tribune. (2007).
http://media.www.mcgilltribune.com/media/storage/paper234/news/2007/11/13/Features/T heres.Something.About.Google-3095885.shtml#4
Robbins, S., DeCenzo, D. Fundamentals of Management. Upper Saddle River, New Jersey: Pearson Prentice Hall, 2008. Print.
^1]http://www.merriam-webster.com/dictionary/control
^[2] http://www.google.com/intl/en/corporate/execs.html#david
^[3]http://docs.google.com/present/view?id=djnx46b_113gknm2bcn

Analysis of an Intercultural Manager's Mindset

What Does it Take to be an International Manager?

Obviously, anyone aspiring to be an international manager should concentrate on the core business studies like economics, finance, and management. It is also important to remain well versed in the constant inflow of new studies and current events. Yet, I believe that this information can only take a person so far in global business or life. The basis for an international manager’s mindset should be awareness, understanding, and acceptance, but not necessarily in that order.

Managers should be aware of who they are as individuals, what they value, and where those values come from. Yet, what are the sources of those values? People learn their values from their families and communities, the surrounding social structure; culture. Yet, what influences culture? Paul Tillich wrote that “Religion is the substance of culture; culture is the form of religion.” Culture and religion are inextricably intertwined. Religion provides culture with patterns of belief, morals, values, and codes of conduct. Religion and culture provide people with a method for interpreting and understanding the world. They have a strong influence on individuals’ perceptions. An aspiring manager must analyze their own belief structures and how they decide what they value and deem right or wrong. Only then can they truly be aware of the differences between themselves and others. No one can know someone else if they do not know themself.

I think it is important for the manager to gain an understanding of the culture/s of the people they will be working with. While cultural profiles may be useful for this, I think that they may be to a certain extent over-generalized and stereotypical. Rather than learning the basic characteristics of a given culture, I think a manager should immerse themself in that culture. One way would be by reading that culture’s literature, since literature is a reflection of culture. It could be as simple as reading the mythology or folk lore of that culture. Myths personify the morals and ideals of culture and religion. Yet, a reader must be careful not to interpret such things through a myopic lens.

Managers must be able to accept and respect cultural differences. Instead of assuming that their way is best or being ethnocentric, managers should accept that individuals from other cultures have their own way of doing things. Managers should be respectful of this. Yet, at the same time, managers should not sacrifice their own values. Instead, managers should help the people from other cultures develop an understanding as well which will make compromise and negotiations much simpler.

Developing awareness can help a manager develop cultural empathy. It can also aid them in thinking “outside the box”. Understanding and acceptance can be the building blocks of respectful intercultural relationships. Also, understanding a culture can make it easier to adapt to, and adaptability is necessary for an international manager.

Finally, strong communication skills are vital for an international manager. Yet, I think it may be one of the most difficult skills to develop. Miscommunications often occur even among people who are well versed in the same language and from the same culture. Managers who are aware of what they are saying and conscious of misunderstandings which may occur from speaking in metaphors or idioms will avoid such things.

An Analysis of the United Parcel Service

The United Parcel Service (UPS) has with stood the test of time.  The company started as a $100 dream and has grown to a global industry with brand recognition throughout the world (Garvin & Levesque, 2006).  All companies have a goal of doing just this, evolving with technology and paving the way for future firms in your industry.  However, the tale of UPS can do more than just aid those in the same industry, the strategy and strengths of UPS are those to be analyzed and made applicable to any industry today. 

Strategy has never been taken lightly for UPS.  Monthly meetings of teams specifically formed to envision the future and assess decisions have always played a large role in UPS’s approach to low cost management and differentiation through quality customer service (Garvin & Levesque, 2006).  The combination of these approaches creates a generic business-level strategy emphasizing quality as reliability.  By identifying their position on the value creation frontier, the objectives of a company can become more clearly defined (Hill & Jones, 2010).  It is through such identification that has led UPS to change their mission statement, further identifying goals and purposes at the organization in their industry and market segments (Garvin & Levesque, 2006).

As a company that focuses on low cost and quality, it is important for UPS to take critical action towards each of these approaches to differentiation.  These actions have transpired into tangible and non-tangible potential outcomes for the company (Garvin & Levesque, 2006).  The company has created their own sets of terms and norms by allowing their company to adapt to customer needs while staying within the same parameters outlined by the company.  UPS is able to stay ahead of the competition by constantly looking into the future.  By knowing where they want to be in the future, the managers are able to see if each investment, functional-level strategy, business-level strategy, or technological advancement will help or hurt the company (Garvin & Levesque, 2006).  UPS tries to take advantage of all potential technological advancements, staying true to the heritage of the company (Associated Press, 2010). 

UPS stays prominent in their market by focusing on three major areas of need. The business operates as: a United States domestic package service, an international package delivering service, and a supply chain and freight service (Associated Press, 2010).  UPS takes what many companies would consider to be extremes in order to cut costs and become more efficient.  UPS trucks do not take left hand turns, for one.  It has reportedly saved them 20.4 million miles by having an expert map out their routes before the delivery occurs.  This simple approach has also had a more environmentally friendly effect, reducing their carbon footprint 20,000 metric tons (Shontell, 2010).  Senior Vice President Ben Stoffel also informed the public on CNN Money in 2010 that it is safer and quicker to make a right handed turn (Shontell, 2010).  An employee of UPS told my management 310 class that when he worked for UPS there were expectations on how drivers would enter and exit the trucks.  By having a specific foot you would step into the truck with it saved time and gave UPS another advantage in the field of low cost strategy.

UPS has dedicated their decision process and strategy to low cost and quality through efficiency and reliability of service (Garvin & Levesque, 2006).  They do so by focusing on the importance of pricing options, differentiation, finding the market demand, having a very specific cost structure, and focusing on their particular industry and market competitive structure, which are all important in a successful position at the business level (Hill & Jones, 2010).  By identifying their strategy and staying fully committed to it, UPS’s actions and strategy is one of great value.  This value is exponential due to the fact that UPS is in a very competitive market.  The services offered by UPS are comparable to those of FedEx and DHL.

UPS has become a pioneer in the industry by staying ahead of the game technologically.  The company needs to continue to find ways to ship products efficiently and cost effectively.  It is important for UPS to find new segments in the market in order to keep making a profit.  UPS also needs to continue to understand the importance of international business and their role in this growing industry.  Many businesses are spread across the world and rely on services from UPS and their competitors to do business in a timely, cost effective manner.  The future plans and strategy of UPS are important, but so is the past.  UPS focuses a tremendous amount of time and effort into the future.  Learning from mistakes and short-comings are also very advantageous.  UPS is ahead in their industry, but they do need to keep a close eye on mistakes of competition as well as the successes those companies have had. 

UPS had the largest initial public offering (Garvin & Levesque, 2006).  The company still boasts a high stock price.  According to Yahoo! Finance the stock for UPS closed at $65:57.  The company has had stock prices over $70 this year, and its low as remained about $60.  The company is optimistic in this trying economy.  UPS predicts that this fiscal year that their returns will be $4.15 to $4.40 per stock.  This is up three cents from the original predictions by the company.  Their focus on efficiency and low-cost looks as though it may really pay off in the future for their investors even as oil prices stay high (Bomkamp, 2011). 

Works Cited

Associated Press. (2010, May 26).  United parcel service inc. ups:nyse, industrials/air freight & courier services.  Retrieved from http://topics.nytimes.com/top/news/business/companies/united_parcel_service_inc/index.html

Bomkamp, Samantha (2011, April 26). Ups raises outlook while eyeing economic risk. Retrieved from

http://finance.yahoo.com/news/UPS-raises-outlook-while-apf-885984253.html?x=0

Garvin, David A., Levesque, Lynne C. (2006, June 19). Strategic planning at united parcel service Retrieved from

http://cb.hbsp.harvard.edu/cb/web/he/product_view.seam?R=306002-PDF-ENG&T=EDC&C=PURCHASED_MATERIALS&CD=10137534&CS=9b0458117dabf501e702e9b9f7826bc7

Hill, Charles W.L., Jones, Gareth R. (2008). Strategic management: an integrated approach. Mason, OH: South-Western Cengage Learning

Shontell, Alyson. (2010, March 24). Why ups is so efficient “our trucks never turn left.” Retrieved from

 http://www.businessinsider.com/ups-efficiency-secret-our-trucks-never-turn-left-2011-3

Yahoo!Finance (2011, October 31). HTC Corp..

Home Depot Inc. Management and Industry Analysis

Introduction

Home Depot, Inc. (HD) is a home improvement retailer that provides consumers with home improvement and lawn care products, building materials, equipment rental, and installation services.  The Home Depot, Inc. was established in 1978, and it is operated out of Atlanta, Georgia (Yahoo Finance). The initiation of the 2008 economic recession and the crash of the housing bubble had an adverse effect on the entire home improvement retailing industry, as well as Home Depot’s sales.  However, the organization has been able to make a strong recovery, and is the world’s largest home improvement retailer.

Home Improvement Retailing Industry

            The home improvement retailing industry consists of large home centers and hardware stores that may provide products and services.  According to Charles Hill and Gareth Jones’, Strategic Management: An integrated approach, Porter’s model for analyzing an industry consists of five components.  These are the risk of entry by potential competitors, the bargaining power of buyers, the bargaining power of suppliers, the threat of substitutes, and the amount of rivalry between established firms in the industry.

            In the home improvement retailing industry the risk of entry by potential competitors is a low force.  The top two companies in the U.S. home improvement retailing industry are The Home Depot and Lowe’s (Hoover’s Inc., 2011).  These companies have established economies of scale through centralized purchasing.  Home Depot and Lowe’s also have strong brand names and each provide specific brand-name products that have established consumer loyalty.  Customer switching costs should not be a major issue in this industry due to the low-cost prices offered by the main competitors in the industry.  The top firms in the industry have absolute cost advantages based on their accrual of experience, supplier relationships, and ease of access to capital (Hoover’s, 2011).  Consequently, the risk of new entrants in the industry is low.

            Rivalry in the home improvement retailing industry is strong.  The industry is dominated by Home Depot and Lowe’s, but it is fragmented due to the high number of competitors and the vast variety of products and services (Sunita, 2010).  Competitors in the industry include electrical, plumbing, and building supply stores.  Other competitors are specialty design stores, discount stores, independent building supply stores, and even other retailers such as Wal-Mart and Sears (Home Depot, 2011). Industry demand is predicted to increase as the large Generation Y enters into the housing market and begins spending on do-it-yourself home projects.  Also, demand is currently increasing as homeowners begin home-improvements which were set aside during the economic slump and the bursting of the housing market bubble.  The increase in demand should moderate the strength of competition in the industry.  However, the industry maintains high fixed costs for capital leases, buildings, land, and employee salaries which heightens the rivalry among competitors for the greatest sales volume (Joint Center for Housing Studies, 2011).  Therefore, rivalry in this industry is strong.

            The threat of substitutes in the home improvement retailing industry may be considered low.  The products and services provided really are not ones that have any close substitutions.  While tea may be considered a substitute for coffee, there is no close substitute for paint, drywall, or other home improvement supplies or services.  The only product which may really be considered a substitute would be a new house.  A substitute for services provided would be more customers choosing to perform their own installations of products by educating themselves on the necessary procedures (Sunita, 2010).  In spite of this, these consumers will most likely still make their product purchases within the industry.  Hence, the threat of substitutes is a low force.

            The bargaining power of suppliers is a low force in the home improvement retailing industry.  Companies such as Home Depot and Lowe’s depend upon products from well-recognized brand-name suppliers.  If these firms are unable to maintain their strategic alliances and exclusive relationships with certain suppliers they might lose their product differentiation which attracts some customers.  In addition, these companies have some reliance upon third-party suppliers.  If these third-party suppliers were to run into financial or regulatory difficulties or for some reason be unable to uphold their side of an agreement there would be a negative impact on the companies in the industry. However, these firms maintain the majority of control over their own supply chains by eliminating the middlemen such as distribution centers.  Also, as a leader in the industry, Home Depot has an online center, workshops, and scorecards for suppliers.  This aids Home Depot in minimizing the control of its suppliers (The Home Depot, 2011).  Lowe’s also utilizes a supplier website for building and strengthening supplier relations (Lowe’s, 2011).  These activities limit supplier bargaining power to a low force.

            The bargaining power of buyers or consumers is a strong force.  There are three types of consumers for the home improvement retailing industry.  There are the do-it-yourself customers, buy-it-yourself customers, and professional contractors.  The number of competitors in the industry is relatively high granting greater bargaining power to the buyers.  Consumer tastes, preferences, and expectations influence consumers’ demands for products and services (The Home Depot, 2011).  This in turn increases the bargaining power of buyers.  Yet, as long as the industry is able to anticipate and properly respond, consumers will have a lower bargaining force.  In turn, this is why businesses in the industry place such a strong emphasis on customer consultation, customer service, consumer experience, and maintaining a strong consumer base.  The bargaining power of consumers is a stout force in the industry.

            Utilizing Porter’s five forces model this analysis illustrates that the home improvement retailing industry’s environment is currently an opportunity for established companies such as Lowe’s and Home Depot.  There is a low threat for new entrants in the industry, substitutes, and bargaining power of suppliers.  While rivalry and consumer bargaining power are strong forces in the industry, the established companies have a competitive advantage based on low-cost structures, economies of scale, and brand loyalty. 

Strategy

In the 1990’s, Home Depot followed a differentiation business model.  It focused on distinguishing itself from the competitors with knowledgeable, helpful employees, brand-name products, and a unique customer experience (Brown, 2007).  As the home improvement retailing industry matured and became less fragmented, Home Depot recognized the need for a new strategy to maintain a competitive advantage and increase profitability.  Therefore, Home Depot’s top management team decided to implement a cost-leadership strategy (Brown, 2007).  Home Depot also utilized a chaining strategy to achieve cost advantages and consolidate the industry.  It established networks of connected retail stores which helped them control their supply costs (Hill & Jones, 2008).

The cost-leadership strategy The Home Depot adopted allowed it to lower its cost structure and improve operating performance.  This has enabled Home Depot to be more profitable than Lowe’s and other competitors, such as Menards.  Another benefit of the cost-leadership strategy is that Home Depot is able to charge a lower price which attracts more customers and increases its competitive advantage (Corral, 2010).  The Home Depot has been able to “destroy brands and transform entire products into low-margin commodity markets (Schwalm & Harding, 2000).”

Within its cost-leadership model, The Home Depot has established a “three-pronged strategy to boost business this year and onward (Corral, 2010).”  It is specifically concentrating on supply-chain transformation, merchandise transformation, and customer service.  According to Marvin Ellison, evp, U.S. stores, the three-pronged strategy creates great value for Home Depot while instituting product authority (Corral, 2010).  Along with this, “Home Depot is shifting its model to cater to do-it-yourself customers” by changing its “product-mix in stores to focus on smaller projects” since the “money is in small projects that homeowners can accomplish themselves over one or two weekends without breaking their bank accounts (Peterson, 2011).”  Home Depot wants to improve customer service and simplify store operations.

Actions

According to Corral, “The supply chain transformation relates to the rollout of company’s new rapid deployment centers (RDC) (2010).”  The RDCs have “dramatically improved store environments,” and   allow for the shifting of payroll from moving freight to concentrating on customers (Corral, 2010). Nineteen new RDCs have been opened and now cover 100% of the retail stores (Wahlstrom, 2010).  According to Ellison, the RDCs have “improved lead times and they’ve improved our overall turns (Corral, 2010).”

The merchandising transformation initiative focuses on “providing great value and reestablishing product authority (Corral, 2010).”  This allows individual stores to more closely monitor their own product inventories.  There is also an automated clearance cycle which reduces the amount of products that are marked down.  In turn, this aids Home Depot’s profit margin (Corral, 2010).

Good customer service is vital for The Home Depot to maintain its competitive advantage.  Therefore, The Home Depot is concentrating on associates who interact with customers, as well as customers themselves.  Associates receive a generous benefits package, and good performance is always rewarded.  Home Depot also provides leadership to allow associates to continue developing their knowledge (Corral, 2010).  Knowledgeable employees are better able to meet consumer needs.  This leads to autonomous actions on the part of the associate which is important for combating new technology and adverse situations (Hill & Jones, 2008).  For customers’ benefits, Home Depot has simplified its product return process.  It has also begun providing guaranteed price matching, as well as other bonuses (Corral, 2010).

Home Depot is working to attract new customers through technological advances such as, its online website, iPhone and Android apps, self-checkout with SAP platform, and YouTube videos.  The online website provides a much larger assortment of products for consumers than in stores (Smith, 2006).  The self-checkout technology allows more employees to be on the store floor assisting customers, and saves Home Depot $1 billion a year (Dignan, 2005).  The smart-phone applications allow customers to search and shop from their phones, locate stores, and learn individual stores layouts.  YouTube is a great way to achieve media-promotion and the free-help videos and how-to advice builds The Home Depot brand.  Hundreds of their videos are viewed in over thirty countries (Zmuda, 2011).

Additional actions that Home Depot has taken to attract new customers include:  new products, “new-everyday savings,” credit card program, and targeted circular advertising (Wahlstom, 2010).  New products include the Martha Stewart Collection, soft flooring, and theater systems.  The “new-everyday savings” provides discounts for customers who use their Home Depot credit card.  The targeted circular advertising focuses on specific market segments, such as the do-it-yourself customers (Wahlstrom, 2010).

Financial Analysis

An analysis of trends, a competitor, and the industry reveals that Home Depot, Inc. is in a good financial position.  An examination of trends of Home Depot’s ratios for the years of 2007 through 2011 revealed several points. Please refer to Table 1 as a reference.   In 2007 Home Depot’s inventory turnover had been 4.09.  The turnover rate increased throughout 2008 and 2009 spiking up to 4.43 and declining again through and 2011 and is now down to 4.21.  The inventory turnover rate has not reached 2007 levels yet.  However, with the continuous recovering of the economy, HD may be able to regain pre-crisis levels.  In 2007, Home Depot’s debt ratio was at .52, yet in 2008 it spiked to .60.  It may be that HD took on more debt to continue operations through the recession.  HD’s debt ratio began to decrease in 2009, yet it has not regained pre- economic crisis levels.  In 2007, Home Depot’s return on assets was .11 and began to decrease through 2008 and 2009.  However, the return on assets has begun to increase again for 2010 and 2011.  HD’s current ratio for 2007 was 1.39 and dropped down to 1.15 in 2008.  Since 2009, HD’s current ratio has steadily increased, yet it has not achieved 2007 levels.  The economic crisis had a significant influence on Home Depot’s liquidity, but Home Depot is regaining the liquidity necessary to meet its debt obligations.

            An analysis of Home Depot, Inc. in comparison to Lowe’s Companies Inc., a home improvement retailing competitor, revealed interesting ratio differences between the two companies.  Please refer to Table 1: Home Depot’s Ratios and Table 2: Lowe’s Ratios for specific ratios (on page?).  Compared to Lowe’s, Home Depot has had a higher total asset turnover from 2007 to 2011.   Therefore, Home Depot may be utilizing its assets more efficiently than Lowe’s.  Home Depot’s inventory turnover rate was higher than that of Lowe’s for 2011 and 2010.  This may indicate that Home Depot’s inventory is more liquid than that of Lowe’s, or Home Depot may have stronger inventory management.  Also, Home Depot’s return on assets has been two percent higher than that of Lowe’s in 2011 and 2010.  This may reflect that Home Depot has a management team that is more effective at creating profits with its available assets.

            A comparison of growth rates and price ratios reveals that Home Depot is currently in a stronger position than Lowe’s.  In an evaluation of sales this quarter versus the previous year’s quarter, Home Depot has a 3.8% sales growth rate while Lowe’s only has 3.1%.  Also, Home Depot’s net income for the year to date versus the previous year to date was 121.9 in contrast to Lowe’s -34.  However, Lowe’s 5-year annual dividends were 30.73 while Home Depot’s were only 18.76.  It may be that Home Depot is claiming more in retained earnings than Lowe’s.  Additionally, Lowe’s P/E ratio is 18.9 in contrast to Home Depot’s 18.7.  Yet, .2 may or may not reflect a significant difference in price/earnings.  Home Depot’s current price/book value is 3.23 while Lowe’s is 2.0.  This leaves Home Depot 1.23 points higher than its competitor.  Home Depot’s current price/sales ratio is 0.90 while Lowe’s is 0.72.  This is a reflection of Home Depot having a higher stock price than Lowe’s.   Home Depot’s price/cash flow ratio is 12.30 compared to Lowe’s 9.80.  Since Home Depot has a significantly higher price/cash flow ratio, it must have more cash on hand to utilize than Lowe’s.  This is apparent since the statement of cash flows adds back in the costs of depreciation which are really just a “paper cost” without cash outlay.     

            An assessment of Home Depot’s relation to the home improvement retail industry, Home Depot seems to be doing well.  Home Depot’s gross profit margin of 34.3 is above the industry’s 33.7.  Home Depot also has higher pre-tax and net profit margins than the industry.  Home Depot’s sales for this quarter versus the previous year’s quarter are .30 higher than the industry, and HD’s net income for the year to date versus the previous year is 121.90 compared to the industry’s 62.40.  Home Depot net income rate is substantially greater than the industry average.  This may reflect that Home Depot’s management has been more efficient at controlling costs than other companies in the industry.  Yet, Home Depot’s dividend rate is 18.76, while the industry’s is 22.31.  Home Depot may be claiming more retained earnings than other companies.  Finally, Home Depot’s price/sales ratio, price/book value ratio, and price/sales ratio are slightly above those of the industry.

            Home Depot, Inc.’s financial position appears to be well and stable.  Home Depot was in a strong position in 2007 which it lost during the economic crisis of 2008.  Yet, Home Depot has been steadily making gains since then to control its inventory, costs, and debt.  Home Depot seems to be managing operations more efficiently than its competitor, Lowe’s.  Home Depot’s market price, book share value, return on assets, and total asset turnover are higher than Lowe’s.  Home Depot has been riding alongside the industry, as well as surpassing it in areas like sales and net income.  Home Depot, Inc. is operating at a satisfactory level.

Table 1: Home Depot Ratios
Period Ending:	2011	2010	2009	2008	2007
Current	1.33	1.34	1.19	1.15	1.39
Acid	.28	.36	.24	.23	.40
Inventory Turnover	4.21	4.29	4.43	4.38	4.09
Net Receivable Collection Period	5.74 days	5.24 days	4.91 days	5.86 days	14.68 days
Total Asset Turnover	1.69	1.62	1.73	1.75	1.51
Debt	.53	.53	.57	.60	.52
Gross Profit Margin	.34	.34	.34	.34	.34
ROA	.08	.07	.05	.10	.11

Table 2: Lowes Ratios
Period Ending:	2011	2010	2009	2008	2007
Current	1.4	1.32	1.21	1.12	1.27
Acid	.23	.20	.13	.14	.18
Inventory Turnover	3.80	3.73	5.88	4.15	4.30
Net Receivable Collection Period	1.42 days	1.59 days	.78 days	2.22 days	1.63 days
Total Asset Turnover	1.45	1.43	1.48	1.56	1.69
Debt	.46	.42	.45	.48	.43
Gross Profit Margin	.35	.35	.34	.35	.35
ROA	.06	.05	.07	.09	.11

Recommendations  

The Home Depot, Inc. needs to intensify its international concentration to achieve greater economies of scale.  It should also consider creating customized products to meet local needs in other countries, such as China and Canada.  The current marketplace is focusing more on green/renewable energies.  Therefore, The Home Depot, Inc. should expand its product lines with more renewable energy products.  Home Depot has always been a leader in the industry.  In order to maintain this status, it needs to broaden its market segment.  One way to do this would be to extend its marketing to female consumers.

The Home Depot, Inc. should continue emphasizing customer service.  They should have stipulations that all customers are to be greeted and assisted.  If associates are consistent with this they will be rewarded and this will work as a psychological positive reinforcement of their behaviors.  Associates also need to be extensively trained on information about all products and be able to assist customers with information on do-it-yourself projects.

Works Cited and Consulted

Apple. "App Store- The Home Depot." Web. 29 Nov. 2011. http://itunes.apple.com/us/app/the-home-depot/id342527639?mt=8.

Corral, Cecile B.. (2010). Home Depot on Path to Recovery with Three-Pronged Initiative. Home Textiles Today. Retrieved from Ebscohost on Novemeber 25, 2011.

Dignan, Larry. "Home Depot Self-Checkout Boosts Sales, Satisfaction - Projects Management - News & Reviews - Baseline.com." Information Technology Planning, Implementation and IT Solutions for Business - News & Reviews - Baseline.com. Web. 28 Nov. 2011. <http://www.baselinemag.com/c/a/Projects-Management/Home-Depot-SelfCheckout-Boosts-Sales-Satisfaction/>.

Hill, Charles W.L., Jones, Gareth R. (2008). Strategic management: an integrated approach. Mason, OH: South-Western Cengage Learning.

Peterson, Kim. (2011). Home Depot on a Roll. msnMoney.  Retrieved from: http://money.msn.com/top-stocks/post.aspx?post=77ab436a-0c69-454c-852e-f64b13d3d23b&rrurt=1&rrcontrolId=ratCntrlBinary

Harding, David & Schwalm, Eric. (2000). Winning with the Big-Box Retailers. Harvard Business Review.  Retrieved from Ebscohost on November 29, 2011.

Hoover’s Inc.. (2011). Home Improvement and Hardware Retail Industry. Retrieved from http://www.hoovers.com/industry/home-improvement-hardware-retail/1539-1-0-1njg0x.html

Joint Center for Housing Studies of Harvard University. (2011). A New Decade of Growth for Remodeling.  Retrieved from http://www.jchs.harvard.edu/publications/remodeling/remodeling2011/index.htm

Lowe’s 2010 Annual Report.  (2011). Retrieved from

http://www.lowes.com/AboutLowes/AnnualReports/annual_report_10/financials/managements_discussion_and_analysis.pdf

MsnMoney. "Home Depot on a Roll- MSN Money." Money: Personal Finance, Investing News & Advice - MSN Money. Web. 25 Nov. 2011. <http://money.msn.com/top-stocks/post.aspx?post=77ab436a-0c69-454c-852e-f64b13d3d23b>.

"Our New Android App Is Here: More Saving, More Doing – All from Your Android Smartphone - The Apron Blog by Home Depot – Tips, Ideas, Products and Inspiration for Your DIY Projects and Home Improvement." Home Improvement Made Easy with New Lower Prices | Improve & Repair with The Home Depot. Web. 24 Nov. 2011. <http://ext.homedepot.com/community/blog/new-android-app-is-here-more-saving-more-doing-all-from-your-android-smartphone/>.

The Home Depot Annual Report 2010. (2011). Retrieved from

http://www.homedepot.com/webapp/wcs/stores/servlet/HomePageView?storeId=10051&catalogId=10053&langId=-1&orig_ref=http%3A%2F%2Fwww.google.com%2Faclk%3Fsa%3Dl%26ai%3DCu7BQM8lvTuKyLsG9sQK8g8n3CLSOwdwBvNz16x-148kMCAAQASCxit8GUIqI2rr7_____wFgyc7Xh-ijrBWgAe6o4_4DyAEBqgQYT9DZwOuzjn0x079QILaJY6K961BksKDmgAWQTg%26sig%3DAOD64_0SZuR_XurfiCC7ZmWJSWX1JA28OA%26ved%3D0CBMQ0Qw%26adurl%3Dhttp%3A%2F%2Fwww.homedepot.com%2F%253Fcm_mmc%253DSEM%257CTHD%257CG%257CBT1%257CHighVolume%2526skwcid%253DTC%257C13614%257Chome%252520depot%257C%257CS%257Ce%257C8453911884%26rct%3Dj%26q%3Dhome%2520depot

Wahlstrom, Peter. (2010). Home Depot: Shifting from the art of retail to the science of retail. Morningstar StockInvestor.  Retrieved from Ebscohost on November 29, 2011.

Yahoo!Finance (2011)  The Home Depot., Inc. Retrieved from: http://finance.yahoo.com/q?s=HD&ql=1

Yahoo!Finance (2011). Lowe’s Companies, Inc. Retrieved from: http://finance.yahoo.com/q?s=LOW&ql=0