Rome Depot

Watching the events unfold at Home Depot earlier this year reminded me of the HBO series “Rome.”

Though Rome had become a powerful empire, the senators were unhappy. Romulus and Remus, the twin founders who had created the senate and laid the groundwork for the republic, were long gone. In their place stood Julius Caesar.

After a successful campaign in Gaul, Caesar was welcomed into Rome. But he was arrogant. Too powerful. Too well-paid. Too ambitious.

So the senate “asked” for Caesar’s resignation.

There to pick up Caesar’s bloody cloak was his former lieutenant, Mark Antony. But could Antony be trusted? He had, after all, been with Caesar in Gaul.

Make the obvious substitutions – the role of Caesar will be played by Robert Nardelli; Mark Antony = Frank Blake; the Roman senate = the Home Depot board of directors; Romulus and Remus = Bernie Marcus and Arthur Blank; Gaul = General Electric – and you have a Shakespearean drama unfolding in Atlanta.

Okay, the two story lines diverge. Antony made some poor decisions, lost some battles and ended up dallying with Cleopatra in Egypt before falling on his own sword. It appears Frank Blake will avoid those same mistakes. In fact, he’s becoming a reformer.

First, he agreed to a total compensation of $8.9 million if he meets profitability and stock market goals. His predecessor had earned $123.7 million in 2005, excluding certain stock option grants. And Nardelli was paid bonuses whether or not sales grew or the stock price gained.

Next, Blake sought to reassure employees that he is burying Caesar, not praising him. He told them, upon taking office, to “lighten up” and “have fun again.” He followed that up with a program to distribute a $3000 “fun fund” for each store to spend at its own discretion – on a holiday party, perhaps, or some spontaneous outing.

He abolished a Nardelli perquisite: a catered lunch for top executives, served daily on the 22nd floor. Instead, he told senior executives to begin taking the elevator down to the company cafeteria and eating with the plebians.

Blake said he would single-mindedly focus on customer service. He also reintroduced an old company icon from the founders’ days, called the “inverted pyramid,” that places customers and employees at the top of the company’s hierarchy. The image had fallen out of favor under Nardelli.

In fact, Blake invited Arthur Blank and Bernie Marcus to be available as informal advisers. The founders, still revered within the company, were obsessed with the store experience.

Perhaps none of this comes as a surprise. Blake developed the skills of a diplomat as deputy secretary for the U.S. Department of Energy and general counsel for the Environmental Protection Agency.

At GE, Nardelli and Blake seem to have been the yin and yang of Jack Welch. While Nardelli was emulating Welch’s management style, aggressively climbing up the executive ladder, Blake was studying Welch’s management philosophy, especially the Six Sigma concepts of critical quality and customer service. (GE practically invented customer service.)

At Home Depot, while Nardelli was managing the business, Blake was learning the business. His responsibilities have included strategic development, growth initiatives, real estate and store construction. So while both were non-merchants when they came to Atlanta, Blake has tried to make himself one.

Blake has said he wants to return Home Depot to its roots as a retailer — the Home Depot before Nardelli. It’s still the second-largest retail company in the U.S. Perhaps it got too fat. Now maybe it’s time for a lean and hungry look.