Home Depot Long-Term Objectives Home

Home Depot Long-Term Objectives Home Depot Financials In a December 2008 Fortune 300 report on 'Home Depot' it is stated that while "...new CEO Frank Blake took the helm early last year, but sales still slid nearly 7%. " (Fortune 500, Dec.

2008) the following lists the financials for Home Depot for 2007: Home Depot Financials % change in U.S.$millions from 2006 to 2007 millions change from 2006 Revenues Profits Assets Stockholders' equity Market value (3/28/2008) Profits as % of Profits as % of Revenues Assets Stockholders' equity Earnings per share (EPS) Earnings per share 2007 $ change from 2006 1997-2007 annual growth rate % Total Return to Investors Total return to investors 1997-2007 annual rate Source: Fortune 500 (2007) Figure 5: Industry - Special Retailers (Top 3) Rank Company 500 rank Revenues ($ millions) Home Depot Costco Wholesale Lowe's Source: Fortune 500 (2007) LONG-TERM OBJECTIVE & STRATEGIES Long-Term objectives stated by Home Depot include those as follows: Develop and maintain a global presence; Long-Term Incentives: Home Depot states that it delivers "...long-term incentives typically in the form of a cash-based LTIP, shares of restricted stock, deferred shares or deferred stock units stock options, performance shares and performance vested options.

Equity grants may also be made to newly hired executive officers outside of our annual grant process, upon commencement of employment and, on occasion to executive officers in connection with a significant change in job responsibility." (2008) Stated is that awards, "payable in cash at the end of the performance period" is used as a measure of long-term financial performance to provide continuing emphasis on specified financial performance goals as these are "important contributors to long-term share holder value." (Home Depot, 2008) Revilement was made to the LTIP program for Fiscal 2007 in that the LTIP program added a return on invested capital (ROIC) performance goal with the REVISED LTIP payout being equally weighted to the achievement of the EPS and ROIC performance goals." (Home Depot, 2008) Stated as the reason for this decision to "include ROIC as an addition performance measure was based on..." The desire to "focus management on the efficient use of capital." (Home Depot, 2008) III.

EXECUTIVE COMPENSATION PRINCIPLES From these examples it can be understood that the entire focus of Home Depot is based on a long-term view in terms of the relationship that it will have with its current employees and Home Depot sees that relationship as one that is ongoing and mutually beneficial for both Home Depot and the employee and in the long-term. The following table lists the executive employee compensation for Home Depot in for 2008.

Home Depot Executive Compensation Source: Home Depot (2008) DISCUSSION It is clear from the long-term goals set out by Home Depot that the desire to build ongoing relationships with its employees is one of the primary focuses of Home Depot in terms of its business strategic goals.

Home Depot believes that goals should be set and attainable although not automatically realized but requiring focus and commitment and excellence in order to reach these attainable and highly lucrative goals with cash payment and on a certain foreseeable date in the future and even in the very near future.

Home Depot has integrated and continues to integrate into the community in which it is located and employing individuals in those communities and for those employees who are committed to the organization the rewards exist and in handsome measure as an incentive to drive performance and productivity. The principles of management in the.