Rank the relative power of Home Depot various stakeholders Why are they most important?

Answer 1

Ferrell, Fraedrich, & Ferrell (2008) define primary stakeholders as “those whose continued association is absolutely necessary to the firm’s survival. These included employees, customers, investors, and shareholders, as well as governments and communities that provide necessary infrastructure.” (p. 32). All of Home Depot’s stakeholders listed on their website would qualify as primary stakeholders: (1) Associates; (2) Customers; (3) Communities; (4) Vendors & Suppliers; and finally, (5) Shareholders. As primary stakeholders, they all have the same relative power. When this power gets out of balance, it can have a significant negative impact on the organization. Ranking of the first three: (1) Employees. As badly treated as Home Depot’s employees have been over the years, they have ceased power through litigation. For example, in August 2004, as a result of an approved settlement, the U.S. District Judge in Colorado ordered Home Depot to pay $5.5 million to current and former employees, as well as significant injunctive relief. “The EEOC lawsuit alleges that in Home Depots’ Colorado stores, there was a hostile work environment based on gender, race, and national origin, and that the company retaliated against employees who complained about discrimination.” During this particular time, I would have rated these employee stakeholders as the number one relative power. (EEOC.GOV, 2004) ) (2) In May 2008, angry investors voiced to Chief Executive Frank Blake about poor customer service; although there were no major battles won during this meeting, the stockholder’s relative power increased significantly. (msnbc.msn.com, 2008) For, this I would have rated the stockholders number two in relative power. (3) The positive personal empowerment generated by those who have received Home Depot’s philanthropic benefits such as those who have received a home for the first time would be rated number one in my opinion.