“Change must be systematic and sustainable,” emphasized Dennis Donovan ’71, ’72 MBA in a 90-minute presentation and workshop for MBA students in April. Widely admired as a corporate change agent, the Isenberg alumnus has made his mark in key executive positions with Home Depot, Raytheon, GE Power Systems, and Cerberus Operations & Advisory Company. He currently consults via his own firm, Beacon Advisors International.
“Speed is your friend in change; you have to move quickly,” he told the students. Input, he added, must emanate from the entire organization, especially lateral sources. With that said, systematic change calls for a judicious alignment of functional areas, processes, and people. Most crucial to success, he noted, is “acceptance throughout the organization—buy-in.”
The Isenberg grad illustrated those and other rubrics through a case study that revealed drastic change at Home Depot, where he was executive vice president of human resources from 2001 to 2007. When a new CEO with a mandate for change hired Donovan, Home Depot’s earnings and growth had stalled following years of spectacular success. In its complacency, the company had failed to adapt to changing market dynamics. The company, noted Donovan, lacked adequate infrastructure—no emails to stores and no scan guns at its registers, no standard reporting, and little customer data, including information about ‘super-users.’ Inventory turns, he added, took days.
Plan, execute, and transform
Donovan assembled the Isenberg students into small groups, charging them to make recommendations, “If you had my job, where would you start? What would you do to get it done?”
Donovan took the students through his own detailed, multifaceted transformation process at the company. Some of its highlights: Link change to competitive advantage. Significant processes must identify risk and opportunities. Integrated planning for strategy, operations, and resources is a must.
Execution is just as critical, he said, entailing four levers: people, processes, structure, and systems. Emphasize core competencies and enact strategic, operations, and resource plans. Partnerships with suppliers and customer interest groups are also critical. Home Depot, for example, joined forces with AARP, the military, and advocates for Hispanic consumers.
Six years after the reset, Home Depot’s sales doubled. “I got my foundation here at Isenberg, Donovan remarked. “It allowed me to grow, to compete with anyone else. Be who you are,” he told the students. “You’re coming out of a great program.”