Internal Risk Assessment - Home Depot

Topics: Strategic management, Earnings before interest and taxes, Sales Pages: 4 (1565 words) Published: January 15, 2011
Internal Risk Assessment

Internal Risk Assessment
Former president and chief executive officer of the online auction site eBay stated, “A business leader has to keep their organization focused on the mission. That sounds easy, but it can be tremendously challenging in today's competitive and ever-changing business environment. A leader also has to motivate potential partners to join” (Whitman, n.d.). These wise words expressed from a wise and highly successful business leader speak soundly in relation to motivating employees and a sustaining a competitive business advantage. Along with a competitive advantage arises the need to assess the firm’s internal risk. Departmental strengths and weaknesses, strategic endurance, and financial foundation all substantiate the level of allowable tolerance for internal risks. A publicly traded global firm, The Home Depot, Incorporated leads the world in retail building supplies and home improvement goods. According to the 2009 Form 10-K reported to the Securities and Exchange Commission (SEC), the company maintains 2,244 retail sites “Located throughout the United States including the Commonwealth of Puerto Rico and the territories of the U.S. Virgin Islands and Guam (“U.S.”), Canada, China and Mexico” (The Home Depot: Annual Report, 2009). The Home Depot wisely forecasts and assesses its risks while maintaining flexibility to assume increased or decreased influences affecting internal operations. According to the annual report for 2009, The Home Depot’s returns declined as compared with its 2008 earnings, as did stock prices. The company forecasted for this decline with the closure of several underperforming stores in 2008. Cutting the ties of projected threats made capital resources available to concentrate on heightening strengths and improving upon weaknesses. Company growth does not solely equate to the gain of more real property. Growth produces many internal facets through...

References: Datamonitor 360. August 2010. Home Depot, Inc.: Company View. Retrieved from
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