W.L. Mellon Speaker Series: Ted Decker Blends Art and Science to Achieve Success
Ted Decker (MSIA ’93), President and Chief Operating Officer of The Home Depot, spoke on April 13, 2021, as part of the W.L. Mellon Speaker Series at the Tepper School.
Despite only recently emerging from the other side of a tumultuous year that included strategizing and leading The Home Depot through a historic supply-chain calamity caused by an unprecedented global pandemic, Ted Decker, the company’s President and Chief Operating Officer, joined the W.L. Mellon Speaker series as the final speaker of the 2020-21 edition.
Alejandro Villanueva (MBA ’19) moderated the insightful virtual coffee chat for the Carnegie Mellon community. The two discussed topics ranging from fishing to football to literature, though the key focus was on the wisdom Decker gained since attending Carnegie Mellon three decades ago.
Trusting the Numbers and the Gut Feeling
Decker’s background is diverse, including an undergraduate degree in English literature, business roles in corporate finance at large companies, and international assignments in Australia and England. This set of experiences has given him a broad perspective on how human nature interacts with the inherent austerity of numbers.
“I love math and numbers and the structure of a finance or an operations research problem because you know there's an answer and you need to use that answer to influence the decision,” he said. “There's an art piece, there's a gut piece, there's a feel piece. You have to understand the change management issues, the strategic issues, the integration issues. And then there's a science piece in how you get to that evaluation.”
Though he’s not a risk-taker by nature, Decker believes that taking a risk can be critical to driving business forward. “You just need to be educated in calculated risks and you need to spend as much time on the downside — the plan B — as the upside,” he explained. “I’ve always had confidence in my understanding of finance and financial theory,” he said, crediting his education at Carnegie Mellon.
COVID-19 Crisis: Tackling Supply-Chain Hiccups With Wartime Strategies
Decker’s integrated philosophical approach to business and retail became a cornerstone of how he navigated the COVID-19 pandemic in his role at The Home Depot. As uncertainty permeated the globe, he and his colleagues knew they needed to act quickly to maintain their high level of customer service and the safety of their employees. “As soon as we saw how bad this was going to be, we set up a joint war room,” he said, describing the virtual “room” that combined the heads of every interest group at the company. As the United States’ third-largest importer of cargo freight, time was perhaps the most depleted resource during this unparalleled global supply-chain challenge.
“We literally had a white board out so we could look at who was the most pinched, where could we make it through if given the proper forecast,” Decker said. He recalled the challenges that came after realizing that no matter how steadfast The Home Depot’s supply chain had been in the past, certain long-term vendors would simply not be able to meet the demand due to the pandemic. Yet, with the calculated risks clearly presented on the board, he was able to not only minimize loss, but completely subvert it.
In fact, Decker helped The Home Depot realize one of its most successful years to date. This was thanks to both a methodical approach in the “war room” as well as the flexibility to meet a newly engaged customer base of people inspired to take on new DIY projects.
“Our plan last year was to grow by $4 billion and we ended up growing by close to $22 billion, so we just had a year to beat all years,” Decker said, who, as always, continued to weigh the pros and cons. “But to have such good fortune in the midst of such bad fortune — you have to be careful how you interpret that. We also realize that at some point people are going to [have different priorities] … but on the other hand, I couldn't be more bullish about our industry for the medium and long term.”
Beginning in 2006, the W.L. Mellon Speaker Series has provided an opportunity for students to interact with global leaders, CEOs, and management experts.