Like most retailers the Atlanta based home supplies chain, Home Depot, is facing tremendous pressure to be more efficient, increase sales/revenue….basically do more with less.  To that end, they are reorganizing the human resources function—a move that will result in cutting its 2,200-person HR staff in the field by about 50 percent.

Today there is an HR manager in every store, but in the future, there will be 230 district HR teams that will oversee six to ten stores each.  Each team will consist of an HR district manager and three HR managers who report to that person.  Each store will continue to have an administrative HR employee on site who will oversee schedules of the associates. Home Depot is also creating a 200 person service center to handle HR calls from employees and managers.  The new structure is expected to be in place by May.

Home Depot plans to use the savings resulting from this restructuring to add three sales associates to the floor of each of its stores by year-end.  Analysts are already applauding the move by Home Depot believing that they were overstaffed with the current structure. 

I think that it will take some time before we know if this restructuring really saves them money.  Without the right support and training for the store managers, Home Depot may find itself redirecting its HR workforce “savings” into a litigation fund.  Store managers will need to be willing and prepared to “step up” to activities currently handled by their on-site HR such as employee relations, wage and hour, and harassment issues. 

We’ve seen that other big-box retailers such as Wal-Mart have learned the hard way that it can be very costly to the organization when there aren’t enough HR reps in the field.   So with Home Depot, we will wait and see.