The principles that guide us will continue to lift humanity
The following are excerpts from “Good Company,” by Arthur Blank (William Morrow, September 2020).
On Risk and Innovation
When a company takes a risk to do the right thing and is rewarded by improvements in revenue and reputation, it can give others the courage to do the same. Many businesses are risk-averse, and they don’t necessarily want to go first, but if they have an example to model themselves after, they’re more likely to change. Sometimes this happens simply through comparison; other times the pressure to change comes from customers who notice the difference in one business and begin to demand the same from its competitors. When we dramatically reduced our pricing for food and drinks at Mercedes-Benz Stadium, some of our partners and most of our competitors weren’t happy. Now, they’re lining up to learn about our fan-friendly model, and many are implementing it themselves.
On the ‘Why’ of Mercedes-Benz Stadium Setting New Standard on F&B Pricing
As awe inspiring as the stadium was going to be, people would get used to it. But being treated like human beings, being shown respect for their families and their hard-earned money — that never gets old. So food and beverage represented an amazing opportunity. It’s a small percentage of overall revenue for a stadium, but it has an outsized impact on fan experience, ranking third among determinants of game day satisfaction, according to the NFL’s Voice of the Fan survey. Every time our fans stepped up to a concession stand and got affordable, quality products with great service, they’d feel our appreciation and be reminded that we were not trying to take advantage of them.
On Buying the Falcons
The opportunity to own an NFL team doesn’t come around too often, and it wasn’t a moment to get lost in trying to “win” the deal. I booked a nice hotel suite and invited Taylor [Smith] for dinner.
Over a very good meal and a bottle of wine, I said to him, “Let’s do this deal. We’re not that far apart. Let’s just split the difference.” The resulting number was $545 million. “Okay, let’s do it,” he said. I picked up a cloth napkin, took out a pen, and began to write: “For Atlanta and the Falcons, $545 million. To the heritage and the tradition, in the past and the future.”
“What are you doing?” he asked. “This is a bond between the two of us,” I explained. It was an old tradition from the Home Depot days — when you come to an agreement, you sign a napkin right then and there. And it has to be a cloth one — important deals don’t get done on paper napkins.
On Building The Home Depot
People came to The Home Depot — and came back, again and again — because of our outstanding service and great people. They loved us because we never cut corners on the things that mattered to them. We valued efficiency, but we valued effectiveness more. If having field offices in regions around the country made us more effective at serving our local customers, we’d do it, even though it might have been more efficient to run everything from a centralized office. We knew that if we had ever compromised our values for the sake of efficiency, we would have slowly but surely lost the trust and loyalty of our customers.
On Ownership Philosophy
There were many things about the NFL that were foreign to me — dealing with coaches; understanding salary cap, the draft, and free agency; negotiating media contracts and sponsorship deals; dealing with the league and the players’ union. I felt like a junior senator for a while and was grateful to all the veterans who offered guidance, encouragement, and opportunities to learn. But beneath the surface differences, a business is a business and people are people. The values that make a retailer a good company can make a football team a good company. In fact, one of the things I’ve come to love about owning a team is the unique relationship between fans and the franchise. I’d always run The Home Depot on the principle of cultivating customer loyalty over the long term and making our customers feel like family. Fans take that one step further. They literally feel as though they own the team and they play a role in its wins and losses. And it’s true, they do. It’s Atlanta’s team, not mine — I’m just a custodian.
On Being a Good Company
I deeply believe that we live in an abundant world — one in which there is enough for everyone. Humanity is rich in ingenuity, talent, and resources. As a species, we have proven our resilience time and time again, and we continue to make measurable improvements on a global and national scale in lifting people out of poverty, providing education, and opening doors of opportunity. The key that unlocks this abundance is our values — the principles that guide us in business and in life. If our enterprises are rooted in values like those I’ve outlined in this book, they will be a force for good and will become role models for others to follow. There is enough pie for everyone. And good companies — values-driven companies — continue to make the pie bigger.
Arthur Blank is co-founder of The Home Depot and chairman of AMB Group, parent company of the Atlanta Falcons and Atlanta United FC.