Oh Happy Day!
Only three days into the new year and already, I am greeted by the best of news! Bob Nardelli, CEO of Home Depot, has resigned! Can I get a Hallelujah????
I know, this topic means very little to many of you, but for me, someone who has every intention of retiring on the value of my Home Depot stock, it has great importance. I have watched Nardelli (a CEO transplant from General Electric) come into the Big Orange Box and in his first year, destroy everything that made the company great.
Home Depot was started in 1978 by Bernie Marcus and Arthur Blank. These two men, idolized by associates, were the foundation, backbone and life pulse of the big orange stores. Daily language in the store was filled with cliches such as "Stack it high and watch it fly!", "Are you a hero or a zero?" and tougher ones such as "Just make it happen!". Most importantly, every person in the company was taught the key to solving any issue that might develop... "Do the right thing." Do the right thing for the customers, do the right thing for the store, do the right thing for the employees. Those of us who believed it and lived it, went far.
Well, for once, Nardelli did the "right thing". He has taken his scare tactics, his heavy handed micro management style and his $210 million dollar separation package (yes, that's not a typo) and gone elsewhere.
The greatest loss is not measured in dollars, but in the reputation of the company. Maybe, to the benefit of customers and employees, the company will start to heal, but I don't think it can ever rebuild the culture and belief system that made it great.
I know, this topic means very little to many of you, but for me, someone who has every intention of retiring on the value of my Home Depot stock, it has great importance. I have watched Nardelli (a CEO transplant from General Electric) come into the Big Orange Box and in his first year, destroy everything that made the company great.
Home Depot was started in 1978 by Bernie Marcus and Arthur Blank. These two men, idolized by associates, were the foundation, backbone and life pulse of the big orange stores. Daily language in the store was filled with cliches such as "Stack it high and watch it fly!", "Are you a hero or a zero?" and tougher ones such as "Just make it happen!". Most importantly, every person in the company was taught the key to solving any issue that might develop... "Do the right thing." Do the right thing for the customers, do the right thing for the store, do the right thing for the employees. Those of us who believed it and lived it, went far.
Well, for once, Nardelli did the "right thing". He has taken his scare tactics, his heavy handed micro management style and his $210 million dollar separation package (yes, that's not a typo) and gone elsewhere.
The greatest loss is not measured in dollars, but in the reputation of the company. Maybe, to the benefit of customers and employees, the company will start to heal, but I don't think it can ever rebuild the culture and belief system that made it great.
posted by Barb at 8:30 AM
2 Comments:
I trust that you are diversifed enough so the fortunes (and misfortunes) of a single company will not harm you significantly. Back when I was a financial planner I always recommended no more than 10% in any single company - it is just too danged dangerous.
P.S. Not that it makes it better but that $210 million was negotiated when he was hired, and not settled on when he left HD. So you can thank the board of directors for creating this great pay plan to lure him away from GE.
Ditto, Barb. I'm a long time HD shareholder too.
Stay tuned...
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