Nardelli, Robert

▪ 2008

Robert Louis Nardelli 

born May 17, 1948, Old Forge, Pa.

      The year 2007 began with an ending for Robert Nardelli: bowing to pressure from shareholders, on January 2 the board of directors of home-improvement retailer the Home Depot persuaded him to resign as CEO. Shareholders, angry that the company's stock price had been sinking for years, also resented Nardelli's $38 million salary in an era of slowing sales and stiff competition from competitors such as Lowe's. Just six months after leaving Home Depot, however, Nardelli accepted the top job at automaker Chrysler, which had recently been spun off by its former owner, German automotive firm Daimler.

      Nardelli served in the Reserve Officers Training Corp while earning a B.S. (1971) in business. After graduation he joined General Electric, where his father had worked as an engineer and middle manager. While working at GE, Nardelli earned an M.B.A. (1975) from the University of Louisville, Ky. By 1988 he had become a company vice president, but when GE failed to move him into a general management position, he left to take a position as a division leader with Case Equipment Co. He returned to GE as the head (1991–92) of its appliance-manufacturing subsidiary in Canada and then held the top jobs at GE Transportation Systems (1992–95) and GE Power Systems (1995–2000); under his leadership GE Power Systems' sales grew from $5 billion to $20 billion.

      It appeared that Nardelli had become a leading contender for the job that he had spent his career pursuing: the CEO of GE, but he was passed over for that job in November 2000. Within one week he was tapped for the CEO position at Home Depot—a company growing so rapidly that its board of directors welcomed the structure and fiscal discipline that the GE alumnus would bring. Nardelli reduced costs, revamped purchasing systems, upgraded communications and information technology infrastructure, and opened numerous stores. He lacked a background in retail management, however, and some of his initiatives drove customers away. Rivals cut into Home Depot's market share, and as the company's competitors increased in value, Home Depot's value sank. When Nardelli left the firm, some analysts (and shareholders) saw his $210 million severance package as an insult.

      After taking the helm at Chrysler in August, Nardelli selected his new management team, luring the head of Toyota's North American operations to lead sales and marketing. Chrysler weathered a brief labour strike in October, put several large pieces of property on the block to generate an expected $1 billion in cash, and began eliminating weaker vehicle models while laying off thousands of workers in North America. It remained to be seen if Nardelli could achieve his mandate to improve quality, sharpen Chrysler's brand identity, and turn the struggling firm into a profitable car manufacturer.

Sarah Forbes Orwig

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▪ American businessman

in full  Robert Louis Nardelli 

born May 17, 1948, Old Forge, Pa., U.S.

      American businessman who served as CEO of Home Depot (2000–07) and Chrysler (Chrysler LLC) (2007– ).

      Nardelli served in the Reserve Officers Training Corp while earning a B.S. (1971) in business. After graduation he joined General Electric (General Electric Co.) (GE), where his father had worked as an engineer and middle manager. While working at GE, Nardelli earned an M.B.A. (1975) from the University of Louisville, in Kentucky. By 1988 he had become a company vice president, but when GE failed to move him into a general management position, he left to take a position as a division leader with Case Equipment Co. He returned to GE as the head (1991–92) of its appliance-manufacturing subsidiary in Canada and then held the top jobs at GE Transportation Systems (1992–95) and GE Power Systems (1995–2000); under his leadership GE Power Systems' sales grew from $5 billion to $20 billion.

      Although it appeared Nardelli had become a leading contender for the job that he had spent his career pursuing—the CEO of GE—he was passed over for that job in November 2000. Within one week he was offered the CEO position at the home-improvement superstore Home Depot—a company growing so rapidly that its board of directors welcomed the structure and fiscal discipline that the GE alumnus would bring. Nardelli reduced costs, revamped purchasing systems, upgraded communications and information-technology infrastructure, and opened numerous stores. He lacked a background in retail management, however, and some of his initiatives drove customers away. Rivals cut into Home Depot's market share, and as the company's competitors increased in value, Home Depot's value sank. Nardelli became increasingly unpopular, and in 2007 he resigned in order to become CEO of Chrysler. Some analysts (and shareholders) sharply criticized his $210-million severance package.

      After taking the helm at Chrysler, Nardelli selected his new management team, luring the head of Toyota (Toyota Motor Corporation)'s North American operations to lead sales and marketing. Chrysler weathered a brief labour strike in October 2007, put several large pieces of property on the block to generate an expected $1 billion in cash, and began eliminating weaker vehicle models while laying off thousands of workers in North America. Despite Nardelli's hopes to turn the struggling firm into a profitable car manufacturer, Chrysler's sales continued to show declines in 2008.

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