The case covers the six-year tenure of Bob Nardelli at Home Depot from 2000-2006. During this time he published the impressive numbers, but also changed the strategic orientation of the Home Depot website. He failed, however, to improve the company's share price. This difficulty, in conjunction with the payment package Nardelli (negotiated during the economic euphoria when he was one of the two most wanted leaders in America), heavily strained relations with shareholders. The case traces the deterioration of their relations through the prism of the annual general meeting. They were converted from "lovefests" under his predecessor to more unmanageable cases - culminating in a catastrophic meeting in May 2006, which indirectly led to the resignation of Nardelli in early 2007. The case examines the relationship Nardelli with two key stakeholders - the board of directors and shareholders - as well as issues of self-government. At first glance, this case can be read as a story of greed and poor corporate governance - too greedy CEO / chairman, who manipulates the board is giving him high compensation and productivity pressures. Recognizing some of these aspects, we propose a different view of the situation, focusing instead on the self-fulfilling and self-reinforcing nature of the dysfunctional dynamic between the CEO and shareholders - and the inability to pay to compensate. We focus on the psychological and behavioral processes that led the parties to completely avoid it. Learning Objectives: The main problem is Bob Nardelli growing difficulties in dealing constructively with the shareholders of the company - and the lack of understanding of their role (as a change agent) and motivation (if it is only about money.) This is also the case of the board, which does not understand how to help the CEO that he values very highly. The case allows the discussion of the Council's role in assisting the General Manager to overcome such problems. "Hide
by Jean-Francois Manzoni, Jean-Louis Barsoux Source: IMD 22 pages. Publication Date: July 8, 2008. Prod. #: IMD352-PDF-ENG
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