coverage last week of President Obama's remarks on
bankruptcy, the camera found a downtrodden Bob Nardelli watching the president talk about how the automaker had failed.
For a moment, I felt sorry for the man. Then something ran over me like a Dodge Stratus: Nardelli is an awful CEO, and he had this coming.
Honestly, I have nothing personal against him, but as the poster boy for exorbitant golden parachutes, Nardelli sure is an easy target. Now that he's set to leave Chrysler after it emerges from Chapter 11 bankruptcy protection (he will return to Cerberus Capital Management, which controls Chrysler, as an adviser), he will have walked away from a second iconic U.S. company after performing very poorly in the top position.
Did anyone believe Nardelli was the man for the job when Cerberus installed him as the CEO of Chrysler? History hasn't been very kind to Nardelli, and it's unlikely to be revised now. Fool me once, shame on you. Fool me twice ... .
"From a PR perspective, he has not handled himself well in his last two CEO positions," said Paul Nolte, director of investments of Hinsdale Associates.
After a tenuous six-year run at
, Nardelli left with a severance package that totaled more than $200 million. In his defense, Nardelli didn't run Home Depot into the ground. In fact, revenue and earnings at the home improvement retailer increased annually.
But over his time with the company, Nardelli collected $225 million as his salary. Combined with his severance package, Home Depot essentially paid Nardelli more than $400 million for the stock to go nowhere. Shares were essentially unchanged while rival
surged more than 200%, and Nardelli did very little to placate irate shareholders.
Additionally, Nardelli did all he could to build up Home Depot's wholesale unit, only to see the company sell it after he left to a consortium of private-equity firms for considerably less than the asking price. Nardelli was often criticized by shareholders for expanding the supply unit at the expense of retail performance.
After Chrysler hired Nardelli, he famously cut his salary to $1 a year. Cerberus Capital, which is Chrysler's majority owner, told me Friday that Nardelli was not paid any other compensation while running the automaker.
The salary cut was an important sign to the public, especially with all of the attention paid to the health of the U.S. automakers and the backlash against excessive executive compensation. But Nardelli was billed to be the man who would turn Chrysler around, and he failed to do it.
"It's always a head-scratcher when you see someone with a high profile that has truly been unsuccessful in turning things around get another opportunity," said Art Hogan, chief market analyst with Jefferies.
Of course, Chrysler was damaged goods before Nardelli arrived. Still, it's hard to hear Nardelli say that, after bankruptcy, it is now the "appropriate time to let others take the lead in the transformation of Chrysler with Fiat." Apparently, he was good enough to drive the automaker into bankruptcy, but he can't tow it out.
current CEO, makes Nardelli's performance look even worse. After enjoying success at
, Mulally took the reins at Ford at a time when market share was slipping and both losses and debt were mounting. While Nardelli enjoyed the shelter of working for a privately owned automaker, Mulally cut costs and revived the Taurus brand while facing scrutiny from shareholders.
Now, Ford is essentially the strongest U.S. automaker. Even
was in a worse predicament than Chrysler, and it still hasn't had to seek court protection.
For market analysts, Nardelli's consecutive losing turns could signal the end of an era where CEOs spend more time in front of a camera than behind closed doors.
"When you look at CEOs, we've gotten to the point where they've become stars," Hinsdale's Nolte said. "If you go back 30 years and try to name a corporate CEO, you wouldn't have had a clue. They did a lot of other things behind the scenes that weren't noteworthy or pressworthy. They've become more PR people now, I think, than true managers."
Jefferies' Hogan says that the balance between what you need to present publicly as a CEO and what you need to do privately has been upset. He argues some CEOs spend more time making public appearances than running a business.
"We've clearly moved beyond the environment where celebrity CEOs work," said Hogan. "We're moving more to an environment where a CEO has a lower profile and a better finger on the pulse of the current business environment. That's what is appropriate."
Put Me In, Coach
And yet, despite failing to drastically improve Chrysler or Home Depot's position, Nardelli continues to be viewed by some as a hot commodity, an experienced leader, a man who can take on the role as turnaround expert.
Passed over as the successor for then-CEO Jack Welch at
, Nardelli famously received a phone call from Home Depot Chairman Ken Langone right after resigning. Only eight months after leaving the retailer, he was given to keys to run Chrysler. One has to wonder how long Nardelli will remain an adviser to Cerberus before another company picks up the telephone.
If analogies work best, Nardelli's journey isn't much unlike that of a sports manager or coach who gets recycled by several professional teams, yet doesn't have much success in the position. Think Wade Phillips, Dusty Baker, Norv Turner, Marty Schottenheimer, Rick Carlisle or Don Nelson.
Just as football fans are worried which team will hire Herm Edwards now, should we dare ask who will see value in Nardelli next?
"He's gone from diversified industrial to retail to autos. The only thing he hasn't touched is health care and technology," Nolte joked. "Maybe an airline."