Evaluation of Bob Nardelli Leadership Frames Applied at Home Depot

Home Depot employees and shareholders may not have been a fan of Bob Nardelli’s leadership style, but his single frame behavioural approach to leadership was one of the main factors for turning the company into an “earnings juggernaut”. Nardelli took on a structural approach when he moved from GE to Home Depot. He was a task-oriented CEO who focused on setting goals that he accomplished by any means necessary, rather than keeping up employee morale. It was evident from the start of Nardelli’s tenure that he was fixated on the company’s numbers. Even Home Depot Co-founder, Kenneth Langone, stated that he “is maniacal about goals, objectivity, accomplishments within the boundaries of the values of the company. ”

From a leadership perspective, this style can be effective when used in the right situation. Nardelli made it clear to employees that everyone had specific goals and were expected to meet their numbers. This is an example of how he started to structure the work of individuals. If employees were unable to meet his demands, he would replace them with more specialized managers to create a more efficient working environment. Nardelli ensured that these replacements were specialized as 56% of all replacements were hired from outside companies. He also set another goal to reduce expenses and created a cost-cutting program to do so. Although he replaced many full-time workers with part-time workers, Nardelli was able to significantly reduce costs and increase the company’s gross margin by 3. 8%.

Over his tenure, he also took on the role of an institutional architect by moving Home Depot into a new direction. Nardelli wanted to diversify Home Depot’s operations by creating Home Depot Supply, which provided a service to homeowners and helped to boost the company’s revenue. This was a major move for Home Depot, but it turned out to be a success since now approximately 15% of all revenues came from this service. This is a similar frame to the one used by Muhtar Kent at Coke when he was trying to grow the brand more into Africa. He was mainly focused on how to grow and set goals regarding the amount of Coke he wanted to see the continent consume per year, the amount of money he wants to have invested in developing countries by 2020 and trying to keep Coke “cold and close” to consumers to increase sales. In conclusion, it is evident that the use of a single leadership frame can be effective if you are looking specifically at the numbers. Using just the structural leadership frame, Nardelli transformed Home Depot into the retail giant that we know today.

In Nardelli’s case the structural leadership frame helped to turn Home Depot into the giant retailer it is today, but it was at the expense of lowering employee morale. Nardelli should try to adopt an HR frame along with this to ensure he is putting emphasis on the needs of his employees, which would most likely result in higher productivity around the company and could increase his numbers without extreme cost-cutting. Bolman and Deal mention in their book, Reframing Organizations: Artistry, Choice and Leadership, that a good leader will change their leadership frame based on the organizational challenges that arise. If a leader stays in one frame, they risk getting stuck in the status quo and could be forced to resign like Nardelli. By continually assessing new challenges and changing leadership frames, leaders will become more efficient and effective in their daily work and will be less likely to get stuck. In conclusion, all frames can lead to long-term success as long as the leader uses different frames depending on the challenges that arise.