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Former Home Depot chief executive Bob Nardelli exemplifies some of the biggest rules of leadership:
Be visible (and invisible). Nardelli plays a role in the “board cutting” ceremony that launches every new project and store. He also spends at least one week every three months as a “mystery shopper,” anonymously checking out up to 10 stores a day. At first, employees thought he was out to catch them doing something wrong, but eventually, they figured out that he just wanted to see things as a customer.
Base decisions on the numbers. Nardelli uses his background in the metrics-obsessed culture of General Electric to measure what’s important. Example: Home Depot started tracking the average purchase per customer and raised it by 18 percent over five years, to about $58.
Impose discipline. In his first two years, along with centralizing merchandising and creating other back-end efficiencies, Nardelli also instituted a performance-management system that scared off a lot of his independent-minded store managers. Those who stayed benefited: Sales grew from $45.7 billion five years ago to about $80 billion last year.
Understand people. Example: Nardelli notices who turns out for Home Depot’s charitable activities.
“People who volunteer are usually your best associates,” he observes.
Execute. When Nardelli arrived at Home Depot five years ago, the company’s technology worked so badly that he couldn’t even send out an e-mail to the stores. Result: He rolled out a $2 billion technology project.
“He really is the best manager, execution- wise, I’ve ever encountered,” says former boss Jack Welch. “His real ability is to motivate lots of people around a mission, excite them about it and make it happen.”
—Adapted from “Bob Nardelli is watching,” Jennifer Reingold, Fast Company.