by Kim S. Nash

Chrysler Hires Nardelli as CEO. What Does it Mean for the Carmaker’s IT?

Aug 08, 20073 mins
IT Leadership

In January, as Home Depot shareholders seethed, Bob Nardelli took a $210 million exit package and resigned as CEO. Now he’s landed the CEO job at Chrysler.

The troubled carmaker is newly private — investment firm Cerberus announced in May it would buy Chrysler — so Nardelli doesn’t have to contend with angry public stockholders, at least.

Scrutinized this week are some of Nardelli’s career milestones. He came up through GE’s fabled management ranks, only to get passed over for the top slot when Jack Welch retired in 2001. Nardelli read the writing on the wall and left GE in 2000, before Welch did. He hopped over to lead Home Depot, only to see its stock drop to $39.70 per share when he left — down 10% from the $44.22 it traded at when he started.

Whatever Nardelli does and doesn’t accomplish at Chrysler, he’ll be one of the most watched CEOs alive. Rightly so. He’s got a reputation as a chief who knows I.T., having pushed Home Depot’s controversial move into self-checkout technology and hired Bob DeRodes as Home Depot CIO to impose order — namely, metrics — on the technology team there.

Information technology may or may not help Chrysler now. The company’s problems mainly stem from pension demand from retirees, health care costs and expensive unionized labor, according to CNNMoney.  

Meanwhile, Toyota earlier this year became the biggest car company on the planet, in terms of sales, in part thanks to smart, effective application of information technology. Barbara Cooper, CIO of Toyota, will be inducted into our Hall of Fame in October.

I’m wondering how long Sue Unger, longtime CIO of Chrysler, will work under Nardelli. Unger has created Chrysler’s “digital factory” for building virtual assembly lines and testing new-car design ideas. She’s also known for innovation in both I.T. and finance and won the Automotive Hall of Fame’s Distinguished Service Citation last year.

Alex Taylor, who has covered the car industry for years for Fortune magazine, thinks Nardelli is the wrong guy for the job, on Monday writing that Nardelli:

“…arrives on the heels of an enormous fiasco at Home Depot, appears to have a very high psychic profile, and by all accounts has the tact of a Marine drill instructor. This is not precisely what Chrysler needs at this point…”

Taylor says Chrysler would do better to find a leader without Nardelli’s “hard-charging” and “aggressive” style.

On Chrysler’s corporate blog, VP of communications, Jason Vines, defended Nardelli: 

“A fresh set of eyes from outside the industry can find new and better ways of doing things. Our owners at Cerberus think Bob’s incredible track record in successfully running the many businesses he did, at General Electric and on the retail side of Home Depot, can speed up the recovery of The New Chrysler. Everyone’s future at Chrysler—our employees, our dealers, our retirees, our supplier partners—rests on a sustainable recovery. We know that.”

We know it, too, and we’ll be watching.