Out at Home Depot

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After the announcement of Nardelli's leaving, a source familiar with Relational called the departure "a positive" but added that "the major strategy, capital, and management issues remain. Fresh new blood remains an objective."

Happy Hour at Noon

It wasn't only activist investors like Relational that had grown tired of Nardelli's leadership. He irritated Atlanta locals, too. In a Nov. 25 letter to Nardelli, reviewed by BusinessWeek, A. Leigh Baier, an Atlanta attorney and Home Depot shareholder, requested that the company's board include a "nonbinding" resolution in Home Depot's proxy statement allowing shareholders to vote on whether "they are in favor, or opposed to, the board of directors of Home Depot terminating your contract." Explaining his now-moot proposal, Baier says, "You can't s--t on your employees and deliver" results.

Others remain outraged, even with Nardelli gone. A group of unions whose pension funds own shares in Home Depot plans to challenge his $210 million payout at the annual meeting in May. Meanwhile, in Washington, Representative Barney Frank (D–Mass.), the incoming chairman of the House Financial Services Committee, said in a statement on Jan. 3: "The actions of Home Depot's Board of Directors to simultaneously dismiss Robert Nardelli and provide him with $210 million in severance is further confirmation of the need to deal with the pattern of CEO pay that appears to be out of control."

It's unlikely Home Depot's new chief executive, Frank Blake, will change the Nardelli-driven demand for data and centralized control. A former Deputy Energy Secretary and GE veteran, Blake played a key role in executing Nardelli's strategy at the retail chain. But company executives say he lacks Nardelli's sharp edges and prefers to build consensus rather than dictate orders. While Blake is an unknown to many Home Depot employees, the Nardelli departure was already brightening the mood at some company stores. "It's amazing the reaction of people on my floor. People are openly ecstatic. High-fiving," said an Atlanta store operations manager only hours after the Jan. 3 announcement. "There's a group talking about going to happy hour at noon."

Corporate America hasn't seen the last of Bob Nardelli, however. According to people familiar with the situation, while store workers were celebrating, the former CEO was already fielding calls from private equity firms interested in his formidable operational talents. The bright side for Nardelli in the world of privately owned corporations, of course, is that he won't have to deal with any annual meetings or shareholder questions.

Grow is a correspondent in BusinessWeek's Atlanta bureau. With Dean Foust in Atlanta, Emily Thornton, Roben Farzad, Jena McGregor, and Susan Zegel in New York, and Eamon Javers in Washington