Home Depot Undergoes Painful Transition Under Executive's Advance.

Byline: Patti Bond

Dec. 8--Steve Moody moved steadily up the ranks at Home Depot by thinking on his feet and adapting to change.

When Moody found out two winters ago that longtime General Electric executive Bob Nardelli was taking the helm at Home Depot, his gut told him to get ready for a revolution.

Moody was manager of Home Depot's store near Vinings at the time. He ran out and bought "Jack Welch and the GE Way" and devoured the book.

The homework paid off. Nardelli, dubbed "Little Jack" during his days at the right hand of GE's legendary chief executive, was bred on the GE doctrine: Weed out defects and crank out hotshot managers.

Nardelli's father was a GE man, and then he put in 26 years of his own at the company.

"I told my people at the store, `If you want to know what's coming, you better read the book, 'cause I'm telling you, this is where we're headed,"' Moody recalled.

Sure enough, Home Depot's orange-aproned crew has gotten a heavy dose of the GE way. Nardelli wrapped up two years at Home Depot's helm last week, and change has been a nonstop theme almost from Day One.

Nardelli turned the chain of command on its head, switching the bottom-up flow to a top-down approach from headquarters. He whacked a layer of management. Then he set out to measure the performance of everything that can possibly be measured -- even employee morale.

But of all the changes, the one the workers in the trenches felt most profoundly was Nardelli's commitment to abandon the freewheeling management style instilled by co-founders Bernie Marcus and Arthur Blank.

For two decades, Marcus and Blank gave managers the freedom to make their stores work whichever way they felt was best in their locale. That's the opposite of GE's management-as-science way, and Nardelli replaced it with an onslaught of new corporate policies and procedures, all in the name of accountability, discipline and structure.

The 180-degree turn has been a jolt for a generation of Home Depot veterans hooked on the company's feisty entrepreneurial spirit. Like kids with a new stepdad, some had a tough time adjusting to the new guy.

Many of them have left the company …