This post is written as part of AOL Money & Finance's Best & Worst 2006. Vote for Bob Nardelli or check out the other overpaid CEOs.

Former General Electric Company (NYSE: GE) executive Bob Nardelli lost out to Jeff Immelt in the race to succeed Jack Welch as CEO. And The Home Depot Inc. (NYSE: HD) shareholders would have been better off if Nardelli had repotted himself elsewhere.

Since Nardelli joined Home Depot as CEO in December 2000, HD is down 40% compared to a 120% increase for competitor Lowe's Companies Inc. (NYSE: LOW). In the last five years, Home Depot's revenue grew at a 12.3% compound annual growth rate to $90.1 billion and its net income increased at a 17.7% annual rate to $6.1 billion -- not bad, but a far cry from Lowe's 18.2% revenue growth and 27.8% profit growth during the same period.

And all this inferior performance at Home Depot would not be so bad if Nardelli weren't so egregiously overpaid. He received roughly $30 million in 2005, almost six times the $5.5 million that Robert Niblock, Lowe's CEO, took home in 2005.

Investors in the market for bargain CEOs should stay away from Home Depot.

Peter Cohan is President of Peter S. Cohan & Associates, a management consulting and venture capital firm, and a Professor of Management at Babson College. He owns GE stock and has no financial interest in Home Depot or Lowe's.

The Home Depot Inc's (NYSE:HD) CEO Robert Nardelli has been under fire recently for what is considered by many to be an exorbitant pay package. CEOs these days routinely receive millions after millions (even with horrid performance) in pay while constantly battling to run their companies in a fashion that constitutes consistent and growing performance.

A director on Home Depot's board has stated, though, that the Home Depot board has made no decisions yet on what the compensation package for CEO Nardelli should look like. "We are continuing our review and have made no decisions," according to Bonnie Hill, head of Home Depot's leadership-development and compensation committee. The committee will be meeting later this month but may not have completed its study into the CEO's compensation package by then. Don't look for any suggestions for change until 2007.

Nardelli, who is known to run his company like a military establishment, has made enemies of several former managers and employees that state the CEO makes life just too hard to work at Home Depot. Home Depot has thrived under the management style of Nardelli, although that style is wearing quite thin with many employees and managers.

However, the word "thriving" may not sit well with many institutional shareholders, who have been unhappy that Home Depot's share performance has been lackluster in their eyes since Nardelli took the job in December 2000 -- while Nardelli has earned more than $150 million in compensation up to now. If you own HD, is that a nice return on investment?

Home Depot's Board of Directors will soon renovate CEO Bob Nardelli's rather large compensation package. Mr. Nardelli took over as Home Depot CEO in December 2000. His compensation since then has averaged about $50 million per year. When Mr. Nardelli took over, Home Depot stock was at $40.19; and the stock closed at $36.58 on 18 September 2006. During Mr. Nardelli's tenure as CEO, the share price of Lowe's, its main competitor, has gained 178%.

According to Bonnie Hill, Home Depot's compensation committee chair, Mr. Nardelli's pay package will be reconfigured if only to quiet shareholder outrage that the CEO continues to profit handsomely while investors do not. At Home Depot's annual meeting in May, shareholders withheld 30% of their votes, including votes for Mr. Nardelli.

Currently, the bulk of Mr. Nardelli's pay package is tied to the financial performance of Home Depot, NOT stock performance. Fair is fair. On Mr. Nardelli's watch, Home Depot's sales have increased from $45.7 billion in 2000 to $81.5 billion in 2005.

Still trying to recover from self-imposed wounds from the annual meeting debacle, Home Depot senior management is schmoozing with Wall Street as well as investors. CFO Carol Tome presented a version of Home Depot's strategic plan at the recent Goldman Sachs Global Retailing Conference. CEO Bob Nardelli has recently made himself available for media interviews. Bad publicity had reached such high levels that Home Depot did the previously unthinkable. Nardelli called HD founder and huge shareholder (at one point as many as 59 million shares) Bernie Marcus so he could say something nice about Nardelli's job performance. What Marcus said is what everybody but Nardelli already seems to recognize. Customer service is inconsistent at Home Depot stores, often bordering on abysmal. Touting various customer service initiatives such as the $30 million "Orange Juiced" program, or bragging about 5.5 million employee hours in stores for the second half of 2006 are meaningless to customers who cannot get the information and/or products they need when they are standing in the store. Lack of money is not Home Depot's problem. Lack of a customer-centered corporate culture is.

Home Depot senior management is trying to make strategic decisions. Nardelli recently announced that 300 jobs at the Atlanta HQ will be cut. But since it is not clear what those job responsibilities entail, it is equally unclear how this move will help improve the shopping experience for consumers. Recognizing the need to revamp its own corporate culture, Home Depot recently decided not to expand in Europe by acquiring Kingfisher, a UK-based home improvment chain. CEO Nardelli has indicated repeatedly that the SEC investigation into how the company accounts for stock options will have no negative material impact on Home Depot's finances. Home Depot caught a break in Chicago. Mayor Richard Daley vetoed a city council living-wage resolution that would have forced Home Depot, Wal-Mart and Target to pay up to $13 per hour in pay and benefits.

During the month of September, Home Depot intends to provide a national home show in more than 1,000 stores. Celebrities from home improvement shows will lead a number of how-to clinics. Vendors will offer in-store demonstrations of innovative products designed to save money and be energy efficient. There will also be interactive online workshops, and a virtual home tour specifically designed to show case brand new products.