Oct 14 Promoted to CEO just two weeks ago,
Michael Woodford was a star at Japanese camera and endoscope
maker Olympus Corp , where he joined as a salesman in a
British subsidiary more than three decades ago.
His bosses were so impressed by the Briton's cost-cutting
efforts and deep understanding of the local culture that they
made him CEO, adding to the role he took in April of President
-- the first non-Japanese to run Olympus.
In a glowing tribute on his appointment, the Board's
Chairman said Woodford's change initiatives had an "extremely
positive effect" and Olympus praised him for showing "great
sensitivity and understanding of the different cultures."
On Friday, the same board fired the self-confessed
"loud-mouthed" and "strong-headed" executive, saying he had
shaken up 92 years of the firm's management culture.
The announcement marked an astonishing fall from grace for
someone only months into his role as president and week's into
his role as CEO.
When Olympus appointed Woodford as CEO, it said the board
had been "extremely pleased with progress under Mr. Woodford's
leadership in this role (president), which has exceeded the
expectations at the time of his appointment."
It was also surprising because Japanese boards rarely fire
top executives and the status quo is encouraged.
Woodford was credited with successfully cutting costs in
Olympus' European division. Born in the English city of
Liverpool, Woodford joined KeyMed, a medical subsidiary of
Olympus in 1980 after working for Schweppes.
The British Chamber of Commerce in Japan, which put Woodford
on the cover in its latest issue, quoted the straight-talking
executive in an interview as highlighting the difficulties of
instigating change in Japan's corporate culture.
In a rushed news conference on Friday, Olympus Chairman,
Tsuyoshi Kikukawa, said: "We hoped that he could do things that
would be difficult for a Japanese executive to do."
But the Olympus board said Woodford "has largely diverted
from the rest of the management team in regard to the management
direction and method and it is now causing problems for
decision-making by the management team."
Woodford's exit spooked investors and the shares plunged
nearly a fifth of its value. Brokers were quick to cut their
ratings and earnings estimates.
Woodford told Reuters in May he would cut jobs at the
35,000-strong workforce to achieve his mid-term cost targets and
reverse a slump in earnings while avoiding forced redundancies
in Japan for cultural reasons.
"Companies, particularly when there are good times, put on
corporate fat," he said. "Sometimes, the strong yen, the
disaster or other things focus your mind," he added, referring
to the March 11 earthquake and tsunami that struck northeastern
Woodford, who left Japan three days before the earthquake,
rushed back 10 days later, despite an environment of fear and
uncertainty and some opposition from his family.
"I came over on an ANA flight and I was the only Westerner
on the plane. Before we landed, the air hostess got me eight
bottles of water, and I was thinking-what have I got myself
into?," he said in the interview with the British Chamber of
Commerce in Japan.
Woodford lives in a new large apartment complex next to one
of the biggest parks in central Tokyo in an upscale neighborhood
favored by expatriates. Efforts to contact him were unsuccessful
Some comments on the Internet pointed to Woodford's exit as
symbolic of Japan Inc's slow attempt to change.
"Mr Woodford failed to understand that efficiency,
modernization, speed of implementation, shareholder value and
change are not the Japanese way of doing business, so he had to
go and we will replace him with a clone of the former Japanese
CEO's so we can go back to the old ways," read a post under name
of tokyokawasaki on website japantoday.com.
(Additional reporting by Isabel Reynolds and Tim Kelly in
TOKYO; Editing by Neil Fullick)