Olympus ousts British CEO after 6 months due to conflicts

nigelboy; Care to elaborate on your Oct 15th post?

This is Japan... "The nail that sticks out gets hit on the head"...

Sounds like the guy never had any meetings. But then again, if he met with people that were clueless in English, the International language of the world, then he made his own decisions. Sounds fine to me and I would have done the same if there was no communication.

Pointing at your nose and saying disu izu pen does not cut it.

Mr Bird; Correct. One poster is using the "G" word in a racially offensive manner and it is sad that moderators allow it as it lowers the tone of this site.

Sorry but just by using the word "gaijin" in this argument you are simply confirming the stereo type! The culture of us and them!

seesaw,

in the 90s I knew a guy like you, he was in sales, quickly was racking up 60+% of the companies figures BUT he never go summer or yr end bonuses, while the deadbeats around him did, was really bad, he worked out a deal to make some of his overtime & production into holidays(paid), they agreed on a day to do the math, on that day the prez blew him off, next day he submitted a request for 3mths off, walked out never came back, had 2 European customers hound him to come work for them so he & family went to Switzerland, wasnt paradise but they liked it.

The J-company quickly lost most of the customers he gained them, was stupid beyond belief, but I dont seem much of J-Inc having the nads to change much, we are in for a lot of rot sadly

Your "smart gaijin brains" way of drasticallyt cutting costs (labour, R&D, etc.) would probably help companies incease their profits, dividends and executive compensation for several years, but it's not smart at all in the long run.

rarara: Can you find a better way to do things? If you are an Employer would you still want to keep those useless unproductive elderly in your organisation and keep allowing them to main a good lifestyle? I would rather pay someone who could come up with productive ideas.

It is not because "gaijin" brains are superior. But thinking is needed that has not been formed and limited by the very things that are most in need of change.

Yabits: I completely agree with you. Even if the J employees spent time and money to 'skill up' themselves through various seminars, coaching sessions, they eventually go back to their companies and do nothing. Because why? they can't afford to be different. Not especially in this economic situation.

J Inc needs people who dare to be different. Olympus needs someone who dare to be different. And Mr Woodford had done that big favour for them.

@Munya

the board of directors have already had a well laid alternative plan for the bankruptcy liquidation of the company

Huh? Olympus going bankrupt??? Or is this just a complete figment of your imagination? (rhetorical question)

if your "smart gaijin brains" are so good, why your countries need to keep borrowing unsustainable amounts of money from Japanese, chinese, arabs, etc., while resourceless, overpopulated japan still enjoy current account surplus in spite of the frequent huge earthquakes,tsunami (more than 40.5 m (133 ft) in some places and up to 10 kilometres inland in sendai) and resultant nuclear disaster (which also caused severe electricity shortages) as well as the need to import all kinds of over-priced natural resources ? why do you think your countries are debtor nations while overpopulated, resourceless, disaster-strickenJapan is still the world's top creditor nation, with by far the largest NET external assets in the world? Why do you think yen's value has risen from around 360 yen per dollar/1000 yen per pound to the current levels of around 80 yen per dollar/ 120 yen per pound over the past few decades, to the great disappointment of Japanese exporters ? Your "smart gaijin brains" way of drasticallyt cutting costs (labour, R&D, etc.) would probably help companies incease their profits, dividends and executive compensation for several years, but it's not smart at all in the long run.

If Japan Inc wish to improve themselves, they really need to take advantage of smart gaijin brains. Because why...? the Japanese employees can't think outside the box, can't be different, can't be the perfect leaders.

It is not because "gaijin" brains are superior. But thinking is needed that has not been formed and limited by the very things that are most in need of change.

I think any non-Japanese who has worked in Japan has experienced the phenomenon of the exercise of power and decision-making not around what is right but on who said what and how do we build consensus around that, no matter how misguided it seems. It seems clear that the senior staff who picked Woodford didn't spend any time finding out if he could actually work within the system they wanted him to.

However, if he's doing his job as a CEO, and finds that some of the problems with the company lie with the senior executives and their cohorts at an upper management level, he would not be doing his job if he just knuckled under and bit his tongue for very long.

I recall that when General Motors bought EDS, they thought they were getting a real plus having H. Ross Perot joining their executive team. Much to their chagrin, Perot wasted no time bluntly telling them that the problems with GM started right at the corner office. They had to get rid of him, and quickly. Had they been able to swallow their pride and work with Perot, I believe GM would have been in much better shape as a corporation.

Yet, Sony's performance has been a really horrible downward spiral over the past several years under the reign of Howard Stringer, while the situation is even worse at places like Shinsei Bank.

rarara: Mr Stringer was probably full of brilliant ideas, but he's smart to understand his job was to be a puppet. and that's what's it's all about.

If Japan Inc wish to improve themselves, they really need to take advantage of smart gaijin brains. Because why...? the Japanese employees can't think outside the box, can't be different, can't be the perfect leaders.

LOL. I am sure the brains of British/American top executive of Sony, Shinsei, etc. are not so bad as yours.

rarara: Mind you, I was responsible for upgrading a large J Corp's clientele, turning around the sales results and not to mention bringing in an International business culture to them .....and I didn't them all with patience because the money and package were so excellent I couldn't refuse.

And my former Employer lost 90% of what I created for them....and the earthquake made it worse.

Well, at least, I'm not just a woman sitting at my computer, writing comments all day/night long....

" Since June 2005, Stringer has been Chairman and CEO of Sony overseeing the entire businesses of the company. This period coincide with the period of their downfall. And in April 2009, he also assumed the post of president as well, and the horrible downward spiral seem to have been accelerating since then."

Can sense the subtle & polite comparison coinciding Mr. H. Stringer's appointment with Sony's downward spiral -- that may well be explained by a company's life cycle ? Employees would have been sitting on the past success & established strong brand power -- eagerness to innovate starts to fall ?

Can also imagine the cultural shock in appointing a Gaijin CEO within a traditionally ~100% Japanese organization -- this is exactly the cultural shock needed to bring new spirit, new thought & new way of doing things. Nobody is perfect, if those Japanese companies that cannot even accommodate a few Gaijins, not sure how these companies could sharpen themselves to face the on coming challenges ( globalization ) ?

"T_rexmaxytimeOCT. 15, 2011 - 10:50AM JST I think Nissan is a good example of a revived company under a foreign CEO. Sony... not so much..."

There is a difference : Mr. Carlos Ghosn was not a simple employee but the mandatory boss who used to be the boss of French Renault that acquired a ~44% stake of Nissan ( vice versa in an alliance ) when the latter was in difficulties. Howard Stringer & Michael Woodford are simple employees who were brought to the top job.

Ironically, Michael Woodford, an apparently be-trusted manager ( employee since 1981 & praised with above-average performance etc ) can be ousted over night ! Successful leaders donot need window dressing practice by putting one or two 'puppet' alien faces on the board -- example, Samsung Electronics employs plenty of international talents at their headquarter that may be the reasons behind its success in surpassing Sony.

yabits: Sony, by the way, was on a downward spiral before Stringer

i am not sure. Since June 2005, Stringer has been Chairman and CEO of Sony overseeing the entire businesses of the company. This period coincide with the period of their downfall. And in April 2009, he also assumed the post of president as well, and the horrible downward spiral seem to have been accelerating since then. and, "resourceless" means that overpopulated Japan has to import all kinds of overpriced natural resouces, oil, iron ore, copper, etc, etc. whose prices have risen considerably in recent years. As a matter of course, you are right in referring to the "tremendous human resources" of Japan. It's exactly why resourceless, overpopulated japan still enjoy current account surplus in spite of the frequent earthquakes, huge tsunamis and resultant nuclear disaster, as well as the need to import all kinds of over-priced natural resources. It also explain why Japan is still the world's top creditor nation, with by far the largest NET external assets in the world, and why the Yen's value has risen from around 360 yen per dollar/1000 yen per pound to the current levels of around 80 yen per dollar/ 120 yen per pound over the past few decades, to the great disappointment of Japanese exporters.

why do you think resourceless, overpopulated japan still enjoy

You keep repeating the word "resourceless" as though it were a fact. Japan is not resourceless. They have enjoyed the benefits of tremendous human resources in rebuilding and attaining success after the War. In an information-based world economy, human resources matter more than natural resources. So let's cut the crap, shall we?

Sony, by the way, was on a downward spiral before Stringer.

There's a saying: "Nothing fails like success." I believe it applies to the Japan of today as it looks to its future.

seesaw1: our brains to help them out

LOL. I am sure the brains of British/American top executive of Sony, Shinsei, etc. are not so bad as yours. Yet, Sony's performance has been a really horrible downward spiral over the past several years under the reign of Howard Stringer, while the situation is even worse at places like Shinsei Bank.

why do you think resourceless, overpopulated japan still enjoy current account surplus in spite of the frequent earthquakes,tsunami (more than 40.5 m (133 ft) in some places and up to 10 kilometres inland in sendai) and resultant nuclear disaster (which also caused severe electricity shortages) as well as the need to import all kinds of over-priced natural resources ? why do you think overpopulated, resourceless Japan is still the world's top creditor nation, with by far the largest NET external assets ?

Cut off the craps...I think Japan is going to crumble if they don't start accepting 'outside' brains. Every industry is falling apart these days and they need our brains to help them out. It's really not the time to be snobbish dear Japan Inc.

No Mr.Bird. This isn't about a Japanese company not being able to accept a European approach. Kikukawa was just being diplomatic when he cited cultural difference as a factor when in fact, it was just a case where an individual just went on a power trip.

When the Board required you to work in Japan for 80% of the time, you abide by it. When you want to implement you directives, you turn to the individuals who are one step beneath you which are usually Dept heads. You don't try to drastically cut R&D which is the core foundation of the company without consulting with the board. This isn't cultural. The only cultural aspect that was seen here is that he wasn't given a pink slip like most US/Europeans companies would have done.

Having observed both sides of the story, I'd say most Anglo-Saxon Companies are a lot more accommodating and understanding of Japanese Culture, than a lot of Japanese Companies are of any other culture, not just Anglo-Saxon! We are talking here about a Japanese company not being able to accept a European's approach to running a company.

On the other hand, if you take Japanese companies out of Japan itself, it's a different story - particularly here in the UK you will find a lot of Japanese Companies getting on very well - Honda, Nissan, Sony etc etc, the Factories work very well here and are some of the best in this country, mixing both English & Japanese management and work practices is a recipe for success - one learns from the other.

I'm not saying Japanese companies are wrong, I admire much of the Japanese approach to business, but the best approach is too accept that each culture does not have the only view on the world.

From the article above it looks as though the Japanese management of the company ultimately could not accept a non-Japanese approach to it's business. Interestingly in the article Mr Woodford's side of the story has not been quoted, only the Japanese management's view?

Mike Bird: When are Japanese companies going to accept that their Japanese perspective is not the only view of the world?

When are Anglo-saxons going to accept that their perspective is not the only view of the world?

When are Japanese companies going to accept that their Japanese perspective is not the only view of the world?

Bogart: Gyrus.... Cayman Islands company called AXAM

even an outsider like myself heard of it long before Woodford was appointed president. more interesting question would be why this british chap suddenly decided to take up the issue now.

According to a front page article in todays FT it seems likely that Mr. Woodford was fired for raising questions about more that $1 billion in payments made by Olympus to shadowy third parties. In particular the Gyrus case in which documents show that Olympus paid $687 million to a Cayman Islands company called AXAM that had been named as a financial adviser. The company disappeared from the trade register 3 months after receiving the final payment from Olympus.

Sounds like Olympus has lot of explaining to do to its shareholders. Perhaps those attacking Mr. Woodford are now ready to eat humble pie.

No comment on the guy.

But an observation from when we moved users from main-frame terminals onto Pc's. Actual productivity slowed as most were focused on Pc functions to create better presentations, ecv. Also probs for us IT guys increased and I haven't a change in 3 decades to the trend. Actual security went down the drain and we ain't seen it for decades.

IMO, the only thing today about smart-phones today are the phones and not the users. Heck even most appli cater for the lowest denominator now.

Even back 20, etc yrs ago we knew that users used less than 10% of the powers that computers gave them.

For nearly two weeks prior to his visit, nearly all other work would be dropped while the entire office would devote itself to making PowerPoint slide-shows with nice pie charts and graphs to explain why we weren't doing all that well.

I have seen this in every company I have worked for (Japanese and British owned) with regards to people from head office coming for a visit AND schools with regards to parent observation. It is pathetic and a waste of time. If people were doing their jobs properly, they wouldn't need to panic and fake things (like student reports, lessons, business goals, missed targets) as they do. A stitch in time saves nine but here?? Nah. Why do now what you coul ddo later and panic about it.

This guy probably is an arrogant jerk - name me someone at his level who isn't (perhaps except Jobs). They get ahead because of their manner. He probably ran into a few bulls here who refused to let him do his job - you know, the gaijin way. As someone else said, hired to fail Wouldn't be the first gaijin this has happened to, certainly won't be the last.

Lots of companies know well where they are bleeding cash here, where they need to improve efficiency but they just cant get themselves to do anything, they wud rather crash & burn than try to fix much of anything, so few shud be surprised this dude failed, he never really had a hope in hell of making any headway in Japan

GW -- exactly. Because they know they can just join the long list of other zombie companies being supported by bank loans -- from banks that own their stock -- and, if that fails, be bailed out by the government. Just look at how much bank lending goes to companies that are already way too much in debt.

It's difficult to compare the 3 individuals, Woodford, Stringer, and Ghosn. They are in different environments altogether. So like any science experiment it's just a matter of observation and noting the variables.

For now, lets just say that racism is the most difficult variable to prove exists.

Stringer and Ghosn are not always on Japanese soil. Of course, they go back and forth. Spending a week here a week there but one thing's for sure. They don't live here. They're not going to run into any of the board members at the supermarket.

IMO, it's one thing if a company employs foreigners. It's another thing if the company employs foreigners and puts them in the same neighborhoods as their colleagues and customers. I'm sure you will agree that companies here in Japan with a boatload of foreigners provides domiciles for them. Don't believe me? Fujisawa was a perfect example for the Kanagawa area. I could visit all my American and British friends in 2 hours. They were all in the same building.

Japanese give about the same hospitality level as Mr. Rogers. "Hi There Neighbor" very polite. "Now get the -cough- out my neighborhood".

Woodford was at the helm HERE......HERE in Japan. I wonder if he used English.....that's a No No.

That's the difference I see. I get that look sometimes. I drive a luxury car.....here in Japan.....I get a look that says "How the hell are you doing better than me in my own country?" That's just not supposed to happen. Unfathomable!! Woodford became the CEO. A foreigner!!! OMG!!! Anyone who denies the possibility that their egos weren't bruised can eat those Sour Grapes.

The Japanese way of bringing a foreigner down is passive bullying. All agencies are involved and it's like sticking pins in a tomato pin cushion. Well, they really stuck it to this guy Woodford. It's easier to pull jealousy and hatred than it is to spew it all by yourself.

There are many in this society who miss the bubble economy. Their egos were satisfied daily. Sounds like Woodford ruffled a few feathers and in backroom meetings they plotted against him. We all have our ways of doing things but that's no reason to oust the man so quickly. Sounds like these bigwig executives are very complacent and have no intention of supporting anyone who's willing to shake things up even if it's for the better.

In the U.S we call such people Republicans.

Seems likely to me head office LOVED how he cud make changes & bring in the ca$h but when he suggest ways to do so in nippon he promptly hit the brick wall, hardly surprising.

Lots of companies know well where they are bleeding cash here, where they need to improve efficiency but they just cant get themselves to do anything, they wud rather crash & burn than try to fix much of anything, so few shud be surprised this dude failed, he never really had a hope in hell of making any headway in Japan

the reality would be this british chap was employed by Kikukawa (also ex-salesman) as his gaijin puppet., but he was not clever enough to understand his real role (Chaiman Kikukawa's illiterate gaijin puppet ). really absurd.

I absolutely agree with this comment. If Woodford had just enjoyed being a 'guest' in a J Corp and rub the Shortie's butt he could be sure a life in paradise after retirement.

Look at all foreign GMs at 5-star hotels. All they do is just kiss butts and stand around looking gaijin in the hotel lobby. Some even have extensive social life of having different J women in their hotel residence every day....:)

Woodford should have been 'smarter'.....

I think Nissan is a good example of a revived company under a foreign CEO. Sony... not so much...

Its rediculous to have assessed his performance in 6 months. If he's such a failure, then those involved in his selection must go too.

Ah_so: Sony is the exceptional example of a foreigner prospering in a Japanese company.

Has that something to do with Sony's horrible downward spiral in recent years both at home and abroad, especially under the reign of Howard Stringer ? (although I actually tend to think that Stringer is also a kind of gaijin puppet used by some japanese puppeteer)

Let's think about why so many great British companies fail here but succeed everywhere else. Boots, Tesco, Pret a Manger, Vodafone and soon to be HSBC and many more. It is because of the Japanese way.

Not just British companies - almost all attempts to access the mass market by foreign firms fail, but that does not stop some CEO every few years thinking they will have a crack at the Japanese market and totally failing.

In much the same way, I would never advise anyone to work for a Japanese company - Sony is the exceptional example of a foreigner prospering in a Japanese company.

Some people, when elevated to the position of CEO, loose their control and reason. Their ego soars. They cease to respect the rights of shareholders, functionaries and workers. They make silly and megalomaniac decisions. They contrive tricks to get control over the company. I do not know if this happened here, but when it happens the company must mobilize the courage and the strength to kick such a person out, if it wants to survive.

Woodford represented some clarity of what might happen going forward with cost reduction. Removing him and putting a board member in place doesn’t provide any clarity towards what might happen next. There’s no indication of what, if any, decisions Woodford was making might be unwound, or what new decisions might be made. The change indicates that there was a problem that wasn’t visible to the public, but the description of that is vague. In short, Olympus appears directionless to investors at the moment. Investors don’t like directionless.

The question is should Olympus shed the camera division since it really does not fit well with the rest of the core money making products of the company. Japanese management answer would be “very difficult”. If you lived and worked in Japan you will know what that means.

nigelboy:

The very same board that selected him had to get rid of him so quickly. What does that tell you? ---The Board of Directors, especially Kikukawa made the wrong choice. From reading various sources (Nikkei, mostly), it appears Woodford attempted to drastically cut R&D expenses

right. drastically cut things like basic R&D expenses so that the company's profits, executive compensation, dividend rise in the short run (a few years) .----stereotypical gaijin management. and, as i wrote earlier, many people suspect that 70-year-old Kikukawa chose this illiterate british salesman as his puppet successor to prolong his reign. (but woodford was not cleaver enough to understand his real role as a puppet). i also suspect that both of them are directly responsible for Olympus's disastrous M&A with regard to UK-based Gyrus and others. Both of them should leave. Otherwise, the company would probably go the same horrible downward spiral as that of Sony under Howard Stringer.

Most likely there was substantial differences in cultural and business approach. Olympus management is very old fashion traditional company and didn't want the change.

There's nothing more frustrating and hopeless than to be involved in a situation where change is necessary but resistance to change keeps trumping it.

yabitsOct. 15, 2011 - 05:24AM JST. There are few decisions as important to a company as selecting a leader. Overlooking a cooked resume might be excused for an entry-level position, but CEO? Gimme a break here.

Woodward was qualified to be a CEO, maybe not in stubborn company like Olympus. Japanese companies have increasingly been turning to foreigners for help in revamping their operations. The trend has so far been limited to companies needing help restructuring. But the change is a highly visible symbol of the way Japan has grown amenable to foreign investment, management and influence. Woodford fits the gaijin profile well. He made his career as a cost-cutter, having turned round Olympus’s U.S. and European medical devices businesses and, later, its overall European operation, which today generates about half of the Olympus global profits. Most likely there was substantial differences in cultural and business approach. Olympus management is very old fashion traditional company and didn't want the change.

Perhaps they made a bad decision and regretted it. Perhaps he was an idiot.

There are few decisions as important to a company as selecting a leader. Overlooking a cooked resume might be excused for an entry-level position, but CEO? Gimme a break here.

Let's suppose it was Chairman Kikukawa who wanted Woodford. If the other senior managers thought it was time for the Chairman to go, then allowing him to make such a highly visible bad decision would be one way to do it. If we see Kikukawa stepping down in the next 3-5 months, it would tell us a lot. But there's going to be at least one senior manager departing as a result of this fiasco, you can bet on that.

Olympus was not in the best of shape when they reached out for Woodford, and all this drama has not helped them in the slightest. Ordinary employees must be quite perplexed and worried about this.

It's not surprising that Woodford had to leave. Olympus board would've tolerated Woodford's action if they made money. The bottom line is Olympus profit has been down almost 40 percent from year earlier and somebody had to go. Olympus needs change and they should release some cameras that don’t all look like each other. There’s little or no way to intelligently differentiate between all the E-PEN models out there. That, and they definitely need a marketing campaign for U.S. market. A lot of the younger folks getting into photography don’t know about Olympus products. Canon and Nikon have name recognition in photography, Panasonic has name recognition from their range of other consumer electronics, Olympus doesn’t have any of that.

The decision was also surprising because two weeks ago, Olympus said “the board have been extremely pleased with the progress made under Mr Woodford’s leadership,” in comments just six months after his appointment as president........................................

ummmmmmmmmmm, sounds just like TEPCO saying everything was fine 6 months ago.

The very same board that selected him had to get rid of him so quickly. What does that tell you?

The Board of Directors, especially Kikukawa made the wrong choice.

From reading various sources (Nikkei, mostly), it appears he attempted to drastically cut R&D expenses which didn't sit well with others. In addition, Kikukawa stated that the agreement was for him to be in Japan 80% of the time but turns out he was only there 40%. And as others have alluded to, instead of giving directives to the managers, he gave them straight to the subordinates.

Thanks for your insight MrLondon! You have proved some people here wrong so I am happy about that!

Neojamal? Why do you want to lump all Japanese as having the same traits? Are you a generalist? I suggest you read MrLondons comments. Thank you very much.

Sorry, I am only giving my opinion on this rather than concrete evidence on his recent appointment, however I will add to this by saying he was extremely successful running the European side before being appointed to global head because he gave them what they wanted, massive profits with no questions asked. Perhaps when they actually had face to face day-to-day dealings with him they didn't like what they saw. Evidently they didn't.

There are stories about the behind the scenes company ethos and money spent (which incidentally i'm sure are the same at every large corporation) at the top which would rather spoil the shining gloss of Olympus UK at least.

As I said, for me his ousting is simply karma. I am sure there are many worse people in business out there, this is just one that I have much first hand experience of.

Yabits, I can tell you are laying on a bit of sarcasm, but besides, I see zero connection between "the vaunted, harmonious, consensus-building system" and "such an embarrassing appointment."

As I said, he could have cooked his resume.

He could well have cooked up parts of his resume to wangle the post. Why automatically lay into the Japaese side?

Without all the facts being laid bare, we're all largely guessing.

On a personal note he had absolutely no respect whatsoever for the 'little people' who worked hard for him, he took huge sums of money out of the company to reward himself

Well, so much for the vaunted, harmonious, consensus-building system that led to such an embarrassing appointment.

Yabits - "The very same board that selected him had to get rid of him so quickly. What does that tell you?"

Perhaps they made a bad decision and regretted it. Perhaps he was an idiot.

It could tell you a range of things.

I worked closely with Mr Woodford for several years, company politics got him to his lofty position, and company politics were eventually to be his downfall.

On a personal note he had absolutely no respect whatsoever for the 'little people' who worked hard for him, he took huge sums of money out of the company to reward himself (and for his off the record endeavors to get awarded a knighthood) whilst paying extremely poor salaries to many of his staff.

This is, in my opinion, extremely over due schadenfreude.

The very same board that selected him had to get rid of him so quickly.

What does that tell you?

I'm not getting this. Olympus was a widely-known multinational business long before Woodford jumped on board.

It's not like he saved it or anything.

And let's not forget - Japan has a long list of market leaders and major global players - despite their apparently 'sub-par' Japanese management.

Gosh, Toyota - the world's richest car company - is one of them.

I'm not defending Japanese business practices - I'm just saying give them credit where it's due.

As someone noted above, it will be interesting to hear Mr. Woodford's version of things if/when he becomes able to speak about it openly.

I hope that happens, but it's not likely if some nice payments are arranged to ensure he keeps silent about it. Money has a way of doing that.

It's a fascinating story.

As someone noted above, it will be interesting to hear Mr. Woodford's version of things if/when he becomes able to speak about it openly.

There must have been lots of boardroom politics involved...

Second, he has been highly successful, in great part by doing what this guy was doing -- short-cutting much of the un-necessary Japanese bureaucracy and worthless process.

Really great points.

Only someone who really loves Japan would care enough to rail against the crap that holds her back and is taking her down. And, yes, sometimes it takes someone who is outside of it all to see things clearly.

I had the opportunity to work in the Tokyo office of my former (US-based) company on an average of just under two months a year for four years.

One thing I will never forget is when the CEO from the home office in California would be scheduled to visit. For nearly two weeks prior to his visit, nearly all other work would be dropped while the entire office would devote itself to making PowerPoint slide-shows with nice pie charts and graphs to explain why we weren't doing all that well. It was a monumental, colossal waste of time and effort -- utterly sickening to behold.

If I had one piece of advice for foreign CEOs who have a branch in Japan it is this: Tell them that you will show up, but you will give them only one day's notice before you do. Tell them if they're going to be prepared for anything, to be prepared for that.

People always talk that Japanese are racist,etc,etc,I disagree with this opinion,if that were true Carlos Ghosn, the most famous gaijin would not president of Nissan by so long.

issa1 -- really? I think not. The reason Carlos Chosn is CEO of Nissan, and has been for so long, is due to two factors. First, Renault bailed Nissan's failed Japan-led management out, and insisted on appointing him as part of the deal. Second, he has been highly successful, in great part by doing what this guy was doing -- short-cutting much of the un-necessary Japanese bureaucracy and worthless process. And, having worked with Nissan in Japan, I can tell you that the domestic Japan managers would still dump him if they could and go back to running Nissan the old way, despite the fact that he saved their jobs. Not sure if that makes them racist. But is sure makes them ignorent.

“He ignored our organizational structure and made decisions entirely on his own judgement,” Kikukawa told a hurriedly arranged news conference in Tokyo as he announced Woodford’s demotion.

It's called leadership, people. Why would he make decisions based on somebody else's judgment?

If you keep running things that way, your whole economy is going to be in a terrible mess.

Sony's Howard Stringer ... doing a great job as CEO's

I wouldn't say Sony is doing all that well.

Nissan's Carlos Ghossan and Sony's Howard Stringer are doing a great job as CEO's of a Japanese company, this guy just didnt know how to do what the Romans do..

in defiance of efforts to create a Japanese style of global management

LOL. This is an oxymoron -- a HUGE one. There is no such thing as a "Japanese style of global management " , or at least very, very few examples. The global economy moves much too fast, and individual market conditions vary too much for the centralized, bureaucratic, concensus-building, tedious, Japan-focused style to work. Especially since many, if not most of the top managers/directors have never worked overseas, and have no foreign langauge skills. Toyota is having its problems due to this, and Sony got blown out of the market by companies like Apple for these same reasons. The slide will continue.

"he tried to cut drastically things like basic R&D expenses so that the company's profits and executive compensation rise in the short run (a few years). stereotypical gaijin management."

rarara: If what you wrote above is true, how come just two weeks ago, according to the report, "Olympus said 'the board have been extremely pleased with the progress made under Mr Woodford's leadership'"? Could it be that "stereotypical gaijin management" also appeals to the Japanese?

Getting a little tired of comments that make binary, black-and-white distinctions between Japanese and white Western businessmen.

In the interview of the British Chamber of Commerce in Japan magazine, Mr. Woodford said:

In Japan, I would have upset too many people and have been put in a chair by the window. Japan needs to get to the point quickly where it can release the talent of younger people. I don't have a romantic idea about gaijin bosses. If it was the other way around, I would be the one at the coffee machine saying, "Look at the Japanese individual running this prestigious British company. He doesn't even speak English, so what can he teach us?"

It seems like a self fulfilling prophecy to me....

Is this a case of the new employee orientation program not done properly by Human Resources? You know those programs where in the first week you are taught company culture and how to operate the coffee machine? Its the HR's fault, sack the HR director!

Let's think about why so many great British companies fail here but succeed everywhere else. Boots, Tesco, Pret a Manger, Vodafone and soon to be HSBC and many more. It is because of the Japanese way.

Honestly , I think this British man was stupid. The company was international enough to hire a foreigner as the CEO so I do not think it was a racial issue. I think the issue was that this chap thought he could power his way with the company cause he was the CEO. I am sure that OLYMPUS is not perfect but when you see a problem and want to fix it, you gather everyone and explain what youre gonna do. This chap ignored that and just did what he thought was right. He might have been right but he did not follow the RIGHT procedure...

People always talk that Japanese are racist,etc,etc,I disagree with this opinion,if that were true Carlos Ghosn, the most famous gaijin would not president of Nissan by so long.The Japanese has its way to solve their problems wrong or not.

And let me just add that in situations like this one, involving high-ranking Japanese and white Western business executives, the problem is often mutual arrogance. There's no shortage of immodesty on either side in those types of confrontations, I'm sure.

thepro: Trying to run a big Japanese company must be truly horrible

who on earth expects some gaijin salesman to truly run a big japanese company? he simply cannot communicate with most of olympus employees because he is illiterate.

the reality would be this british chap was employed by Kikukawa (also ex-salesman) as his gaijin puppet., but he was not clever enough to understand his real role (Chaiman Kikukawa's illiterate gaijin puppet ). really absurd.

"Hmmm... Seems like this guy arrogantly thought he could simply transplant European business practices into Japanese business culture."

SushiSake3: And it sounds to me as if you accept at face value what is being reported here. Why so readily accept the tired narrative of "modest" Japanese and "arrogant" Westerners? One could just as easily theorize here that it was the Japanese board directors who were arrogant in their belief that no change in the way the Olympus CEO does things was necessary.

Trying to run a big Japanese company must be truly horrible

What a shame. I can't help but think it's things like this that are rendering Japan an afterthought in today's global business environment.

moomoochoo: Sounds like he was actually doing his job.

right.

he tried to cut drastically things like basic R&D expenses so that the company's profits and executive compensation rise in the short run (a few years) .

stereotypical gaijin management.

Sounds like he was actually doing his job.

They made the mistake of thinking CEO = president (Japanese style)... in where a Japanese president (according to an article on JapanToday) is sort of like "the companies cheerleader"... and actually doesn't do anything but be a spokes person for the company.

Sasoriza：Japanese style of global management.　This is an oxymoron.

Are Mitsubishi Corp., Mitsui &co., etc. global companies? Of course they are. Most sophiscated global companies emplying thousands of foreigners all over the world.

Do they employ some gaijin as their top executives? Of course, no.

SushiSake3

Hmmm... Seems like this guy arrogantly thought he could simply transplant European business practices into Japanese business culture. Also seems like a lot of foreigners here - who clearly don't know or understand the full picture - are more than willing to stand up for 'their guy' despite that ignorance.

So can you please tell me what exactly Japanese business culture is. Because from what l have seen in some places it is lacking what is done in other countries. For example to many people doing not enough work, outdated systems and procedures, to much red tape to be effective, no independent thinking, no initiative, do minimal work during the day to be able to claim overtime. And thats just the starters. So yeah poor guy how dare he actually try and change this culture

Hmmm... Seems like this guy arrogantly thought he could simply transplant European business practices into Japanese business culture.

Also seems like a lot of foreigners here - who clearly don't know or understand the full picture - are more than willing to stand up for 'their guy' despite that ignorance.

Good luck to him. I know what he had to go through, face the same type of "circular logic" in my office. It can get frustrating sometimes, but what really gets me is when I ahve started something that works after all of the foot dragging by the Japanese employees they act like they never had any conflict and all is well.

I at least hope this guy was well compensated.

http://bccjacumen.com/features/cover-story/2011/09/the-straight-talking-scouser/

I just read that interview, thank you wyoming. Honestly I don't know what to say... 「・・・・・・・・・・・・」 Care to share your thoughts with me?

Japanese style of global management.

This is an oxymoron.

Japanese are racist in the workplace I tell you.

I'd rather call it racial discrimination as being discriminative is as big as being racial in Japan. This kind of discrimination strikes even Japanese who return to their company after a, say good five years, of mission abroad and the bullying and ostracizing begins as soon as he back. They are never taken back and are treated as foreigners.

Woodford was interviewed at length on the cover of the recent BCCJ Acumen magazine of the British Chamber of Commerce in Japan and he says some very blunt things about Japanese management style, so no surprise here he got sacked. Great interview here: http://bccjacumen.com/features/cover-story/2011/09/the-straight-talking-scouser/

If Tim Cook told his Apple engineers to put an extra button on the iPhone, but didn't tell the head of that division anything - you wouldn't say that was 'good communication' for a CEO would you?

Ok, so this guy was made CEO, and decided to run the company by communicating directly to employees, and not including division heads in anything? That doesn't sound like a good CEO to me - Japanese company or not.

when he was hired it was expected he would bring change: http://www.olympus-global.com/en/info/2011b/if111001corpe.html

only problem was he tried to bring it...

when he was hired it was expected he would bring change: http://www.olympus-global.com/en/info/2011b/if111001corpe.html

Sounds like we are only hearing 1 side of the story.

hes a go getter, he can change things, lets promote him.

the new CEO is a non-conformist, lets oust him!!! Welcome to Japan

Ah yes, slacking off at the job. Quite a few Japanese do it. I can look around my office right now and see 2 guys reading books, another guy on his Android and the director playing Solitaire on his laptop. A few guys just talking away the minutes. Oh I can't forget the guy in the corner who's looking at a new car brochure.

We work very differently indeed. I think it's a game though. They hired this guy, made him CEO but they knew all along. Hey this guy is NOT Japanese. We can't expect him to be like us. So why put him up there in the first place?

Reader, let me ask you a rhetorical question. Have you ever felt that you were set up to fail. Have you ever felt that the organization you work at has shows very little enthusiasm towards your ideas and would do the very minimal to help you succeed, even if the company would benefit from it? I believe it happens. You could be on the right path, doing the right things but someone in the organization doesn't want to see you succeed, even if it means that they fail right along with you.

Personally, I think this guy probably performed very well. Maybe too well. His achievements allowed him to bust through the glass ceiling and become a CEO. A Gaijin at the top? His colleagues may not have been as ambitious as he was but they most certainly put their energy together to bring him down. Even if the company loses the talent this individual brought to the table.....it doesn't matter. The company stays Japanese.

Japanese are racist in the workplace I tell you. They stick to their Japanese business model even if it works or not. Steve Jobs came to work in a turtleneck and jeans. It isn't about your suit or your Rolex watch or the fact that you shave your face everyday. It's about what you do with the talent and intelligence you have. Japanese think they are working as a collective but in fact they are servants at best. They don't want to be the leaders or take responsibility. They just want the free ride.

You're right. It isn't. As long as you know your place, can put up with the endless office bullying, the meetings, the BS, the sempai/hohai crap, not expect to get promoted to management positions... If you're a slacker with no real ambition, keep your mouth shut... you'll be fine.

I agree with some of your points, but not all successful gaijin Executives in J companies are slackers with no real ambition. I do have a real ambition. I made enough money in my bank. Now I've even started my own biz and making even more money than I used to..:)

Working in Japan Inc is not that difficult after all.

You're right. It isn't. As long as you know your place, can put up with the endless office bullying, the meetings, the BS, the sempai/hohai crap, not expect to get promoted to management positions... If you're a slacker with no real ambition, keep your mouth shut... you'll be fine.

Quote from Financial Times article "Japan's changing 'gaijin' CEOs" (2011 JUL 4):

"[Woodford] says cultural differences in business are ‘massively overstated’ and describes his mandate as: ‘Do what you did in Europe, and do that around the world.’"

Based on the benefit of hindsight, looks Wood ford was wrong. The cultural differences in business are NOT 'massively overstated' and his mandate 'do what you did in Europe..." flopped. I hope in the near future ex-CEO Woodford shares take on the matter.

I told him repeatedly he couldn’t do that, but he didn’t listen,” Kikukawa said.

Sounds like the shortie is really upset..hah. If Mr Woodford had come to my coaching session, I bet he would still have his job. Working in Japan Inc is not that difficult after all.

I suspect his lack of experience working within the Japanese parent company, and his unfamiliarity with the "quirks" (to put it mildly) of Japanese management doomed his efforts

One person's quirks are another person's business culture.

Bizarre.

Don't know about you, but this phrase caught my eye, "a Japanese style of global management". A bit of an oxymoron, no?

As for those who believe that Olympus will be adversely affected by this, not sure about that. When it comes to certain fields, I am pretty sure they are doing quite well with or without Mr. Woodford.

Personally speaking, Mr. Woodford, welcome to "The Way". :-(

tmarieOct. 14:Be prepared to see Olympus go down, down, down

actually, Olympus has been already going down, down, down since they bought Gyrus (UK-based medical equipment maker). (I guess this british guy was deeply involved in the Gyrus purchase).

Seems straight-forward. Guy with good business sense but inflated ego and poor personal skills. Hits fiscal targets but needs frequent warnings about his power-harassment. Just two weeks after getting new appointment, managed to do or say something egregious enough for a public shoving off.

I do not have any privy info on this. It could be different, but I've seen this sort of scenario often enough.

ah, the backstabbing, the whispering. It's all coming back. I'm sure he's looking for a real company who actually want leadership. Too much deadwood in Japan Inc.

Hahahahahaha! Seems he stepped on a few too many old guy's toes and didn't pay attention the sempai/kohai, "I'm old so always right, you can't change anything until the Japanese all have a meeting and agree to it, you're a gaijin so know your place..." crap. Idiots. Be prepared to see Olympus go down, down, down if they can't handle new blood taking charge and having some new ideas.

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.

This guy wasn't just hired out of nowhere--he'd performed successfully within the company's European operations, streamlining and strengthening their business there, and it was on the basis of that performance that he was called in to lead the global organization. Olympus has its global strengths in medical imaging and other specialized fields, but has seen its consumer imaging (digital cameras, etc.) business falter, losing significant market share to more nimble competitors--reorganizing the company around its inherent strengths was one the tasks Woodford was expected to take on.

I suspect his lack of experience working within the Japanese parent company, and his unfamiliarity with the "quirks" (to put it mildly) of Japanese management doomed his efforts, despite his track record elsewhere in the organization.

Still, overall a significant failure for Olympus, one that may severely hamper their efforts to adjust to changing market forces.

and, as T_rexmaxytime points out, Olympus already dominates the world market share in such fields as most sophiscated endoscopic. as i wrote in my previous post, their current problem probably stems from the purchase of that UK medical equipment maker.

A case of," you HAVE to do it the japanese way". must have upset a few that won't accept change. The share price seems to have reflected the decision by Olympus.

Now, wait a minute I don't get it. First of all, why did they emploed him, something went wrong and they needed someone to do the job that they couldn't?

Then, if they called him to do thing differently and he did want to do so then why is this a problem. Wasn't he called to do things differently? Olypmus didn't say he did things wrong or caused damage, jut did differently. If he should have done the same way as the board of directors want then what would have changed?

As I see Olympus only called a foreign president to have somebody, a damned gaijin to execute their mad plans and be a scapegoat for failure. Poor man took his job seriously and wanted to do his job well at time when the board of directors have already had a well laid alternative plan for the bankruptcy liquidation of the company and for their safe evacuation their personal fortune and they themselves as well.

And they made a mistake the guy went through all their filtering and they failed to notice he had a bit higher IQ than they assumed. Too bad .

T_rexmaxytime:　And this English man seems like an idiot not trying to understand that already existence way unlike the CEO of Sony.

and, under that British/American top executive, Sony's performance has been really horrible over the past several years. even worse at places like Shinsei Bank (under american management/ownership).

and, in the case of Olympus, i suspect their purchase of Gyrus (UK-based medical equipment maker) has been dragging down their performance.

LOL! Welcome to Japan Inc.!

It's not really Olympuses loss. Olympus already dominates the world market share in many fields. They are already set. And this English man seems like an idiot not trying to understand that already existence way unlike the CEO of Sony.

I agree with the posters above. Olympuses loss. Good luck to you Mr Woodford. Better off out of that crap anyway.

Its pretty hard to fight/change the "WAY", its becoming a real curse on Japan

Hey JT dig a little deeper & gets the real nitty gritty!

@ Sherman : My thougth exactly, thumbs up to you and thumbs down to Olympus..

Another vision navigator crashes and burns. You just cannot change the mindset of huge Japanese companies. Poor guy.