Back in April 2011 for the first time in Olympus history a non Japanese citizen became Olympus CEO. But after 6 months only the (british) Michael Woodford had been dismissed because of “boardroom and management conflicts“. (Source: Boston.com). The Olympus board appointed Chairman Tsuyoshi Kikukawa as new CEO. It is an unexpected news and Olympus shares plunged more than 14 percent to 2,123 yen ($27.60) on the Tokyo Stock Exchange. The new CEO Kikukawa said that “He (M.Woodford) could not overcome the cultural barrier of Japan and Japanese companies“.
Analysis: What does it mean for Olympus? From what I read on newspapers and from what I know from my sources Michael Woodford is a very competent manager that has been able to improve the Olympus Europa Holding GmBH profits by cost cutting and restructuring. And my guess is that his restructuring plans were to much “advanced” or “revolutionary” for the traditionally very conservative Japanese company mindset. Is that good or bad news? I guess Michael Woodford would have gone rid of the digital camera business if it keeps to loose money like it did in the last years. And that’s something that will probably go against Olympus history and tradition. What will happen now? That news increases the chance that Olympus will keep the digital camera business alive, but the risk is that the board will not take some serious decisions to increase the profitability of that business.
And here is the official Olympus statement about the recent event (Source Olympus Global):
“Michael C. 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.
Hence, judging that realisation of the 2010 Corporate Strategic Plan with its slogan of “Advancing to the Next Stage of Globalisation” would be difficult to achieve by the management team led by Woodford, all the board directors attending today, except for Woodford himself who could not participate in the voting due to special interest, unanimously resolved the dismissal from his office of the representative director, President and Chief Executive Officer (dismissal from the office of the representative director, President and Chief Executive Officer and stays as director without executing right.) Along with this, it was also resolved that the representative director, Chairman Tsuyoshi Kikukawa double as the representative director, President and Chief Executive Officer.
Global management that Olympus aims is to implement management rules, information management and operation that are common throughout the world in order to establish a business infrastructure that is more efficient and quick to respond while making the most of a Japanese style management that sets a high value on people, technology and pride of monozukuri or manufacturing. To this end, all our employees will head for the same direction as we will urgently start establishing a new structure to go towards the same goal with the entire staff as one.“