Culture + Business = Misunderstandings?

I read an interesting article in The Economist ("Tribal Japan") that reported the recent firing of Olympus CEO, Michael Woodford. For those of us who have missed it, Michael Woodford is a big deal because he's one of 4 non-Japanese, gaijin (means "outsider", but infers "foreigner") to run a Japanese company.

The controversy stems from the fact that Michael Woodford didn't get fired until he began asking some very awkward questions about approximately $1.3 billion dollars worth of "suspicious transactions" (silly gaijin), at which point the board fired him and literally told him to take a bus to the airport. The company's justification? His inability to adapt to the company culture.

Sure, on the service it looks like a pretty clear case of "Oh no, this guy is asking some bad questions that could potentially unveil the fact that we may have embezzled or covered up over a billion dollars in questionable things. Quick! Fire him!". If this is actually the case, then this should probably be used as a case study of poor corporate governance strategy (Really? You thought the best way to hide the fact that you were doing bad things was to fire one of the FOUR foreigners currently running a Japanese company? This being the guy who regularly gave interviews to small rags like Financial Times? Poor choices). I would like to caveat what I'm about to say by stating that I in no way approve of this behavior.

BUT. (You saw that one coming, right?) BUT. Let's just take a step back and try to see things from another's perspective. Olympus is a very well respected company in Japan (fun fact for the day: it enjoys an almost monopoly on the world's gastro-intestinal endoscopes, with approximately 70% of the world's market share, estimated at ~$2.5billion). It hit its ten year stock high in 2007, with a price of Y5070.00, and since then has had a couple bright spots, but has declined overall since then. More recently, there has been talk of downgrading Olympus to a BBB- status, potentially will be investigated for securities fraud (I'm sure especially in light of the information Woodford raised) and has been involved in a class action lawsuit (which it is now battling, citing that inflammatory and untrue information has been proliferated about the company). Two of its biggest investors, Harris Associates and Southeastern Asset Management Inc., recently lashed out at the company, offering strong suggestions on how to better manage the company and its recent accompanying scandals.

In light of this information, is it possible that the company had been looking for a method to oust their current CEO and replace him with new blood? That potentially they simply have the worst timing ever in making corporate decisions? Or, if it is a cultural thing, maybe it is an acclimation issue-- Woodford was very open in lashing out at his former company in the news, and maybe he potentially was not a fantastic leader. All I'm saying is that there probably are cultural misunderstandings and cultural tie-ins that led to this powder keg, but it could have been exacerbated by outside influences or could potentially be two-sided. Again, I don't approve of their management of the situation, because I'm sure there is a lot of "good old club" going on, but to be honest, that probably happens everywhere. Normally, companies don't make mistakes like this on such a grand scale or in such a fantastically sensationalized way, but it happens. Blowing this story out to be discriminatory move is probably a bit exaggerated.