Olympus: When the Gods Came Tumbling Down
In April 2011, Michael Woodford, a British national, is appointed president and chief operating officer of Olympus. Within months of becoming president, Woodford discovers that Olympus has made some questionable acquisitions and paid large amounts of money for companies with few assets, and exorbitant advisory fees to non-substantive companies based in the Cayman Islands. It became clear to him that colleagues and respected board members within the company were propagating and concealing fraud, costing Olympus shareholders more than a billion dollars. When he confronts the Olympus chairman, Tsuyoshi Kikukawa, and other executives, he is met by silence or given ambiguous answers. When Woodford made moves to expose the scandal and push for Olympus to re-gain its accountability he was terminated from his position, relieved of his board seat, told to turn in his mobile phone, laptop and all related business items and to “take a bus” to the airport. Did Woodford act correctly? Should he have done anything differently, and what could he do next?
This case covers several topics relating to crisis management: whistleblowing, corporate governance, accounting scandals, leadership, cultural values, ethics and shareholder value and obligation. Students will gain a basic understanding of crisis management, learn how to incorporate decision making models and tools, learn about the roles of global regulatory bodies and appreciate how ones perspective of a crisis is influenced by culture, morals, personal gain or loss, individual responsibility and reputation, and legal implications; and the importance of ethics in decision-making.
Inspection copies and teaching notes are available for university faculty. To receive an inspection copy and teaching note, please email email@example.com with your registered faculty email ID and a link to your contact information on the faculty directory at your university as verification. An inspection copy and teaching note will then be sent to your faculty email account.