I'm not playing the fool here, I just am one (i.e. ignorant)... wouldn't the plagiarism stuff have come up when she was appointed President? Like would she have had a hearing or something first?
Seems like she stayed clear from raising suspicions (by simply not publishing more and going into administration instead) but now she made herself some serious enemies willing to do the work.
The consequences are a matter of trust: A simple office clerk with no scientific training going through the ranks at Harvard growing into "President of Harvard", on the understanding that they "merely" ensure that the business chugs along (and with a proven track record in doing that) while keeping a large part of such administration work off the backs of the scientists and teachers is a better fit than somebody who's demonstrated disregard for the tenets of scientific work.
It doesn't matter why President Gay's works were scrutinized right now, the loss of trust is still real.
Harvard should already have been doing that, but it's clear the board who hired her had no real interest in verifying her credentials.
Also bear in mind that Harvard tried to stick by her and even excused her congressional testimony and after investigating the initial plagerism instances. At a certain point the plagiarism instances just became way to numerous (50?) to reasonably explain them away by carelessness.
A hearing doesn't imply that they thoroughly checked.
Imagine chaos that Google could cause if it looked for common phrases across its corpus of sites/books/papers.