For good and effective major decisions, the requirements are:
(a) clear understanding of the problem, (b) its possible solutions and
(c) the required action by the relevant group of people in an institutions.
Quite often, top management may just misunderstand the problem and its decision,
however quick and apparently sound, may be an answer to an irrelevant problem.
A decision taken may not be the right decision as the possible alternative
courses of action may not have been explored. Again, even if a problem is
identified and a decision taken, it may not become immediately effective if
the people who have to take action do not understand the problem, its solution
and the proposed action.
For major policy decisions -- involving innovative departures from
the conventional approaches -- it may be worthwhile to pose the problem to all
relevant departments of the bank. The advantages would be: (a) a clear
understanding of the problem or the non-problem by the top management as well
as the other managerial cadres; (b) exploration of alternative solutions and
action programmes; (c) commitment by the relevant departments to action with
all its implications -- commitment of key personnel, assignment of responsibilities, performance expectation and its systematic feed-back to top management.
With all this preparation for a decision,
whatever top management decides is
likely to be appropriate and, more important, it is likely to be an effective
decision in terms of actual action.
Selection of appraisal criteria, new promotional activities, new
ways of raising resources, shortening of administrative and other procedural
- 17
lags, new and more effective ways of project supervision - these are some
of the problems which can be tackled in this way. This method ensures good
communication and the performance of the system as a whole, as it motivates
the entire institution to consider its problems, possible solutions and the
action programs required.
This is the Japanese method of decision making by consensus. This
is not consensus as understood in terms of the lowest common denominator.
It is really an art of making effective decisions. What is important in a
Japanese business enterprise is not an answer to a question but the question
itself. What they spend much time on is on defining the question -- a process
in which all managerial and other cadres are involved. The result is that the
problem is understood in all its implications and the alternative solutions
and action programmes are explored and examined. Once this is done, the
decision becomes almost obvious and so does the action programme to the
relevant personnel. So that taking a decision and acting on it become two
simultaneous processes rather than two distinct stages. Normally, elsewhere
a decision is taken and then it has to be "sold" to the people who have to
act on it. Hence, the time taken in effective decision making is longer
elsewhere than in Japan. Further, in Japan, conflicts are ironed out at the
stage of decision making and the entire institution identifies itself with
the problem and its solution. This promotes harmony, a sense of participation
and hence a sense of identification with the interests and performance of the
entire institution.
