Since Japan’s huge unprecedented successes in industry and technology, scholars have been studying Japanese companies to determine the secrets behind this success. Some have claimed that U.S. companies could be more effective and profitable if they adopted Japanese practices. Quality circles and cross-functional teams are on the list of Japanese-style business practices that have been tried with varying degrees of success in the U.S.

Another Japanese concept tried in U.S. companies applies to the decision-making process.  Traditional American style decision-making and traditional Japanese style decision-making differ in one crucial aspect:  that of where the decision originates. American organizations have had a top-down decision-making process where the highest-level appropriate executive originates the decision (perhaps asking for input from others—perhaps not) and hands the decision down as a mandate for everyone to follow. On the other hand, traditional Japanese style decisions originate at operating levels and are supported, coordinated and approved by management over a period of time—a sort of bottom-up process. 

As one would expect with two competing economic giants, each attempts to figure out why the other is successful, and decision-making practices on both sides of the Pacific have evolved. Where are Japanese companies in the United States on decision-making?  If you are an American working for a Japanese company, do you ever get to make a decision?

In his book, The Sun Also Rises Over Toledo, WIN President Sada Honda discusses three paths Japanese companies in the U.S. take to get to a decision-making point.  These paths represent three different stages in the evolution of merging Japanese and U.S. business practices.

You don't want to end up working for this type of company unless you are satisfied with the role of implementer, content to carry out plans, rules and solutions without questioning their validity or merit.

On the second path, many Japanese companies have incorporated American elements into their decision-making processes while retaining positive aspects of the Japanese practices. Managers in these companies respect process culture and believe in the benefits of consensus decision-making. They encourage individual thinking and group decisions. Americans who want to participate are encouraged and provided with agenda topics prior to formal meetings and Japanese managers may seek out their opinions prior to meetings. 

Americans who speak up and debate issues during management meetings in these companies have probably gone through the nemawashi process. Nemawashi is a consensus-building practice where a proposal initiator will discuss a proposal with management, peers and support staff informally to build support and discover any opposition. The initiator attempts, through persuasion and discussion of merit, to turn opposition into support. 

The closest American concept to nemawashi is lobbying.  However, lobbying in American companies is less a ritual than nemawashi in Japanese companies because American meetings don’t require consensus of everyone involved as Japanese meetings do. Therefore, a meeting participant who has gone through nemawashi can put a proposal on the table, relatively sure of a positive outcome because extensive groundwork for the decision has already been laid.

Nemawashi might seem a long, round-about method of accomplishing a goal; however, the process has favorable aspects. The first of these is that many people have had input into the proposal. Second is that by the time a proposal makes it to the formal meeting, potential problems and means of solving them have been identified. Third, and very important to the Japanese desire to maintain harmony and save face, is that the proposal can be approved without debate or challenge and the possible resulting embarrassment.

On the second path, the pro forma quality of the meeting hasn’t changed, but American manager participation is encouraged. 

The CEO has final decision-making authority in this sort of company. Decisions are based on recommendations and debate during meetings, feedback from management and perhaps input from headquarters in Japan.

Occasionally, especially when following this path of top-down decision-making, the Japanese executive becomes demanding and ego-centric and really doesn’t listen to anyone else.  In this case, the executive gets carried away with the excitement of power and control and expects others to implement his ideas without question. They may allow some token participation on the part of associates, but decisions have been made already and listening is a strictly political gesture.

There are other variations. There are Japanese investments that allow management to implement a top-down decision-making system. These investments may be left completely in the hands of American decision makers, an approach that eliminates the perceived slow decision-making process normally associated with Japanese companies. Joint ventures where the American partner is dominant are frequently managed solely by Americans.

The important issue if you’re pursuing employment with a Japanese company is to determine what type of decision-making process the company follows. Talk to your WIN search consultant and, if you can, talk to people who already work for the company. Determine whether you will be able to operate successfully within the decision-making process.

2.  How satisfied are current American decision-makers who work for the company?

3.  Am I clear in what is expected from me in the way of decision-making? Japanese can be vague in expressing expectations.  For example, a statement like, “this is how we approach [decision-making] but the opposite style is also acceptable” would not be uncommon.

4.  What is the positional strength of the Japanese president of this company?  Does he fit one of the following profiles: 

• A borrowed cat (a Japanese idiom meaning one who is overly cautious because of being in a new environment) with no decision-making and influential power;
• a milquetoast who follows the parent company’s instructions all the time; or
• a nail that sticks out?  In this case, the nail that sticks out will believe in his decisions and defend his American executives and managers in front of and to parent company executives.

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