Can We Learn Management Techniques From the Japanese Ringi Process?
A basic philosophical concept of Japanese management is ringiseido: decision-making by consensus. Are any of its practices applicable in the West? These authors make a case for useful implementation of some aspects of ringiseido and its application through a technique called ringi. Their research includes interviews with 14 Japanese businessmen who worked at six large Japanese companies This is a list of companies from Japan. Note that 株式会社 can be (and frequently is) read both kabushiki kaisha and kabushiki gaisha (with or without a hyphen). See that article for more details. . 
The ringiseido decision-making concept is an important aspect of Japanese culture that arises from Japan's group orientation. Ringiseido allows group members to participate in decision-making while respecting and maintaining their hierarchical relationships. The application of ringiseido is called the ringi decision-making process.
Most Japanese businesses and government organizations make decisions based on consensus which has been described as an agreement by all parties involved in a group's decision, with each group member satisfied with the ultimate decision. Of equal importance is that no one is individually responsible for success or failure. 
The Japanese business system has roots in the family-clan-village structure, which reflects a strong relationship between ringiseido decision-making and Japan's unique social and cultural tradition. 
Consensus decision-making Consensus decision-making is a decision-making process that not only seeks the agreement of most participants, but also to resolve or mitigate the objections of the minority to achieve the most agreeable decision. is an essential element of Japanese business tradition. Japanese view workers in a holistic framework, with an individual's contribution of secondary importance to the group's harmony and conformity. Japanese practice narugakae: the "total man" concept, leading to total emotional participation in the group.  Because togetherness and consensus are valued contributors to group morale and harmony, consensus decision-making is stressed.
The decision-making philosophy is derived from the traditions of the Japanese family In Japan, as in every country, the family is the earliest focus of social life for an individual, and it provides a model of social organization for most later encounters with the wider world. system, based on authority highly concentrated in the head of the household. In the past, the head of the household made all significant decisions for the entire family. Today, he is often more interested in maintaining harmony and consensus than in upholding his authority. Therefore, he consults with other household members before making important decisions. A similar change from autocratic to consensus decision-making is reflected in Japanese companies. 
As Japanese companies grew in size and complexity, it became difficult for the head of the company to make all important decisions. A process, termed ringi, evolved to overcome the traditional autocratic "one decision-maker" practice. The ringi process is based on the ringiseido philosophical concept.
Robert Christopher probably summed up the consensus style best when he wrote, "Probably the single most important thing to know about the Japanese is that they instinctively in·stinc·tive
1. Of, relating to, or prompted by instinct.
2. Arising from impulse; spontaneous and unthinking: an instinctive mistrust of bureaucrats. operate on the principle of group consensus. For an individual to achieve self-gratification at the expense of the collective welfare is regarded as unspeakably reprehensible rep·re·hen·si·ble
Deserving rebuke or censure; blameworthy. See Synonyms at blameworthy.
[Middle English, from Old French, from Late Latin repreh ." 
The consensus style does not necessarily equate e·quate
v. e·quat·ed, e·quat·ing, e·quates
1. To make equal or equivalent.
2. To reduce to a standard or an average; equalize.
3. to agreement with, or even real input into, the final decision. The consensus style provides a feeling of participation and a mechanism for enforcing group compliance with the superior's decision. This style has been aptly described as "moral suasion Moral Suasion
A persuasion tactic used by an authority (i.e. Federal Reserve Board) to influence and pressure, but not force, banks into adhering to policy. Tactics used are closed-door meetings with bank directors, increased severity of inspections, appeals to community spirit, or , creating a consensus of concerned people who can exert their positive influences"  on the other group members to support the final decision. The process allows real participation and relevant input. However, other culture-based aspects of Japanese organizations also influence the process. Specifically, there is a strong sense of hierarchy and loyalty to the group in most Japanese organizations.  These characteristics push all group members to accept the final decisions made through the ringi process.
Ringi Process Characteristics
Several noted authors describe the Japanese decision-making process and the ringi process as decision-making by consensus,  consensual CONSENSUAL, civil law. This word is applied to designate one species of contract known in the civil laws; these contracts derive their name from the consent of the parties which is required in their formation, as they cannot exist without such consent.
2. understanding,  "root binding" leading to the commitment needed for decision implementation,  a team exercise,  and "diffuse diffuse /dif·fuse/
1. (di-fus´) not definitely limited or localized.
2. (di-fuz´) to pass through or to spread widely through a tissue or substance.
adj. decision-making."  However defined, the ringi process is characterized by intensive discussion before final decisions are made.
A first step in understanding the ringi process is to analyze the word in Japanese. According to according to
1. As stated or indicated by; on the authority of: according to historians.
2. In keeping with: according to instructions.
3. a Japanese manager from Tokio Marine and Fire Insurance Company, ringi consists of two parts: rin, "submitting a proposal to one's superiors and receiving their approval," and gi, "deliberations and decisions." Put another way, ringi means "obtaining approval on a proposed matter through the vertical, and sometimes horizontal, circulation of documents to the concerned members in the organization." 
How does the ringi process work? A Japanese businessman (working for the largest Japanese food manufacturer) explained that, in the ringi process, authority and responsibilities for each level of management are not clearly defined. Policy guidelines guidelines,
n.pl a set of standards, criteria, or specifications to be used or followed in the performance of certain tasks. are not specified by top management. As lower-level managers are confronted with numerous decisions, they must refer all but a few routine decisions to top management. The lower-level managers must follow a specific procedure and draft a document called a ringisho. An English translation of a ringisho is in Appendix A. The ringisho describes the matter to be decided and makes a specific recommendation. The ringisho is not a mere inquiry to top management. It does not suggest alternatives for top management's approval; rather, it offers a specific recommendation.
After completion, the ringisho is circulated among managers potentially affected by the pending decision; and to managers whose cooperation may be necessary for its implementation. As each manager evaluates the ringisho, he indicates his approval by affixing his personal seal (hanko) right side up. (Seals are often used instead of a personal signature.) A hanko affixed af·fix
tr.v. af·fixed, af·fix·ing, af·fix·es
1. To secure to something; attach: affix a label to a package.
2. upside Upside
The potential dollar amount by which the market or a stock could rise.
This is basically an educated guess on how high a stock could go in the near future.
See also: Bull, Downside down signifies rejection, and a hanko affixed sideways indicates indifference to the recommended decision. Depending on the importance of the matter and the organizational structure This article has no lead section.
To comply with Wikipedia's lead section guidelines, one should be written. of the company, the ringisho eventually reaches top management. Once the top individual in the hierarchy affixes his hanko, the decision is final. The ringisho document is then returned to the original author for implementation or reconsideration. 
The decision-making process can be time-consuming because it requires group participation and consensus. Several weeks can pass before a final decision is made.  An example was provided by the manager of a large insurance company who said once when he was a subsection subsection
any of the smaller parts into which a section may be divided
Noun 1. subsection - a section of a section; a part of a part; i.e. head (kakaricho), he circulated a ringisho on a simple client-related matter. After ten days, it was finally returned to him with his manager's approval and the recommendations were eventually implemented in another two weeks.
The responsibilities for decision-making are highly diffused and usually cannot be associated with one individual. However, there are exceptions to the group decision-making process. Larger Japanese companies often have a small group of executives (a faction called the jitsury-oku-sha)--led by the CEO--who make or shape important decisions.  Other firms might have one person in control or with dominant influence over the direction of the company.
Managers in the decision-making process incur only limited responsibility by affixing their hanko. Each is one of many managers reviewing and expressing agreement or disagreement. A Japanese manager that we interviewed said it was very rare to see a ringisho rejected. The document is usually informally approved before its formal submission. The ringisho's purpose is to create an atmosphere conducive to group consensus--to reach agreement on the most proper course of action.
William Ouchi William G. Ouchi (born 1943) is an American professor and author in the field of business management.
Bill Ouchi was born and raised in Honolulu, Hawaii. He earned a B.A. from Williams College (1965), an MBA from Stanford University and a Ph.D. in his book Theory Z distinguishes Japanese from Western group decision-making. The Western style implies obtaining agreement from all concerned parties. Often, total agreement cannot be reached and those who disagree only grudgingly grudg·ing
Adv. 1. go along with the decision. Western decision-making within a large American group can be difficult. In the ringi process, Ouchi observes that "the apparently cumbersome decision process takes place within a framework of an underlying agreement on philosophy, values and beliefs... Because Japanese only debate the suitability of a particular alternative to reach the agreed upon Adj. 1. agreed upon - constituted or contracted by stipulation or agreement; "stipulatory obligations"
noncontroversial, uncontroversial - not likely to arouse controversy values, the process can be broadly participatory." 
Considering the limited participation of top management in the process, combined with group pressure to accept the proposals once they have gained momentum, it is evident that the decisions are actually made by the ringisho's authors. As one Japanese businessman described the process, the proposal's author often alerts senior and peer managers by noting "if you remember, you and I agreed" or other similar phases to prompt agreement of the ringisho. This process, called "Nemawashi," is defined as a "political process by which an unofficial understanding is reached before a final decision is made on a particular matter." 
"Ne" means root and "mawashi In sumo, a mawashi (Japanese: 廻し) is the belt that the rikishi (or sumo wrestler) wears during training or in competition. Upper ranked professional wrestlers wear a kesho-mawashi (see below) as part of the ring entry ceremony or " means turning around. The word originates from the act of transplanting a tree. Before transplanting a large tree, the gardener performs groundwork by digging around the roots and turning the roots into a bundle. The ringisho's author uses the process of nemawashi to prepare the groundwork for the ringisho's approval.  If the original ringisho is not approved before it reaches top management, it is revised by the author. If the revised document again fails to obtain approval, it is withdrawn before reaching top management. Because the author seeks informal approval before formal circulation of the proposal, withdrawal is usually avoided. 
Practical Application of the Process
Because of confidentially concerns, no company would permit the review of an actual ringisho. However, the following were described as examples of the ringi process in a typical company environment.
Situation: Company worker identifies a potential new client.
Process: A ringisho is composed with important account information and an outline of the potential benefits from acquiring the client. The objective of the ringisho is to obtain company-wide concurrence CONCURRENCE, French law. The equality of rights, or privilege which several persons-have over the same thing; as, for example, the right which two judgment creditors, Whose judgments were rendered at the same time, have to be paid out of the proceeds of real estate bound by them. Dict. de Jur. h.t. for adding the client. The ringisho is circulated to various departments to determine if the potential client matches each department's requirements. For example, to finance/accounting (for credit worthiness), to distribution (for logistical lo·gis·tic also lo·gis·ti·cal
1. Of or relating to symbolic logic.
2. Of or relating to logistics.
[Medieval Latin logisticus, of calculation support) and to public relations public relations, activities and policies used to create public interest in a person, idea, product, institution, or business establishment. By its nature, public relations is devoted to serving particular interests by presenting them to the public in the most (for appropriateness of associating with the new client). An example of this ringisho is in Appendix A.
Situation: A decision concerning financial commitment is needed.
Process: A ringisho is composed with various financial alternatives. Based upon the financial requirements, the ringisho is circulated to the appropriate management levels. For example, it might be circulated to a board committee that comprises the chairman, the president (Shacho) and vice presidents (Fuku Shacho) in situations where there is a commitment over 50 million Yen; to a senior management group of vice presidents for a commitment of over 25 million Yen; and, to a divisional manager (Bucho) for a commitment below 25 million Yen.
Situation: A decision to establish a foreign subsidiary is needed
Process: A ringisho is composed with the relevant facts, opportunities and pitfalls. It is circulated widely within the company because a foreign subsidiary could have broad operational implications. For example, finance/accounting is concerned with foreign exchange issues and manufacturing is concerned with quality control.
After analyzing the decision-making process and discussing it with Japanese businessmen, we believe that the ringi process has several advantages. The process permits initiative from lower-level managers by giving them responsibility for carrying out action. It gives top management control while providing a method for group participation. The ringi process compensates for potentially incompetent incompetent adj. 1) referring to a person who is not able to manage his/her affairs due to mental deficiency (lack of I.Q., deterioration, illness or psychosis) or sometimes physical disability. top management by giving lower-level managers an opportunity to shape decisions. 
We also believe that the ringi process has several disadvantages. Lower-level managers may have inadequate overall knowledge of the company to make effective decisions. The ringisho maybe contrary to the company's best interest, causing disunity dis·u·ni·ty
n. pl. dis·u·ni·ties
Lack of unity.
Noun 1. disunity - lack of unity (usually resulting from dissension) and disharmony dis·har·mo·ny
1. Lack of harmony; discord.
2. Something not in accord; a conflict: "the disharmonies that assail the most fortunate of mortals" Peter Gay. . (This problem could be reduced through informal approval, nemawashi, before the proposal is completed.) The ringi process retards rigorous analysis of pending decisions, since alternatives are not considered. Information accompanying the proposal can be inadequate. The diffusion of decision-making authority makes it difficult for an executive to acknowledge that a prior investment was wrong and a project should be terminated.
The inability to make spontaneous decisions can inhibit long-range planning.  The ringi process helps obscure individual responsibility and, therefore, helps "deindividualize" the exercise of power.  The ringi process contributes to compromise which, in some cases, may dilute di·lute
To reduce a solution or mixture in concentration, quality, strength, or purity, as by adding water.
Thinned or weakened by diluting. the decision's purpose or negatively change the proposal.
The organizational culture This article or section is written like an .
Please help [ rewrite this article] from a neutral point of view.
Mark blatant advertising for , using . may compel Compel - COMpute ParallEL individual group members to accept the final decision, even if they disagree. We have noted the that ringi process allows for a feeling of participation, but may not always offer opportunities for true participation.
Implications for American
Although this discussion maybe an interesting review of a Japanese business practice, one might ask, "So what?" And, "Is it relevant to American management?"
The effectiveness of the ringi system is based on Japn's cultural foundation. The uniqueness of the Japanese culture and its effect on their business success has been recognized by many authors.  Japanese business practices are grounded in their social and cultural behavior Cultural behavior is behavior exhibited by humans (and, some would argue, by other species as well, though to a much lesser degree) that is extrasomatic or extragenetic, in other words, learned. Learned Behaviour
There is a species of ant that builds nests made of leaves. patterns.  The ringiseido philosophy is facilitated by the demographic homogeneity Homogeneity
The degree to which items are similar. of the Japanese society. The ringi participants demonstrate a highly similar set of values, attitudes and perceptions concerning most issues. These similarities have been described as culturally based business characteristics. 
As with any successful technique, the relevance of ringiseido to American business is determined by its applicability and appropriateness within the American business culture. We believe that the following elements of ringiseido could be directly applied by American managers:
* The recognition that most decisions have system-wide effects
* The political/organizational importance of informing other departments of the potential effects on their groups from a pending decision
* The inculcation in·cul·cate
tr.v. in·cul·cat·ed, in·cul·cat·ing, in·cul·cates
1. To impress (something) upon the mind of another by frequent instruction or repetition; instill: inculcating sound principles. of feelings of participation by all parties in the decision-making process; and in each new decision
We earlier noted "the lack of true participation in the final decision" as a possible disadvantage. This disadvantage would be a significant problem in most American organizations. In general, because they lack the Japanese culture-based intense group orientation, Ameican workers are much more cynical about group processes. American managers would have difficulty implementing a ringi-style process if their workers perceived it as a charade charade (shərād`), verbal, written, or acted representation of a word, its syllables, or a number of words. The object is to guess the idea being conveyed. Winthrop M. . To be effective, the ringi-style process must offer American workers true participation and empowerment. Joanne Ciulla has written that "management issues today often center on issues related to trust and loyalty." She has cautioned against "bogus bo·gus
Counterfeit or fake; not genuine: bogus money; bogus tasks.
[From obsolete bogus, a device for making counterfeit money. empowerment" that does not seek true worker participation. 
American managers often take a more direct approach to decision-making, demanding "agreement" rather than concurrence from other groups. However, American managers can learn from the Japanese desire to keep all relevant parties informed of their decisions. The ringi process of circulating cir·cu·late
v. cir·cu·lat·ed, cir·cu·lat·ing, cir·cu·lates
1. To move in or flow through a circle or circuit: blood circulating through the body.
2. a document for "sign off" may not be appropriate in the U.S., but American managers should explore other ways of promoting the internal flow of information.
In the ringi process, many people, including lower-level management, automatically participate in decision-making. Because decisions are made after thorough discussion, few objections occur during implementation.
The Japanese businessmen we interviewed agreed that the ringi process reflects Nemawashi: informal agreement reached before a final decision. Once informal agreement is reached, the decision has everyone's support and commitment.
Our analysis of the ringi process supports a finding of strong group orientation within Japanese companies. A group orientation, a wide diffusion of responsibility Diffusion of responsibility is a social phenomenon which tends to occur in groups of people above a certain critical size when responsibility is not explicitly assigned.
Diffusion of responsibility can manifest itself:
The ringiseido philosophy and its ringi process are, in some ways, similar to other "consensus building" techniques (e.g., nominal groupings, Delphi) often used by American managers for decision-making and problem resolution. The uniqueness of ringi is its reliance on the cultural homogeneity of its Japanese participants. As with many successful techniques, ringi is not unique-its success comes from the effectiveness of its use.
MOHAMMAD ALA Mohammad Ala is an Iranian scholar, writer, community activist and an expert in production and operations management.
Dr. Ala is a Board member of Persian Gulf Organization and Professor of Operations Management. He teaches in Iran, China, and the U.S.A. , Ph.D. is a professor of management in the College of Business and Economics at California State University, Los Angeles California State University, Los Angeles (also known as Cal State L.A., CSULA, or "'CSLA"') is a public university, part of the California State University system. . He is also the founder and director of the College's Productivity Center. A recipient of the University's Outstanding Professor Award, Dr. Ala has written many articles that have been published in prestigious journals and books about management issues in a variety of fields that include health care, computer applications, and expert systems.
WILLIAM P. CORDEIRO, Ph.D. is a professor of management in the College of Business and Economics at California State University, Los Angeles. His research interests include ethical decision-making for managers working in diverse environments, and Japanese management practices. He teaches business ethics business ethics, the study and evaluation of decision making by businesses according to moral concepts and judgments. Ethical questions range from practical, narrowly defined issues, such as a company's obligation to be honest with its customers, to broader social and strategic planning Strategic planning is an organization's process of defining its strategy, or direction, and making decisions on allocating its resources to pursue this strategy, including its capital and people. at the undergraduate and graduate level and is program coordinator for the Capstone Course in Global Strategic Management.
(1.) These companies included a major car manufacturer, an insurance company, a bank, one hotel/restaurant chain, and an electronic component manufacturer. These companies were chosen because they were leaders in their respective fields in terms of domestic and international market share. They were also selected because they had a larger number of employees (than their competitors). These large organizations, that requested anonymity, allowed us to observe the various stages of obtaining ringiseido approvals.
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New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of : Fawcett Columbine columbine, in botany
columbine (kŏl`əmbīn), any plant of the genus Aquilegia, temperate-zone perennials of the family Ranunculaceae (buttercup family), popular both as wildflowers and as garden flowers. .
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Buoyancy or lightness in movement that allows a dancer to rise and fall smoothly.
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Date: November, 2000
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At the home of; at or by.
[French, from Old French, from Latin casa, cottage, hut.]
at the home of [French] CORPORATION
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