《Kinyu Journal》 2006年11月27日
作者：Paul Meehan, Shinji Yamamoto
The financial industry in Japan has reached a new strategic phase. There has been a shift from the pursuit of a "bottom line" strategy to increase profit, which has been pursued since the 1990s, to a "top line growth" strategy aiming for growth that provides a sustainable profit increase. U.S. and European banks have entered the Chinese market, and a stream of Japanese banks have expanded into overseas markets, raising the curtain on a global battle for securing new areas of growth.
Japanese financial institutions are entering a period of growth
The key to a successful growth strategy is not only strategic skills on how to expand an organization's core business into peripheral areas--such as new customers targeted, regions, businesses, and upstream and downstream areas of the value chain--but also decision-making capabilities that can swiftly and accurately carry out decisions regarding investments and strategy implementation. Decision-making processes for a growth strategy may seem to be measures that involve having a dream, enjoying oneslef, and being proactive. However, it becomes apparent that if you consider the actual decision-making organization, processes, and personnel, you will face large issues.
Should decision making for a particular acquisition be handled by business units and divisions or by the corporate center? Should the sales strategy for corporate finance-related investment banking products and investment products be drawn up by the product division or the sales division? Should the strategy for foreign financial institutions after the acquisition be decided at overseas branches or the international division at headquarters? Should the pricing strategy and operational strategy of companies with equity participation be created by the company investing or being invested in? There is a risk that issues already evident, such as those exemplified by the examples above, may increase. Unlike the mechanics of the organization and decision making in the era of single-business models, organizations that focus on a multi-business model will develop into a matrix-like structure, further complicating the decision-making process. In addition, it is possible that if the path to growth is pursued, the organization will develop into a cubic structure.
Decision-driven organization and RAPID®
Bain & Company conducted a global survey concerning organizations "capable of achieving a high level of performance." The survey indicated that only about 15% of the 350 global companies responded that they have established a sufficient organization that can obtain such results. It also showed that respondents recognize that organizations with high performance demonstrate superiority in effective decision-making.
Based on the survey results, we reached the following three conclusions. First, the organization must be emphasized in order to actualize a growth strategy. Second, and even more important, is how effectively that organization can make decisions. Third, it is crucial to consider not just the theory behind an organization but how to design an organization that enables effective decision-making.
A decision-driven organization is an organic system that drives growth, and it plays a role in aligning leadership, accountability, human resources, frontline personnel's abilities, culture, and other elements indispensable to growth with actualizing a growth strategy, thus ensuring effective measure implementation.
In order to build a decision-driven organization, we use an approach called RAPID--which stands for Recommend, Agree, Perform, Input and Decide--to help companies, including financial institutions, develop clear decision-making guidelines (see figure). Although things do not strictly follow the RAPID process, it is an important tool to fundamentally improve the decision-making capabilities of companies.
RAPID is the key to improving decision-making capabilities and processes
A case study of a credit card company
To see how it works, consider what happened at one global credit card company. The company recognized that skills for card-replacement operations for customers who have lost their credit cards is crucial to increasing customer loyalty, and the company knew what the problem was. Indeed, surveys showed that nearly 50% of the customers ranked the procedures concerning lost cards as "unsatisfactory." One survey respondent voiced the common frustration: "I have had to deal with your company on a number of occasions merely to replace my credit card. Even for simple requests and procedures, I had to talk to at least two people, often more. During this time, forms went missing; and one employee would not be able to recall at all what another had done. It took a month to replace the card. That's absurd."
Inside the company, there was confusion even in terms of recognition regarding who had responsibility to make things right for customers in need of replacement credit cards. A myriad of decisions--ranging from where to ship the card, what type of plastic to use, whether to change the security number, whether the customer merited special treatment, even who would inform the customer--were split up among different job levels. As such, the speed of the decision making process was vastly slower than that of competitors.
The company's situation was: "A lack of a clear decision-making process meant inconsistent, ad hoc decisions in local operations around the globe." It was a classic case of global versus local, in terms of decision-making.
To improve its decision-making, company executives implemented the concept of RAPID. The credit card company recognized that customer service managers were closest to the issue of card replacement in the local market, so they were tasked with coming up with the Recommendation. Others then were asked to agree to a recommendation before it moved forward. At the same time, the company established a cross-functional customer-service team to weigh in on decisions about performance indicators to track the card replacement process as well as individual cases that merited broader application areas. On a global scale, the firm also took the step of creating a new position of "process owner," an executive with authority over the companywide platform design for all processes, as well as over decisions on standardized card replacement processes.
With RAPID, the process reaches a person who issues the final "D" (decision). This person is a single point, leading the organization to implementation, and this person has accountability in the process. This person must possess the vision to make business decisions, a grasp of trade offs, and a thorough understanding of people's ability to carry out decisions. In the case study above, the final "D" rested with the local market customer service managers, who are closest to the front-line process.
As RAPID took hold, the organization became accustomed to making process-oriented decisions. Those with "I" (input) responsibility began to provide more relevant information. They also learned that although consensus is a worthy goal, it can become an obstacle to action or a recipe for compromise according to the lowest common denominator. Over time, these managers became able to perform the new role of making decisions with such consistency that customer surveys showed a dramatic 75% decline in "unsatisfactory" ratings concerning card replacements. For the credit card company, crisp decision-making translated not only into more satisfied customers, but higher earnings. In fact, the company said that it experienced a $30 million upsurge in revenue over three years.
Who has the "D"?
No single lever turns a company immediately into a decision-driven organization, of course, but the principle behind RAPID is its efficacy, which can be seen not only in relatively small processes such as the case study described earlier but also in important decision-making processes across larger organizations. You will know your company's operations are on track when managers realize they are spending less time in meetings wondering why they are there. And when one reliable person has the "D," bottlenecks will disappear.
By taking some practical steps, any company will be able to become more effective, beginning with its next decision.
Born in Kanagawa Prefecture on September 16, 1958. After graduating from Keio University in March 1982, he was engaged in capital-market and derivatives operations at the Bank of Tokyo. He obtained a master's degree in business administration from the University of Chicago with honors and is a member of the National Honor Society. After serving as financial group leader at the Tokyo office of the Boston Consulting Group and representative of the strategic organization group at A.T. Kearney, he became the representative partner at Bain & Company Japan in January 2006. He became the only Japanese person to be included in the 2005 edition of the Euromoney Guide to the World's Leading Financial Services Consultants and Advisors. His major publications include Mokaru Ginko wo Tsukuru (Making a Profitable Bank), published by Toyo Keizai, and 30 Sai karano Seicho Senryaku (Growth Strategy for Those Aged 30 or Older), issued by PHP Institute.
Born in Ireland on August 9, 1965. He graduated from the University of Dublin's Trinity College with a honours degree in economics. He also studied corporate finance at London Business School. After working for the London and San Francisco offices of Bain & Company, he became the representative of Australia office in 1988, before taking up his present role at Tokyo office. In Europe, North America, Australia, and various Asian countries, he has assisted companies in a wide range of industries (including banking, insurance, asset management, distribution, consumer goods, and public institutions) in solving such issues as global strategies, growth strategies, organizational strategies, corporate restructuring, and business process and cost improvements. He is also the leader of Bain's operating committee and organizational strategy practice group in Asia.
RAPID® is a registered trademark of Bain & Company, Inc.