Matsushita Electric Industrial Co. last month announced a decision to abolish its long-standing system by which individual product divisions handled the integrated development, production and marketing operations for their products. The system, praised as the secret of the consumer electronics giant’s success, was established in 1933 by the late founder Konosuke Matsushita, the guru of Japanese-style business management. The company once had more than 120 independent divisions for products such as television and VCRs. Officials said the only way to survive intensifying competition is for top management to work out integrated strategies and oversee their implementation.

Nissan Motor Co., the Japanese automaker that was sold to the French automaker Renault because of its difficulties, recently posted an amazing profit turnaround under President Carlos Ghosn, a former Renault executive. Ghosn showed the importance of management strategies and cool decision-making to Japanese executives who were used to traditional management style.

Japanese companies are now aware that the key to surviving cutthroat business competition in the global market is a top management that is capable of working out viable strategies and exercising strong leadership.

In contrast, Japanese politics remains chaotic. In November, Koichi Kato, a dissident in the ruling Liberal Democratic Party, challenged unpopular Prime Minister Yoshiro Mori by threatening to support an opposition-sponsored no-confidence motion against the Cabinet. However, LDP leadership groups succeeded in their campaign to dissuade Kato’s supporters from backing the motion, and Kato’s group ended up merely boycotting the Lower House session for the voting. As a result, Mori, who was named to his post as a result of backroom dealings by several LDP leaders, remains in power. Mori, who is gaffe-prone and known for reactionary tendencies, is troubled by public-disapproval ratings of more than 70 percent, according to media polls. While the business world is undergoing a sea change, politics remains unchanged.

As Mori says, he is a “legitimate prime minister” elected by the majority of Diet members. The system by which people elect their leaders, through public elections or indirect elections in Parliament, is the fruit of 20th-century democracy. The system was carried over to the 21st century as a universal principle as a result of democracy’s victory over fascism, communism and other dictatorial political systems. The Philippine revolution in 1986 and the democratization of South Korea in 1987 were major steps in Asia’s democratic reform. Reverting to the old ways is impossible.

But as democracy spreads, problems are surfacing. The monthlong U.S. political confusion over the results of the presidential election showed the limitations of the 18th-century Electoral College system and the lack of accuracy in vote counting. President-elect George W. Bush will always be remembered in connection with the election trouble. In Japan, there are mounting calls for direct elections of the prime minister, amid public frustration over the secretive nomination process for choosing the nation’s top leader. In contrast, South Koreans are demanding that ministerial appointments all be lawmakers, to promote better coordination between politicians and bureaucrats.

The means of selecting a strong national leader through a democratic process is a crucial issue for the world in the 21st century. In the coming years, the world will be reeling from the effects of the U.S. economic slowdown, high oil prices, and the euro’s weakness. After a period of slow recovery, the Japanese economy is again decelerating. The South Korean economy is in a shambles after the dissolution of the chaebol (industrial conglomerates). As globalization spreads, individual nations are fighting to protect their national interests, and diplomacy is becoming more complicated.

Optimism about Asia’s prosperity — touted as a potential driver of the world economy in the 1990s — is diminishing. Asia faces a multitude of problems. In most countries, people are looking for strong leaders. However, there are no surefire ways of electing them.

Company workers, bound by common interests, are free to leave if unhappy. However, nations are universal entities with diverse, complex interests, and it is difficult to exercise national leadership. As a result of their size and sweep, nations are inevitably affected by partisanship. South Korean President Kim Dae Jung, the 2000 Nobel Peace Prize recipient, is widely praised in Japan, but gets much less support at home. This stems from frictions over domestic reform and economic difficulties. Though Kim and Mori are troubled by low public-approval ratings, their problems are not the same.

The confusion over the U.S. presidential election showed that even U.S. democracy is imperfect. In the 21st century, all nations face the daunting task of examining their political systems and reforming them as needed.

Openness will be the key word in world politics. In Japan, traditionally, public interest has been the governing principle of politics. But trust in the nation, the foundation of the national interest, has been undermined, and the question has arisen as to what is the public interest.

In the 21st century, transparency will be the basis for legitimacy. In electing a national leader, his or her ability, vision and enthusiasm must be scrutinized by the public. In 20th-century politics, numerical strength was all-important, but from now on, the ways that strength was obtained will be closely examined.

Democracy, the only surviving political system in the 21st century, will undergo severe tests before it is perfected.

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