JPMorgan Chase Management and Leadership - Case Study Example

 JPMorgan Chase Management and Leadership Paper Introduction JPMorgan Chase is the result of a recent acquisition that has further diversified the variety of different products and services offered to its clients of assorted demographics. From home loans to investment offerings, the company must operate an organization with multi-national employees and work to satisfy the needs of international buyers. This is not an easy task, as the demands placed on the business due to globalization and centralization of lending/investment practices requires a dedicated organizational culture and competent leadership. At the same time, JPMorgan must determine the best method to satisfy foreign customers with vastly different needs and lifestyle values in an ever-changing and adaptable work environment. This requires dedication to setting up a healthier organizational culture built on teamwork and trust as primary principles for the business. This paper describes the role of manager versus leader at JPMorgan Chase, the process of maintaining a healthy organizational culture, and offers strategies on how to support a vigorous and dedicated team of professionals. Differentiating management from leadership The roles of traditional manager and that of an internal leader are significantly different in today’s fast-paced, international business environments. The role of manager is that of planning new operational activities and delegation of employee responsibilities, including assessment of financial data through management accounting. In the role of manager at JPMorgan Chase, this would include reviewing strategic plans, developing risk management policies, and considering the scope of major capital investments (Epstein & Roy, 2010). This role is primarily operational and strategic in nature, assessing long-term strategies and then aligning internal staff to meet these mandated goals. The role of manager in this financial institution is also setting a series of control practices, such as new employee policies, to ensure that all members of the organizational staff are performing their job roles effectively and considering proper allocation of organizational resources both budgetary and human resources-related. Management is a process-minded and procedural role with considerable employee oversight. In an organization like JPMorgan Chase, it involves a transactional focus, which is offering contingent reward to high performers based on their individual or group performance for meeting corporate goals (Judge & Piccolo, 2004). In this role, at a company like JPMorgan, these activities include monitoring changes in financial regulations, managing liquidity, and retaining quality employees. These are only some of the responsibilities. A leader in this organization has a different role, one that includes mentoring, coaching and helping others to become self-actualized through self-esteem development. A leader also is transformational, rather than transactional like the manager, involving establishing methods on how to assist in bringing out the best characteristics in employees such as promoting charity, organizational harmony and engaging in shared goal-attainment (Bass & Steidlmeier, 1999). In the role of leader, whether management-based or in relation to their own peer network, employees should be able to use the individual as a model by which they guide their own behavior and develop positive interpersonal relationships built on trust and mutual esteem. Where the role of manager involves considering issues of product pricing, the product and customer mixes, and development of sales promotions (Helgesen & Voldsund, 2009), leaders are more instrumental in helping others to become motivated and committed using a blend of psychological strategies based on human behavior. Managers are not required to model these behaviors at the same level as leaders, since the responsibilities of managers are more connected to areas of marketing, product pricing, production, inventory control and other operational aspects as their primary goal. However, just like the leader position, managers are just as responsible for improving relationships with lower-level workers and providing them with quality resources and communications to avoid motivational problems. The Healthy Organizational Culture Managers and leaders at JPMorgan Chase have overlapping roles when it comes to creating a more rewarding organizational culture, even though leaders typically have more visibility when it comes to this function. Wilson, Lenssen & Hind (2006) describe the activities of leaders in providing a more stable organizational climate, including acting in integrity, the demonstration of ethical values and behaviors, being open-minded in situations, and having positive communications skills. Leaders need to listen to the needs of employees when they have concerns and establish a form of protocol regarding the development of interpersonal relationship-building. A health organizational culture starts with understanding the goals of the business and then using positive reinforcement techniques to get others on-board with individual and group project goals to meet long-term strategy. Failure to recognize value in employees will lead to unmotivated workers and high costs of turnover, especially in an organization that is fast-paced and demanding like JPMorgan Chase. Managers have a similar role, however their presence in creating a healthy organizational culture differs slightly. Clarity is the key in communications to ensure that everyone on staff understands their obligations when planning and implementing new strategies. There is a tendency of workers to resist change practices when managers implement them, therefore a preliminary understanding of what is expected promotes more dedication. Managers “plan a strategic formulator to the workers” while trying to achieve productivity goals (Smith, 2010, p.2). There must be consistency in communications when attempting to motivate a unified culture dedicated to achieving specific mandates and job role functions as they evolve, especially in an environment like JPMorgan Chase that is pressured by global customer needs and a demand for a responsive business. Impact of Globalization on JPMorgan Chase Globalization has increased competition significantly, as borders are opened for direct foreign investment in the financial industry and with the rise of new financial institutions across the world. Because of this, companies like JPMorgan Chase need to establish a method by which to gain competitive advantage. Such advantage might involve a better developed human capital base through building more emphasis on training so that employees are prepared to outperform competitive labor. Globalization has also built the need to have a more skilled workforce, therefore more emphasis needs to be placed on human resources and employee relations. This can be a significant budget issue in areas of recruitment, retention and staff training based on learning benchmarks or for staff understanding of how to operate new software programs as they are implemented. The demands placed on the business are substantial due to globalization as external changes in market forces drive companies like JPMorgan Chase to constantly manage change practices and launch them successfully without employee resistance. Stroh (2005) identifies that managing across borders requires high emphasis on training since there is a definite need to understand the local cultures and foreign market customers that a global organization will be servicing and working with. For example, if JPMorgan Chase has an operation in India will full support services, management leadership will need to understand their cultural dimensions related to power distance, uncertainty avoidance, or other factors at the social and cultural levels. Indian clients or internal workers may value collectivist values while at the home country individual values are more appreciated. Expatriate leaders sent overseas to manage a new global division would need to understand these preferences in order to develop any kind of quality reward system or organizational structure to guide these workers. A business cannot service its foreign customers effectively without understanding what drives their motivations, needs and lifestyle values. Globalization has brought together many different cultural backgrounds that must work together, even if they are in disagreement, to sustain competitive advantage and maintain a healthy organizational culture. This starts with knowledge and training. Creating a Healthy Organizational Culture Giving employees at JPMorgan Chase the ability to regulate their own job function is a key strategy to build a better organizational culture. “Freedom to organize their own working day and to carry out tasks under their own initiative, is an important health factor to the employees (Knifton, Watson, den Besten, Grundemann & Djikman, 2009, p.7). Employees want to feel like they are important and valued resources to the organization and do not necessarily appreciate tight controls over their activities with a great deal of management presence. Offering employees opportunities for autonomous working environments fulfills their need for self-esteem and improves motivation to meet goals. Another method of building a better culture is allowing employees to become more active in decision-making by decentralizing decision-making and allowing it to become more horizontal throughout the business. This can be accomplished by setting up an employee survey program that offers opportunities for suggestions or improvements or allowing lower-level employees to take part in mid-management meetings to discuss their concerns or problems. This concept fulfills their psychological need for active involvement and appreciation and shows that their leadership and management teams care about their job roles and value their contributions. A third method for improving organizational culture is through improving feedback and communications related to their job function. In businesses as large as JPMorgan Chase, there are going to be some employees considered high performers and others that are not meeting performance goals. Those who excel should be recognized and offered different incentive packages for high performance and segregated from others with known performance problems. This can occur through an annual appraisal process, a 360 degree feedback system involving many people that the employee remains in contact with in their job role, or offering promotions. Allowing low-performers to be grouped and rewarded in the same level as less-performing workers could lead to resentment, burnout in their job roles or create poor interpersonal relationships between workers and management. Feedback and reward systems are vital to keeping turnover costs low at JPMorgan Chase due to angry employees that leave in favor of better job opportunities with more rewards for meeting performance goals. Companies like JPMorgan Chase have many financial and budget obligations to meet when operating in a global environment, therefore excess training costs for new employees related to higher turnover is something it cannot afford. In a real-life scenario, JPMorgan Chase has developed a wide variety of different initiatives to boost motivation and improve organizational culture, allowing employees to meet and share ideas and well as network. These include PRIDE for gay and lesbian workers, Women of Color Connections for African-American women, Adelante for Hispanic workers, and N.A.T.I.O.N.S involving Native American workers (jpmorganchase.com, 2010). The company believes that networking between people with similar beliefs and values will improve connectivity throughout the organization and provide a more stable and rewarding organizational culture. By diversifying the support network for people with diverse cultures and needs, the business improves its interpersonal relationships and bridges gaps between multi-national divisions. These initiatives further reinforce the value that all workers have at the organization and are supported by executive and mid-level management at JPMorgan Chase. Conclusion There is definitely a substantial difference between management and leadership, with managers being more controlling and coordinating while leaders take a more humanistic approach to working with others to promote social and organizational harmony. This is important when the pressures of globalization make it necessary for more competitive tools and better trained human capital in order to satisfy diverse, international customers. These pressures make it difficult to establish a rewarding organizational culture unless both managers and leaders create new strategies to build a better climate in which to work and thrive. JPMorgan is a prime example of a global organization that remains committed to supporting healthy organizational principles and assisting people with diverse needs to succeed and be recognized for their accomplishments. Even though managers take on different roles from leaders at the business, they both have a role in sustaining a better communications and feedback system, among many other transformational and transactional duties, to give the business its edge in a highly competitive international marketplace. It should be said that JPMorgan Chase has a well-developed system to improving organizational health and uses both its managers and leaders to accomplish this using a variety of feedback tools and networking opportunities. This is vital in a globalized business environment that relies on dedicated support staff to reach business goals and satisfy customers. References Bass, B. & Steidlmeier, P. (1999). “Ethics, Character, and Authentic Transformational Leadership Behavior”, Leadership Quarterly. 10(2), p.188. Epstein, Marc & Roy, M. (2010). “Corporate Governance Is Changing: Are You a Leader or a Laggard?”, Strategic Finance, Montvale. 92(4), pp.31-38. Helgesen, Oyvind & Voldsund, Terje. (2009). “Financial Decision Support for Marketers in the Norwegian Fishing and Furniture Industries”, British Food Journal. 111(7), p.622. Retrieved November 4, 2010 from www.sciencedirect.com. Jpmorganchase.com. (2010). “Initiatives”. Retrieved November 4, 2010 from http://www.jpmorganchase.com/corporate/Corporate-Responsibility/corporate-initiatives.htm Judge, Timothy & Piccolo, Ronald. (2004). “Transformational and Transactional Leadership: A Meta-Analytical Test of their Relative Validity”, Journal of Applied Psychology, 89(5), pp.755-768. Knifton, L., Watson, V., den Besten, H., Grundemann, R. & Dijkman, A. (2009). “A Guide to Promoting Mental Health in the Workplace”. Retrieved November 3, 2010 from http://www.enwhp.org/fileadmin/downloads/8th_Initiative/MentalHealth_Broschuere_Arbeitgeber.pdf Smith, Robert. (2010). “Roles that Managers and Leaders Play in Creating and Maintaining a Healthy Organizational Culture”. Retrieved November 3, 2010 from http://www.articleclick.com/Article/Roles-That-Managers-and-Leaders-Play-in-Creating-and-Maintaining-a-Healthy-Organizational-Culture/997151 Stroh, Linda K. (2005). International Assignments: An Integration of Strategy, Research and Practice. Mahwah: NJ Lawrence Erlbaum Associates, Inc. Wilson, A., Lenssen, G. & Hind, P. (2006). “Leadership Qualities and Management Competencies for Corporate Responsibility”. Ashridge. Retrieved November 4, 2010 from http://www.ashridge.org.uk/Website/IC.nsf/wFARATT/Leadership%20Qualities%20and%20Management%20Competencies%20for%20Corporate%20Responsibility/$file/LeadershipQualitiesAndManagementCompetenciesForCorporateResponsibility.pdf Read More