Jamie Dimon Case

Executive summary:

In this report we try to evaluate the performance of CEO & chairman of JP Morgan Chase James Dimon. In a nutshell, the paper discusses several periods of Mr. Dimon's career, examining his performance at one of the world's leading financial organizations and provides a comprehensive summary of his leadership.

Having been named as CEO of the year by BusinessWeek in 2007 and included in the list of top 100 most influential people in the world according to Times magazine (what year?), to being accused in a Forbes article of grave blunders and running a company "that places little value on compliance and business integrity" in 2013; His career has certainly been full on controversy. Was this a classic example of the halo effect at work? By scrutinizing his performance, we tried to assess if the judgment of these analysts and reporters was simply clouded by the then recent events that had affected JP Morgan Chase or whether their claims held some validity. We often placed emphasis on the timing of business press articles: we assigned less importance for articles...

Our assessment of the New York born Chief Executive Officer comprises a personal background and a brief look at his career prior to JP Morgan Chase. We also examined some of Dimon's career milestones at JP Morgan Chase: his performance prior to the 2008 financial crisis contrasting it with that following the crisis, the regulatory concerns that JP Morgan Chase had in more recent times as well as bigger scandal that took place in 2012 and involved several billions of trading losses (also known as London Whale).

We then proceeded to examine his leadership at the company in more detail using two main frameworks. Firstly, we looked at the pattern of accountability that he instilled in the company in the context of of the above events that transpired at the company: the decentralization policy he implemented, the performance evaluation and incentive structure used. Moreover we supplemented our analysis by using the four criteria for executive performance evaluation: Evaluating and retaining talent, deciding how to de-centralize, recognizing and exploring opportunities and communicating.

Given no good assessment of any chief executive is complete without a thorough look at the performance of competing firms, we also attempted to briefly evaluate the industry's environment and competitiveness. The performance of two major competitors was also examined: Wells Fargo and M&T Bank. We thought that these two organizations were most relevant to our analysis, given their performance was similar to that of JP Morgan Chase. So we provided some comparative analysis, relating his performance to that of Wells Fargo chairman, John Stumpf, and CEO of M&T Bank, Robert Wilmers. Both managers had similar career patterns as James Dimon did and were in charge of big financial organizations in approximately equivalent periods of time.

Finally, we summarized our findings in a conclusion specifying where we thought Jamie Dimon's performance ranked in one of three categories: Excellent, adequate or highly questionable.

Dimon's personal and professional background before JP Morgan Chase:

Even prior to joining JP Morgan Chase, Jamie Dimon's professional pedigree was certainly impressive. Having graduated with a Harvard MBA in 1982, he favored going to work for Sandy Weill at American Express over a higher paying offer from Goldman Sachs. Weill was the boss of Jamie's father at the time and became somewhat of a mentor to Dimon. In fact in 1986, after leaving American Express, Weill bought and gained control of the Commercial Credit Company, a finance firm mainly serving middle-class customers. Dimon followed suit and a decade - and many acquisitions later - the duo had transformed the company into a financial empire, now known as Citigroup. Throughout that period, Jamie Dimon managed many financial services firms, notably First Chicago Corp, Primerica, Smith Barney and Salomon Brothers. Weill handled the strategy and Dimon managed people and evaluated risks. It seemed like the perfect partnership until the overly ambitious Dimon grew restless of being a no.2. Late in 1998, Weill, not yet ready to retire, fired Dimon from the company he helped build.

Sixteen months of unemployment later, he returned to financial services in 2000 to lead the troubled Bank One, America's fifth largest bank at the time. As CEO, he managed to turn around the loss making company, itself the result of two rival organizations merged together that never seemed to mold together into one unified company. In 2004, he became President and Chief Operating Officer at JP Morgan Chase following its acquisition of Bank One. In December 2005, he was named Chief Executive Officer of JP Morgan Chase and one year later he was also named Chairman of the board and has been at the helm of the financial giant ever since.

The New York City born Dimon is shrewd but far from the "cuddly" type; he is outspoken, profane, finishes people's sentences and distinctly short on praise. He seems extremely passionate about his company and the industry overall and is unwary of projecting himself and his company in the public spotlight. In fact he is also quite visible in the political landscape, often arguing against increased government regulatory interventions in financial markets.

Often labeled as "Mr. Details", he is certainly a hands-on manager. Constantly grilling executives at his firm in private or even dressing them down in a public meeting. He surely understands the inner workings of the banking business, his colorful career is testament to that. But as is often the case with good leaders - Dimon enjoyed cult-like status before the financial crisis - he is prone to narcissism. Furthermore, his team of lieutenants keeps changing, on Dimon's orders of course (more on that from retaining talent section). He is unapologetic about that, mentioning that "it's not personal, it's just business". He attributes it to not wanting blind followers around him, rather people who are actually doing their job, part of which is calling him out on a wrong move here and there. That could be true, or perhaps, he had learned his lesson following his relationship with Sandy Weill and does not want a repeat of that dynamic. We will re-examine some of his personal traits and relate them to the pattern of accountability he implemented at JP Morgan Chase in section xx.

Precrisis evaluation

Our pre-crisis performance evaluation of Jamie Dimon, while in charge of JPMorgan, evidence him as an exceptional