Change Management Plan: JPMorgan Chase Company Essay

The Organization

JPMorgan Chase is one of the leading firms in the United States’ banking industry. The firm was founded on December 1, 2000, following a merger between JP Morgan & Company and Chase Manhattan Corporation and has its headquarters in New York (Ververken, 2012). Since then, it has experienced major growth through acquisitions and expansions to markets outside the United States of America.According to Kumar (2012), the bank is one of the largest financial institutions in the United States in terms of customer base, profits, and several employees. In the financial year that ended in 2014, the firm had a net income of USD 21.76 billion. With an employee base of 265,395 people and a total asset of USD 2.6 trillion, JP Morgan Chase is undoubtedly the leading financial institution in the world. Jamie Dimon is the current chief executive officer and president of the firm. The firm offers a wide range of financial products. In this paper, the researcher will propose a change in the employment policy popularly used by the firm when hiring the top managers of the firm.

How the HR Policy Proposed Should be Changed

According to Ververken (2012), JP Morgan Chase is one of the best employers in the world. Its employees have registered a higher level of satisfaction compared to the industry average in the United States. However, the firm may need to change its recruitment policy that emphasizes parent country nationals (PCN) when it comes to hiring its top managers in the overseas markets. As DuBrin (2011) says, this policy is not officially stated in the strategic plans of the firm.However, it is a silent practice that has been common at this firm for some time now. The top managers at the firm’s headquarters prefer sending employees from the headquarters to head their branches in the foreign markets. According to the mission and vision of the firm, it is apparent that there is an effort to promote talents in overseas markets. However, this is not what happens in practice.The management has been deliberate when appointing the top managers in the overseas markets (Kumar, 2012). This practice may be normal as a way of promoting the culture of this firm in foreign markets. DuBrin (2011) says that one of the main reasons why firms may consider sending their parent country nationals to head the foreign markets is the desire to retain the organizational culture in the new markets. This might be the reason why this firm has been embracing the practice. However, the researcher feels that this practice should be brought to an end because it may have negative long term effects on the firm’s prosperity in the foreign markets.

Reasons Why This Change Is Important

The current recruitment policy used by the top management of JP Morgan Chase in the overseas markets should be changed. The first reason that makes it necessary to bring the change is that the employing of parent country nationals in the foreign markets is a sign that the bank does not trust the host country nationals. This may give it a negative image in the host country, especially when the top management is crowded with foreigners. The locals in the host country may reciprocate the mistrust by using the services provided by other competitors in the industry. The second reason is that it is more expensive to send the top employees from the parent country to foreign countries to head new branches.The employees will demand huge allowances and regular leave so that they can take care of their families left back at home. As Reiß (2012) says, it is more expensive for an employee to take care of his or her family when working abroad than when he or she is working locally. For one to accept to go abroad he will demand higher pay and this may affect the profitability of the firm.It is more appropriate to hire a host country national that has the needed skills and expertise in the required field even if it may be necessary to take him through further training for him to understand the firm’s organizational culture. Finally, JP Morgan Chase will find it easier to penetrate the foreign markets by hiring the host country nationals than foreign country nationals. These host country nationals understand the local market and how this firm can succeed. They know the market segments that should be targeted and how to attract them.

Recommended Change

As mentioned in the section above, the management should consider changing the policy used in hiring the top managers of overseas branches. It is recommended that these top managers should be the host country nationals. This will not only lower the cost of hiring these managers but also improve the employees’ efficiency and morale in these branches.

Strategy That Illustrates How to Address Each of the Eight Stages of Change

According to Levasseur (2009), bringing change within an organization may sometimes be very challenging. The management of JP Morgan Chase should use the following eight stages to bring the expected change within the firm.

Establishing a sense of urgency

First, the decision-makers should be made to appreciate the urgency with which this problem should be solved. As the firm continues to expand to overseas markets, the management should understand that this policy should be changed as soon as possible to protect the firm’s foreign markets.

Creating a coalition

To implement this change, there should be a collaboration amongst all the stakeholders. The top managers should work alongside the regional heads to ensure that there is a unified approach towards issues affecting the firm.

Developing vision and strategy

The president of this firm and board of directors should reevaluate and come up with a new employment strategy and a vision for the overseas branches. It should understand that each market is unique and should be treated as such. The vision should emphasize hiring the host country nationals at the top management level.

Communicating the vision

After developing this new employment strategy and a vision for the overseas branches, this firm should communicate it to all the relevant stakeholders. This communication aims to ensure that everyone understands what is taking place at the firm.

Empowering a broad-based action

The management should then promote a broad-based action to addressing this problem. It should be flexible and accept alternative solutions in case they are available.

Generating short term wins

It will be necessary for the management to define short-term wins that should be achieved within the next year. For instance, in the next one year, 80% of the top managers should be host country nationals.

Consolidating gains and producing more change

Every gain made in this change initiative should be consolidated as the bank struggles to achieve greater success.

Anchoring new approaches into the culture

Once the new approaches have been embraced, they should be anchored into the culture of this firm.

Potential Resistance to Change and How the Resistance Would Be Managed

According to Certo (2010), resistance to change may not be avoidable in many instances. In this case, the top decision-makers may resist this change for fear of the unknown. They may fear that this approach may erode the organizational culture of the firm. This resistance will be managed by informing the top managers that every foreign market is unique and having a universal culture may not work. This firm should embrace cultures relevant to the markets where it operates.

Communication Strategies to Use

To communicate this change initiative, face-to-face consultative meetings among the top managers will be necessary. The top managers will need to understand the reasons why this change is necessary. An official communiqué through letters may be needed for stakeholders who are unable to attend the meeting. Finally, the management should reflect this new strategy into its vision and mission statements. All the stakeholders will be able to know about this change by simply reading these statements.

Diagnostic Tools to Identify Changes Necessary for the Organization

The management can use various tools to identify necessary changes. The first tool is a financial analysis of the firm’s profitability. Determining the profitability of the firm will help to determine how effective the current strategies are in meeting the objectives. The second tool is the employees’ satisfaction. The top management should determine how well employees in the overseas branches are when they are managed by foreigners.

Recommended strategies for sustaining the change

The following are some of the recommendations on how to sustain the proposed changes;Promote employee development in the overseas branches to ensure that they have the needed skills to hold the top offices. Create a program where the top employees meet regularly and share their experiences to ensure that they all understand the vision and mission of the firm.

References

Certo, S. C. (2010). Supervision: Concepts and skill-building. New York: McGraw-Hill Irwin.

DuBrin, A. (2011). Leadership: Research findings, practice, and skills. South-Western: Cengage Learning.

Kumar, B. R. (2012). Mega mergers and acquisitions: Case studies from key industries. Basingstoke: Palgrave Macmillan.

Levasseur, R. (2009). People Skills: Implementing Strategic Goals—A Change Management Perspective. Management Journal 39(4), 370-372.

Reiß, M. (2012). Change management: A balanced and blended approach. Norderstedt: Books on Demand.

Ververken, S. (2012). Did JPMorgan Chase Bank, N.A. v. Charter Communs. Operating, LLC (In re Charter Communs.), 419 B.R. 221 (Bankr. S.D.N.Y. 2010) violate hte absolute priority rule in bankruptcy. New York: Cengage.