When the news came out last week that JP Morgan Chase had agreed to pay $13 billion in fines to settle a case with the U.S. government over the sale of “troubled mortgage securities” I asked myself, “How does their CEO, Jamie Dimon, keep his job? After all, it was less than a year ago that Chase lost $6 billion in bad trades made by the “London whale” and the company paid almost a billion dollars in fines on that one. And then there are the charges about the company offering plum jobs to the children of influential Chinese government officials.
I get it that Chase is a very large and complex organization and that mistakes happen and that one person cannot be personally responsible for everything that happens in an organization of Chase’s size. I also understand that Chase is still one of the top performing companies in its category even with all of its recent problems.
Still, it’s an interesting question to me how the top leader of an organization that’s going to pay out almost $14 billion in fines keeps from getting fired. A recent blow by blow account article in the New York Times about how Dimon has approached the mortgage securities case with the Justice Department shed some light on it for me.
Based on the reporting, Dimon has done at least three things that have helped keep him from getting fired. While few of us will ever run one of the largest financial institutions on the planet, there are some takeaways here that scale for leaders who find themselves dealing with big messes and nervous or angry stakeholders. Consider these three steps as companions to my recent post on “What to Do When the S**t Hits The Fan.”
Visibly Rally the Troops – Dimon hosted a reception last month at the Museum of the City of New York for Chase’s top executives and their spouses. His message was “I’m proud of the company and we will get through all of this.” In one event, Dimon did a number of things that leaders in a crisis situation need to do. First, he showed up. He didn’t hide out. Second, he staged an event that enabled him to literally reach out and touch the leaders who will set the climate for the rest of the organization going forward. Third, by inviting spouses, he supported the executives who are undoubtedly getting all kinds of questions at home about what’s going on at work and what does it mean to our family. That kind of touch goes a long way in keeping people focused and committed when times get tough.
Keep the Ball in Play – After months of staff level negotiations between Chase executives and Justice department attorneys, the mortgage settlement talks weren’t going anywhere. Four hours before the Justice Department was going to hold a press conference to announce civil charges against Chase, Dimon stepped in and called one of Attorney General Eric Holder’s lieutenants to suggest they meet in person. Two days later they did and the talks that led to the settlement agreement began in earnest. When the clock was running out, Dimon came up with a way to keep the ball in play. If you want to solve a big problem, you have to keep creating options that could lead to a solution.
Put Yourself on the Line – The Times article reported that Dimon and Holder talked with each other five time in the two weeks before a deal was struck. Was it risky for Dimon to get that personally involved in negotiations? Maybe, but with the stakes so high how could he not? By putting himself on the line, Dimon became indispensable to the resolution of a problem that could have become bigger if he had not gotten so personally involved. If you’re a leader dealing with a big mess, you can’t really delegate the fix. You have to own it.
So, am I arguing that Jamie Dimon is a leadership role model? No, I’m just suggesting that he’s exhibited some best practices for leaders who find themselves dealing with a big, hairy mess. While your next leadership mess likely won’t be as big as his, there are some things to be learned from how he’s handling a crisis.
What’s your best advice for leaders who find themselves facing a potentially career-limiting mess?