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With over 240,000 staff under his watch and $32 trillion in assets a day to safeguard, it\u2019s no wonder Jamie Dimon runs a tight ship at JPMorgan. <\/p>\n
It\u2019s perhaps why America\u2019s biggest bank, which posted record profits for 2023<\/a>, paid its CEO $36 million for his work last year<\/a>, having navigated the business through the regional banking crisis and acquiring First Republic Bank<\/a>.<\/p>\n On top of that, financial institutions have had to weave a path through uncertainty around the base rate, inflation, unemployment figures<\/a> and rumors of a recession<\/a>. <\/p>\n But New York-based JPMorgan didn\u2019t come out on top by accident. Its leadership has a track record of analyzing a range of possible economic outcomes<\/a> to be prepared for even the most unlikely outcome. <\/p>\n In his 2023 letter to shareholders<\/a>, for example, Dimon said this included planning for a \u201cvery broad range of interest rates, from 2% to 8% or even more, with equally wide-ranging economic outcomes.\u201d <\/p>\n In all of these cases, courtesy of planning, Dimon said his \u201ccompany would continue to perform at least okay.\u201d<\/p>\n \u201cImportantly, being prepared means we can continue to help our clients no matter what the future portends,\u201d he added. <\/p>\n Yet this preparedness isn\u2019t just a habit embedded into the culture at JPMorgan, it\u2019s a leadership tactic Dimon picked up<\/a> from watching people in the military. <\/p>\n In his letter released yesterday, Dimon began the section on management lessons by outlining the benefits of the \u2018OODA loop.\u2019<\/p>\n He explained: \u201cThe military, which often operates in extreme intensity of life and death and in the fog and uncertainty of war, uses the term \u201cOODA loop\u201d (Observe, Orient, Decide, Act\u2014repeat), a strategic process of constant review, analysis, decision making and action. <\/p>\n \u201cOne cannot overemphasize the importance of observation and a full assessment\u2014the failure to do so leads to some of the greatest mistakes, not only in war but also in business and government.\u201d<\/p>\n Completing a full assessment is \u201ccritical,\u201d Dimon noted, for both businesses and governments. <\/p>\n In business, the Harvard alumni wrote, \u201cyou have to understand your competitors, their distribution, their economics, their innovations, and their strengths and weaknesses.\u201d<\/p>\n On a geopolitical scale, this task is a little more complex. <\/p>\n The Wall Street titan noted elsewhere in his letter that the West had \u201cslept\u201d while China quietly established itself<\/a> as a global superpower, with control over certain supplies necessary for America\u2019s economic and national security. <\/p>\n However, Dimon said there was no point \u201ccrying over spilt milk\u201d and that policymakers needed to \u201cfix\u201d the issue\u2014and the OODA loop may help. <\/p>\n He wrote: \u201cFor countries, you need a thorough grasp of their economies, strengths and weaknesses<\/a>, population and education, access to raw materials, laws and regulations, history and culture.<\/p>\n \u201cResearch, data and analytics should be at a very detailed level and constantly reassessed. Only after you complete this diligent study can you start to make plans with a high degree of success.\u201d<\/p>\n The 68-year-old has always had a reputation for being a no-nonsense leader who is frank about his personal beliefs\u2014be it politics<\/a>, careers<\/a> or personal finance.<\/a> <\/p>\n So it\u2019s perhaps no surprise that Dimon doesn\u2019t subscribe to corporate jargon<\/a>, explaining there\u2019s a reason why he rarely rolls out a typical management tactic by talking about his vision. <\/p>\n \u201cThe reason I\u2019ve always hesitated to talk about \u201cvision\u201d is because often it is the basic BS of corporate speak\u2014that somehow if you impart your vision to people, they will take the mountain,\u201d he wrote. <\/p>\n \u201cWhat it really is all about is this: After you\u2019ve done your full assessment and decision-making, you can then continuously educate, explain, train, simplify, propel and fight.\u201d<\/p>\n Instead, Dimon took it back to military tactics by saying he wanted his team to know he was working and strategizing alongside them<\/a>, saying vision \u201conly works if people know you are in the trenches with them, if they understand the mission and if they are there side by side with your effort.\u201d<\/p>\n<\/div>\nThe \u2018OODA loop\u2019<\/h2>\n
\u2018BS corporate speak\u2019<\/h2>\n
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