Did Jamie Dimon, the much vaunted and now disgraced CEO of JP Morgan Chase blow it in managing the $2bn trading bungle? Or, is this another situation of damned if you do, damned if you don’t? I’ve been fascinated to see the different takes on this crisis and varying analysis of Dimon’s performance.
This article in Fortune makes it clear that Dimon is another in a long line, of stupid, inept bungling CEOs that smart journalists like this one for Fortune can’t figure out how they could rise to such high pedestals.
On the other side is this analysis by crisis communication expert Bill Salvin that says while mistakes may have been made, Dimon’s performance is pretty much on target. He provides a good list of the things that Dimon did right.
Personally, I lean more toward Salvin’s view than Ehrenberg’s. Certainly, there is some 20/20 hindsight going on and like most of the rest of the world, I wasn’t paying any attention when Dimon was supposedly vigorously downplaying the trading problem. But what Ehrenberg misunderstands is that the “web afire” does not necessarily mean that Dimon created it, caused it or could have effectively prevented it. Like my previous post on this about the LA Times blog on it, there are a great many Wall Street haters out there (unfortunately for some very good reasons) who love to see the mighty fall and love to see more government regulations. A lot of these would love to see every Wall Street banker, and probably every banker for that matter, in striped suits, and I don’t mean pin stripes.
That’s the nature of our world, and it doesn’t have much of anything to do with Dimon’s performance. So it is misleading to look at situations like this and conclude that the CEO is a dummy and that all this could have been prevented by having a smart CEO. I’d like to think of this as the “Hayward” problem, as in Tony.
The truth is in our world there are some massive shifts in cultural values going on. Big, for a great many younger people particularly, is bad, small is good. Global is bad, local is good. Powerful is bad, me is good. Bankers are bad, Wall Street is hell bound. You get the picture. The media reflect and amplify these values to a considerable degree and they live in their full glory (or ugliness) in the Internet particularly on sites like Reddit. The media see these values at work and the digital lynchmobs forming and decide that this is a really big crisis and that therefore the spokesperson or CEO or whoever is visible is to blame and that the cause of it is their screwup. The logic is faulty.
The big lesson for crisis communicators and the CEO’s they work for is to understand the soup you are in. What is your environment like? How many enemies do you (your industry, your business type) have that are just waiting for an opportunity to say: See, this is why I hate these guys, this is why they should all go to jail or to hell. The challenge is, you don’t control the soup. But how you operate when things go badly will make a difference when you understand that environment. But just because the crowd jumps up and attacks does not mean the CEO is an idiot, despite what Fortune, LA Times and most other journalists and editors might think.