James “Jamie” Dimon, chairman and CEO of JPMorgan Chase & Co., who has lead his company through several crises, says it’s important to be prepared for tough times in advance.
“You need the army before the war starts,” he says. “And that means a disciplined group; they know what they’re doing.”
Dimon was ranked No. 18 on Forbes The World’s Most Powerful People of 2014, and JPMorgan Chase is the largest private employer in the Columbus region with more than 20,000 employees.
George Barrett, chairman and CEO of Cardinal Health, interviewed Dimon at the Columbus Chamber of Commerce annual meeting in February. Here’s some of what Dimon had to say.
Workforce readiness is a huge issue
The local businesses have to hook up with the local high schools, the local community schools, and say, ‘What do we need?’ And then train the kids so they have jobs when they get out, as opposed to just debt with no jobs.
It’s a big effort. We estimate that 2 million jobs would be filled in the U.S. today had it been done properly.
A quick tour of the global economy
China, in my opinion, will meet its 7 percent expected growth. Why? They have the wherewithal. They’ve got $4 trillion in unused reserves … and they can macro-manage in a way that you can’t in the U.S. Macro-management works when you’re still a developing nation.
They can’t macro-manage forever. They’ve got to broaden out their democracy. You always worry; there’s huge corruption issues. They know about these problems. There are very sophisticated people in that country, but those problems will cause bumps in the road down the road.
Europe is going to be sick for a long time. It’s really hard to get 19 nations to agree to fiscal policies and social policies.
The logic was always good. … And then they came up with the common market. The Euro may have been a mistake. But they can’t go backwards; they’ve got to make it work.
In terms of the economy though, (Europe) will probably do better in 2015 than 2014, marginally. So it’s not a negative on the global economy. And the same thing about Japan; it’s also going through its own growing pains, but it will probably do a little bit better in 2015 than 2014.
The emerging markets are all different. But in total, we’ll be OK. Some will shrink a little bit.
Russia is really confusing. … We all had made the bet that Russia would join the industrialized world, and it had been. And now we’ve had this huge setback.
There are some real dangers in Russia, and so we keep a close read on it. Russia itself will be shrinking this year. They’ve caused themselves huge economic issues.
- I think the most important thing about management is people can speak up. If you ever said to me we didn’t invest in important technology because we couldn’t afford it in the budget, and you didn’t make that clear at the time. Honestly, I would probably pull you aside and say you shouldn’t have that job. Lay it out, all of it, and then deal with it.
- Forget quarterly profits. You make decisions all the time, if you made them just for quarterly profits, you’d be in trouble.
- If you don’t know where you’re making your profit, you can’t make a decision. You may make a decision on something that’s not profitable. I do it all the time. But you will be making the wrong decision if you have no idea.
After the financial crisis
We should recognize that we had a crisis. Part of it was in the financial system, and you need reform.
You need good regulations. And I always talk about having good, not just more. So we support a lot of regulations; we don’t support all of them.
Seek out the bad
Fire the a**holes. I’m sure you’ve all put up with them, but they will destroy your company. It doesn’t take many of them.
We have these meetings, and after the meeting, they say, ‘I’ve got to come see you.’ (They always want to come see you after the meeting.)
You say, ‘Why?’
‘Well, I didn’t want to say it if front of everybody, but …’
Unless it’s really personal or confidential, you say. ‘No, if you can’t say it in front of everybody, you shouldn’t be getting the big bonus you’re getting.’
You’ve got to deal with conflict. Get the issues out. Have constant conversations about it.
It’s easy to say. It’s much harder to do. The CEO doesn’t always notice it himself because they are busy kissing up to you. You’ve got to get around and find out that they don’t respond to Jim — that they sound great here, but they are not serving people there.
Obstacles to U.S. growth
We’re growing at 2.5 percent. It should be faster.
Business is vibrant. We’re adding jobs. We’ve added a million jobs in the last three or four months.
The only difference now is if you ask me why it’s not faster, it’s just reams of bad policy — bad immigration policy, bad tax policy. We’ve had government shutdowns and all these silly things, just shooting ourselves in the foot.
And I’m not going to sit here and blame Republicans and Democrats. I blame them all. To me, we’ve just been wasting a lot of time, pointing fingers and not collaborating.
No road map for CEOs
There’s no road map when you get there. Things are always different than it was for your predecessors. And, obviously, the first goal is to manage the company.
But it’s your job to take care of your mind, your spirit, your body and your family. You’ve got to make a real effort — in all your jobs.
Small and big business are symbiotic
It’s very common to say that small business creates jobs. What ultimately creates jobs are capital expenditures, and in the U.S. I think it’s almost $2 trillion a year … and half of that comes from the Fortune 1,000.
When anyone (builds) a plant, in that plant is so many jobs, and outside that plant is usually five to 10 times that amount of jobs, often in small business.