Develop a corporate presentation based on a SWOT analysis, strategies for maximizing competitiveness and profitability, a communications plan, and an assessment of efforts related to ethics.

BUS499 Business Administration Capstone

Dr. Kellar

05/18/2020

External and Internal Environments

Introduction

JP Morgan & Chase Corporation can create value that is substantive in the Finance industry that is very competitive. This can be done as the organization can make significant innovations and forge a path that is different from those taken by its biggest competitors in the industry of finance. The organization chooses to set their services apart from other competitors by giving the customers value through quality and customer service that is superior. Unlike most of its competitors, JP Morgan and Chase expands its operations and explores opportunities across the world to maximize its profits as well as ensure that the needs of the customers are met.

General Environment

Technology

Technology in the form of financial technology plays an important role in the success of JP Morgan & Chase Corporation. The organization has grown significantly from e-commerce, mobile electronic payments, cybersecurity, big data, and enterprise development of the cloud, among other technological developments. The organization keeps up with the emerging financial technologies to secure the organization's success by taking part in technology investments to stay ahead of their competitors (Farrell et al., 2018). For instance, the organization made an $11 billion investment in technology that has the potential to disrupt the banking industry, which potentially places JP Morgan & Chase at the top of the finance industry.

Economics

Economics significantly influences the success of JP Morgan & Chase in the sense that it has a direct effect on the organization’s generation of profits. The economic decline in the world brought about by the COVID-19 Pandemic has affected the operations of the organization affecting their economic status with the negative effects suffered by both clients and investors. This is because the Pandemic has crippled markets and some areas of the global economy have been brought to a halt, the bond yields for the government dropped to the lowest level, and the prices of oil collapsed (Ozili & Arun, 2020). This has posed major challenges in developing strategies for investment for the organization.

Five Forces of Competition

The five competitive forces are the bargaining power of suppliers, new entrants, competitive rivals, substitute product threat, and customer's bargaining power (Nurlansa & Jati, 2016). JP Morgan & Chase is faced with a number of these competitive factors, but the major ones are the threat of substitute products and competitive rivals.

Competitive Rivals

Competition from rivals in the industry is the most significant force against JP Morgan & Chase as it faces competition from three main banks in the united states that are money centers as well as international banks like Barclays and HSBC. The competition gets intensified further by the low costs of switching from one bank to another, especially in commercial and retail spheres of banking. JP Morgan deals with this threat by offering client services that are cutting edge, low costs, and convenience, acquiring banks that are smaller to eliminate competition and using experience and history to distinguish itself in the market (Donnellan & Rutledge, 2019). This force is still experienced by the organization with the continued growth of the finance sector.

Substitute products

The threat of substitutes of products is another issue that JP Morgan faces as other companies that are outside the industry of banking have begun offering the financial services that only used to exist in banks. Some of these include PayPal, prepaid debit cards, Apple pay, among others. This costs the company and other main banks a lot of loss in revenue. JP Morgan has addressed this force by establishing a division that lays focus on lending for small businesses.

Future Improvements

There are several ways through which JP Morgan Chase can address the two competitive forces discussed above. The organization can address the issues of competition from rivals by establishing services and products that are unique as well as establish a strategy for marketing that would attract a large following of customers as well as retain the customers that are already members of the organization (Donnellan & Rutledge, 2019). The organization can come up with new products that will be exclusive to it to ensure that there is less competition against their product in the market. The threat of the introduction of new products to the market can be addressed by JP Morgan & Chase by creating products that will meet the demands of their clients in terms of quality and affordability to curb the market competition for new products.

Greatest External Threat

The external threat that JP Morgan & Chase is facing is competition from international organizations that keep expanding and creating new products (JP Morgan Chase & Co., 2019). This is a threat to JP Morgan as the competition could lead to a significant loss of its clients to the international organization. The threats that are external that the organization faces are from the competitors are due to the operations it carries out in over a hundred markets. HSBC and Barclays are the major external threats that JP Morgan & Chase faces. Barclays is a threat to JP Morgan because of the great position it holds in the U.K. business and retail banking, as well as its large customer population of small businesses. The position of Barclays in the United States markets poses a significant threat to JP Morgan & Chase. The financial crisis, the recession, and changes in international regulations are also significant threats that are most likely to harm the operations of the organization.

JP Morgan & Chase can deal with its greatest threat, which is the competition from international players in the banking industry by maximizing its strengths and finding solutions to its weaknesses. The organization can address its weaknesses by adopting technology that would help them avoid issues like breach of security that can potentially lead to exposure of client data to malicious persons. This threat affects the opportunities for the corporation as the potential clients would refuse to be part of the organization due to the fear of the breach of privacy. Also, the organization could lose its clients as they would no longer feel safe in the organization. This threat would eventually lead to a negative outcome in the organization's economic position. The organization has the opportunity of exploring its crypto-currency (JPM coin) that helps in settling payments in its business for wholesale payments between clients (Russon, 2019). The greatest opportunity the organization has is that with the increase in the use of credit cards across the world, JP Morgan can expand its geographical reach to help expand its global reach in market share.

Greatest Opportunity

The greatest opportunity that JP Morgan &Chase has is associated with the new technological developments in the market that provide JP Morgan & Chase an opportunity to practice a strategy for practice that is differentiated in the new market (JP Morgan Chase & Co., 2019). This will play a significant role in helping the firm provide great service that will enable them to maintain their loyal customers and attract new customers through other propositions that are value-oriented. The organization can make use of this opportunity by integrating it into the opportunity that arises from the new consumer behavior trends in the market that can significantly open up a new market for JP Morgan & Chase to explore. This will provide an opportunity that is great for the organization to diversify into new categories of the product as well as build new streams of revenue. JP Morgan & Chase can best take advantage of this opportunity by using technology to improve their dealings, interact with customers through social networking sites, and market their products through the various platforms. This will also help significantly in setting it apart from the competition, improving customer relations, and increasing their profits.

Strengths and weaknesses

The greatest strength that JP Morgan & Chase has is the fact that it is the largest American bank and also the oldest institution for finance in the United States, dating back to about 200 years ago (JP Morgan Chase & Co., 2019). Another strength is that the organization has a global reach with markets that are over 100 in number. It enjoys a financial position that is strong and has recorded strong business performance over the years. The organization has also managed to buy back about $40 billion of its stock, potentially raising the share earnings per share in 5 years to about 3% higher. The increase in sales of volumes of credit cards and the rise in the portfolio of the core loans in 2018 also significantly strengthens the organization (Sweet, 2018). The organization’s share in the market has significantly increased in most of its businesses.

Expand the client base

To take maximum advantage of the strength which is being the largest, the oldest and its global reach, the organization can take advantage of this to expand their client base and create more opportunities to establish reliability and convenience for their clients as well as attract more clients. This will help them stay at the top of the competition in the market.

The weaknesses that are most significant in JP Morgan& Chase include the controversies it has been facing for failing to protect the finances of their clients, which led them to face legal issues. The issues of overcharging clients, which it admitted to and the glitch in their technical operations and its online system of banking, experienced a challenge to security, allowing account data for some users to be accessed by other users.

Adopting the latest technology

The strategy the organization can put in place to fix its weakness of failure to protect the client's finances is by exploring and adopting the latest technology (Jili'ow, 2017). This will ensure that the financial records of the clients are well managed and the privacy of data guaranteed to gain the trust of their clients. Providing a guarantee for the safety and privacy of the information for the clients plays a significant role in building trust and thus improving the relationship between the clients and the organization.

Resources, capabilities, and core competencies

Resources

The most important resource for JP Morgan & Chase is human resources, and it is essential for the success of the bank under the leadership and management of Jamie Dimon, who is the president, chairman, and CEO of the organization. The organization has over 250 000 employees across the world, which enables the organization to meet its management and strategic objectives and goals. The organization makes use of its technological resource in creating an edge that is competitive in the market (JP Morgan Chase. 2019). The financial gains and resources get acquired from its six business lines, which has made use of it to become the largest in the market.

Capabilities

The capabilities JP Morgan & Chase have are inclusive of its ability to become a leader in the six business lines it operates. These lines of business include education and auto banking, insurance, consumer banking, home finance, small business banking, and financing of retail. It boasts as a leader globally in the management of assets through groups of clients that are distinct through client services that are private for clients with high net worth and retail and institution clients (JPMorgan Chase. 2019). It is the provider that is leading to mortgages and loans for home equity.

Competencies

The core competencies for JP Morgan &Chase are in their brand name and service to customers. Its integrity and experience, based on the fact that it has been operational for about 200 years, are the reason it is leading in the banking industry (JPMorgan Chase. 2019). The global reputation it has gained across the world is the reason that drives it. Being the bank that is the largest in the U.S. Its brand name, JP Morgan & Chase, and the base for customers has placed it in a position that is competent in the market.

Conclusion

JP Morgan & Chase is a global leader in banking and finance, which has been made possible over the years by the fact that it has a unique organizational structure and strategies that are different from those of its competitors. However, the main basis of its growth and success is the fact that it has experience of many years which has made it familiar with the financial trends in the market, helping in their development of strategies for their success. What makes it unique is the expansion of its operations and exploration of opportunities in ways its competitors do not.

References

Donnellan, J., & Rutledge, W. L. (2019). A case for resource‐based view and competitive advantage in banking. Managerial and Decision Economics, 40(6), 728-737.

Farrell, D., Greig, F., & Hamoudi, A. (2018). The online platform economy in 2018: Drivers, workers, sellers, and lessors. JPMorgan Chase Institute.

Jili'ow, A. (2017). MARKETING PLAN.