J P Morgan Chase & Co. SWOT Analysis

Strengths

J P Morgan Chase & Co is one of the most successful business service firms in the United States. JP Morgan Chase is a business company with $ 1.2 trillion in assets and about $ 106 billion in shareholders equity which shows its strength as a financial institute.

J P Morgan Chase & Co is one of the oldest business services firms in the world and operates both banking and non-banking subsidiaries.

With revenues of $ 56.9 billion in the US and 160,000 employee pool, makes J P Morgan Chase & Co a leader in business services providing firm in the US. It is said to be the 3rd largest banking institution in the United States.

J P Morgan Chase & Co operates on the national as well as international level. Therefore, its market share is not restricted to just one region or country.

The company currently operates in over 50 countries worldwide and still able to meet the objectives and needs of clients effectively.

J P Morgan Chase & Co has a superior reputation; their knowledge to attract and keep its personnel and the attractiveness of their products to their consumers adds to its strengths greatly.

J P Morgan Chase & Co signed a $5bn Outsourcing agreement with IBM.

It also formed a merger with Bank One Corp. to encourage self-sufficiency and cost reduction by employing a do-it-yourself approach.

Weaknesses

The IT infrastructure of J P Morgan Chase & Co was not sufficient in maintaining their systems in their business operations.

The cancellation of outsourcing agreement with IBM resulted in Transferring of employees to IBM’s payroll, in employee anger and loss of productiveness of the company.

New consultants had to be brought in by the company to assist in implementing the outsourcing strategy and in serving employees finished the transformation which caused additional expenses to be incurred by the company.

There was seen a decrease in productiveness due to a heavier workload for existing employees.

Employees lost their jobs on the restructuring back into J P Morgan Chase & Co. The merger with Bank One created 12000 layoffs.

Opportunities

The outsourcing agreements that the company undertakes from time to time could make it more competent by resulting in cost reduction and increasing quality.

The agreement with IBM and other leading companies would create significant value for clients, shareholders and employees.

The merger with Bank One led to the accomplishment of a large retail banking presence. Therefore, helps in increased capacity to manage its large business infrastructure.

Bringing IT backwards in-house from IBM would assist in fixing the slummy economics of J P Morgan Chase & Co.

Threats

The company faces threats from number of competitors because of operations in over 50 countries, both globally and regionally.

The fact that IBM could supply its services for numerous companies of the size of J P Morgan Chase & Co and hence, increase their competitiveness.

Employees having to do additional work, having salary reductions and re-application processes for their jobs could cause the men to be de-motivated and retrograde productivity.

The success of the merger approach with Bank One is not guaranteed.

The possibility of newborn firms entering into the business affects competition, not only a firm’s present rivals pose a threat to the business alone.

A danger of substitutes exists that the JP Morgan Chase’s customers might find less expensive and hence, their product’s demand is affected by the price change of a substitute products.

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