Jamie Dimon | Leadership Attributes |

I'm going to go through 11 attributes. The attributes are intertwined. You can come up with different names in different ways. Uh, the only difference in the crisis, by the way, is which ones are more important. The balance changes, but you need all of these to do a very good job as a leader.

You have to be very disciplined. I was not that disciplined. I, I didn't work as hard as my wife here, and I was a little lazy. But when I started working, uh, you have to be disciplined. Discipline is rigorous, detailed meetings, you do it consistently. You have to have a work ethic. It's like exercising or weeding the garden. You don't get there and stop, and the competition is always coming down. It's continuous improvement. You have to always be striving for improvement. Discipline in a crisis, by the way, we would go from once a week risk meeting to three times a day, and from, you know, 10-hour days to 20-hour days. That was the only difference, but the process I'm going to talk about a little bit is the same.

You have to have great fortitude. I don't know who wrote the book, but they talk a fierce resolve. You have to have fortitude and the ability to act. You can be crippled by politics, bureaucracy, and people who just don't want change. When I first got to Bank One, it was quickly clear to me the company had systems problems, management problems. We didn't treat our customers well, our expenses were too high, and to survive and thrive, we're going to lay up a lot of people. The board didn't want to make the changes. The management didn't want to make the changes. Management said it wasn't my fault. I don't know whose fault it was. You have to push back against it. At one point, I cut the size of the board. I went to the management team, we cut 100% of their bonuses the first year. We took away their pension plans, their cars, their clubs. I made a lot of them go with me to every site where laying off people and say, "We're sorry that we put you in a position that we have to lay off people at this company." You have to have the ability to act. You've got to make a list of what it is and then get it done. Yes, orchestrate it, coordinate it. Don't do it in haste. Think it through, 'cause that will backfire too. But for the most part, people simply don't do what needs to be done.

You have to set standards. Standards are not set by Harvard Business School. They're not set by the federal governments of the world. They're not set by anybody. Not set by industries. They're set by you. There are two types of standards you have to set. First one is performance. If you want to really be good, you have to say it. You have to say, "We want to be good, and we drive to be among the best." You have to compare yourself to the best. A lot of companies I go to, when we compare ourselves, they always drop the best company. I say, "Why is that?" They said, "The best company's different. They don't really compete in the same business." I said, "Yeah, they're different. They're good. Put the best up there at a very detail level and say, 'We want to do it.' Analyze why you're different." That includes in performance. Give the customer a great deal. If you're not giving the customer a good deal, you're going to lose. Someone said, "Things come to those who wait." Blinkin added, "Yes, but only those things that are left by those who hustle." You have to set standards of performance, or you will fail.

The second is standards of integrity. I know you talk about it and you learn it. Treat people the way you would treat your parents. That's all. Tell them the product, tell them the service. When they come in the door, say, "What can I do for you?" My parents were here, they say, "You should be treating me a little bit better, Jamie." But, uh, but set the standards of integrity. It's not embedded in anything. A lot of you worked at companies where people said things. It's, I think it's a code word is, "Don't worry about it. Everyone does it that way." No, they don't. No, they do not. And you know, set that standard, and that standard has got to be set at a very, all across all levels. I've been with a lot of kids who lie on timesheets because they took a cab, they shared it from the hotel, you know, to the, to a job interview. They split it with a friend, and they both put in 100% of the cab bill of $40. That's stealing. If I caught you doing that, I'd fire you. And everyone in the company knows that that is stealing. And so the standard is set across the board, from little things to big things. Do the right thing, not the easy or expedient thing.

Fourth, you got to look at the facts in a coldblooded, honest way all the time. At management meetings, emphasize the negatives. You can always have a party about the positives. I used to always go to Hong Kong, party, have a great time. But at management meetings, "What are we not doing well? How come the competition is doing better?" Emphasize the negatives internally. Profit and loss statements are very important, okay? And so a lot of times I get involved in debates about, "Well, you're focusing on little things. How we allocate expenses." It's not a little thing. A lot of companies expense, allocate expenses inside, and the allocation is political, not economic. And you, that, that does two things inside a company. It means your numbers aren't honest. In fact, I've been at a company where people say, "Well, let's move the profits to the part of the company has a higher public valuation." I call that financial misrepresentation. You're teaching your own people to lie. And that goes on in these companies. So P&Ls are very important that way. Aggressive accounting is the same thing. I'm not going to go through a lot of examples. I know I don't know if you still that GE case and the Westinghouse case compares. Did you still do that one? That compares accounting. When people do very aggressive accounting, you, it's in one spot, it's usually a lot of spots. It tells you something about the company. So keep your eye out for that one. Externally, full disclosure. There's only one truth. We try to tell the board the same thing, we tell the employees the same thing, we tell the analysts the same thing, we tell our employees. The good, the bad, and the ugly. And then deal with it. It's okay. We're never going to do everything exactly right.

Number five, openness. Hard one to actually execute because what you really want in a company is full sharing of information. I've worked a lot of companies where you can't simply can't get it. You know, they say, "It's not your job." It is your job. We want to have full information and then have a debate about the right thing to do. Have the debates on what the information is. Bad information leads to excessive politics. People have often said to me, "Okay, Jamie, you're the big boss, you get paid the big bucks to decide. Now decide." My experience has always been that if you get the right people in the room, the answer is often waiting to be found. You don't have to guess. The job of a leader is not to make the decision. It is to make sure the best decision is made. And therefore, you need other people.

You have to kill bureaucracy. I think that bureaucracy is a, is the petri dish of politics. It pushes out good people. You lose touch with the customers. It often emanates from headquarters. If you go to headquarters of companies, I think headquarters are often the disease. And you see the receptionist treating the employees badly or their customers badly. You probably have a company that has a problem. Headquarters don't exist except the fact that there's a client in front of someone somewhere, whether it's a Benihana or whether it's a JP Morgan Chase. And, uh, you got to deal. My Home Depot, the best example is they call store support center. I'm more of that mind. Move people in and out of corporate to make sure they know. It's like they have the job on the firing line, and then they have a little more respect for the job on the firing line.

Deal with key issues. I always make a list on Sunday of all the issues I'm trying to avoid, and I write them down, and I try to deal with them on Monday. I avoid them half the time. Come up with good reasons not to do it, but, but I try, try to get them, uh, down. There are signs of, uh, politics when you see these. I'm sure you've all seen them. When you have a meeting, you share information, and after the meeting, people line up outside of your office saying, "I didn't want to say this in front of everybody, but..." That's politics. Now, of course, they can tell you something confidential, but most of the time it should have been said in the room with their partners. And I tend to tell people, "If you can't say it in the room, you don't deserve the job." Say it politely, say it reasonably, but say it because we're only trying to do the right thing for the company or the clients.

One point, we had a conversation about compensation. We actually reviewed the top compensation, a lot of people. And someone said, "You're going to make us all go through all the compensation of all the top people?" I said, "Yes, I am." And the person said, "Well, don't they work for me? Don't I know what they contribute to the company?" I said, "No, they don't work for you. And how do you know if they contribute to the company unless you ask your partners?" And we have open conversations about whether our people doing a good job for each other. We don't do it to hurt anyone. We do it for fairness and insight. And get into the field. Whatever people say, get into the field. Do it all the time. Have a little fun. Take the Ops clerk to dinner. Go have drinks with the tellers. You'll learn more about your company all the time. You do something like that. Cut across hierarchy. When you're in companies, that hierarchy is another disease. Be polite, but hierarchy is generally artificial. As I said, with most units in companies, all serve each other. And so cut across the hierarchy. Just make sure your boss doesn't fire you for it.

Um, always get the right people in the room. If you're designing a system, have the people going to use the system there. Give them the authority to say, "If this doesn't work for you, the tellers or the clerks, then we won't do it." So they get fully engaged in building everything that the company does all the time. And the last thing to openness. Someone said to me once, "You know, there's truth tellers." Someone stood up in a big crowd and said, "Every one of you has to make sure that at least one of the people around you is a truth teller. They always tell you the truth." And I got up and said, "Yes, you got to make sure that there's at least one truth teller around you. But if you are a leader and you have seven or eight people reporting to you, and you have only one truth teller, you have a problem." Every single one of them should be a truth teller.

You have to set things up for success. Give you a quick example from my past. When we did the Citigroup Travelers deal, we had multiple trades and multiple co-heads reporting to trades and co-heads. That is a formula for disaster. So organize things that will actually work in the future, not things that won't work in the future.

Loyalty, number seven. Meritocracy and teamwork. Words you all hear. I'm going to give you a slightly different point of view of them. When I was a young CEO, someone asked me, "We love the company, but you demoted Joe. You embarrassed him. How can we be loyal to you, which we, which we asked for, for which I believe in, when we're not loyal to Joe?" And I honestly couldn't answer the question. And I went home that night and I thought about it. And I called the person up the next day. I said, "Yes, you were right. We demoted Joe, and Joe is a pillar of society and a wonderful person. And yes, we did not want to embarrass him, but Joe was no longer doing a good job. If we were quote loyal to Joe by leaving him in that job, we would have been hugely disloyal to everybody else and the clients of the company." And that, by the way, is the hardest job you are going to face right there. Doing the right thing when it may be removed. Don't embarrass someone. I think it's one of the great mistakes when people embarrass people all the time publicly who've worked hard for a company. That is a terrible thing to do.

Um, if you, if you are loyal to Joe and not the company, you do not have a meritocracy. I remind people, we talk about diversity. Joe is usually a middle-aged white guy. So if I tell you we're going to give the best job to the best person, okay? I'm not telling the truth if you don't see me make changes. So a meritocracy is the fundamental part of a meritocracy. And teamwork. Teamwork is often code and it means get along. Whereas often, I think the best team player is the one who puts up the hair and says, "I don't agree because I don't think what you're doing is in the best interest of the client or the company." So teamwork sometimes means standing alone and having the courage to say something. I deeply believe in loyalty. Deeply. And I dealt hard with the contradiction about making tough decisions like that. So what is loyalty? If you deeply believe in it, what do we owe employees of a company and each other? Here's what we owe you. We owe you, I'm going to talk about this a little bit later, that we're going to build, do everything we can to build a healthy and vibrant company because that will give you the most opportunity. We want to build a company that's respected by people because that means you will be respected. We want to give you the training you need. We want to treat you with dignity. We want to give you opportunities. If you fall down, we want to pick you up and help you. That's what we owe you. We do not owe you that job. And that is what loyalty means.

Number eight. Great mistakes are not made in the name of morale. Very often, morale that people means writing down words. You're going to treat people with dignity and loyalty. We're going to do all these wonderful things. We're going to hold hands and sing Kumbaya. The road to hell is paved with good intentions. One of my first jobs, I was at a company, I would go and named that had a terrible morale problem. They spent hundreds of thousands of dollars in a survey to ask what, you know, to check into morale. I, of course, being a little obnoxious at my young age, said, "I could have saved you the money and told you morale was bad." Now, morale was bad because people considered the place political and bureaucratic. So I defined the management team came up with an idea. The idea was, and they convinced themselves of a great idea, they gave every employee $300 of restricted stock to show that they care and to give them a vested interest in the company. They gave out the $300 of restricted stock. Months later, they surveyed morale again. It got worse. And I'm going to make a very simple, common sense example and why it got worse. And this is business is just common sense sometimes. If you walk up to me and say, "Jamie, your company is political and bureaucratic. I don't like working here. I would never recommend having a friend come here." I look back and say, "Oh, yeah? Well, here's $300. What do you want us to do? Fix the problem." We can't buy your loyalty, and we certainly can't buy your morale. Morale comes from fixing problems, earning respect, and winning. I always remind people, show me a very bad company that loses all the time, I'll show you bad morale.

Number nine. Treat all people properly with respect. Treat them all the same, whether they're clerks or CEOs. I find it very upsetting. I, some must mention, yes, Jamie, that's true, but you treat them more badly sometimes, but don't treat them well, but treat them equally. Uh, everyone serves everyone else in a company, from that receptionist to that teller to the Ops person. And we should always acknowledge that we serve people. If we don't return our phone calls, they're not going to return them. So I always remind myself that anything I'm doing for them is because they have a client in front of them. Promote people respected. Ask yourself a question. You promote people, would you have your child work for that person? Because half the time we promote people, we would not let our kid work for them. And you should really question about why you allow something like that.

Number 10. This is one of the hot topics. Get compensation right. So get the incentives right. Build the P&Ls right. Get the incentives right. But I always remind people that our company, I don't care what the P&L says or what the incentive system says, do the right thing for the client anyway. That's never a bad excuse for bad behavior. Companies, even big companies, we need entrepreneurs. So we have to accommodate thoroughbreds. People want to make money. Innovators. And so we have to make sure we comp, we have that inside our company all the time too. To get compensation right, you have to acknowledge that failure is okay. We want people to fail. I think they're good mistakes. You know, you argued it, you thought it through, you talked to the right people, and you were wrong. And so you have to allow failure. Compensation, a little bit of a partnership. Internal fairness is often far more important than anything else that takes place. Performance is hard to judge. All this thing about somehow we should have an easy job judging performance. When we judge people's performance, we don't just look at that P&L. That financial statement is a snapshot of a point in time. That's based upon decisions and actions taken by a lot of people over 10 years. We look at, did you work hard? Did you hire people? Did you train people? Did you do the right thing for a client? Do you help other people? Did you build systems? When we ask you to do something like recruit, did you help us or do you not show up at somebody these recruiting sessions? So we, we judge the full spectrum of how people perform. And then the greatest misconception of all is when a unit doesn't perform, don't blame the boss. I mean, don't pay the boss well. Sometimes you, you want to give your best person the worst job. I've asked a lot of people to go do a job that I know is going to be the hardest turnaround, the meanest job, 24/7, that they're not going to look good doing it. And you know, I say to them, "I'm going to pay you the same as the rest of your partners, and I've got your back. I'm not going to allow the politics inside to hurt you. If something goes wrong, we're all going to get an airplane and come help you." Very often in companies, when there's a problem, people go running as far and fast as they can in the opposite direction. Whereas when we have problems, we want the good people to run to say, "I can help." And we often protect them on comp when they do something like that. Performance also deeply, always ask this question. Has to look at the rising tide and the cycles. Don't let that fool you all. That's a false sense of security. And that's some of what happened in this crisis of ours, which I'm not going to go through here. The CEO is the captain of the ship. When CEOs are hired, sometimes they have a guarantee or a buy-in or something like that. I think it's very short. That's okay. When I got to Bank One, I had a one-year guarantee. I'd hire a bunch of people. One point in the year, they came to see me and said, "Jamie, we can't do the job." They had one-year guarantees too. I've almost never hired someone for more money, a multi-year guarantee, or a bigger job. I don't bribe people to join the company. If I have to bribe you, I don't want you. You want to come build a great company? Love to have you here. They came to see me and said, "We're not going to take our guaranteed pay because we can't do what we have to do and travel around and make these tough decisions." As they're walking out, they looked back at me and said, "And by the way, we don't think you should take yours either." And I think they were exactly right. At one point, you're the captain of the ship, and it doesn't matter anything other than you've got to say, "I'm part of the ship, and I will be paid with it or not. You should be the first to pay a price."

Number 11. Have real humility. Humility, by the way, is not a, people that say, "Jamie, you don't sound humble a lot." Very humble. Very often, humility is a deep acknowledgment that we got here by the dent of sometimes where we were born, who our parents were. It wasn't all our genius and brains. Maybe we could have been in a different place with a disease that we couldn't handle. Have you, you will have awesome power that affects people's lives. Use it wisely and be just on it. If you do all this in leadership, you can end up with a mature company. And one of the great lessons I learned, and there's a book about everything you want about management, you learned in Shakespeare. I don't know if you guys teach that here, but it's true. I look at some of these companies, and they're more like Shakespearean tragedies than you teach at Harvard Business School, where neurosis and politics dominates internally. Ring read King Lear. That's what it looks like to me half the time. And what you want is a mature company. And the mature companies, and I can name some, Walgreens, Toyota, Tata, Nokia. I go around the whole, in every business, they're constantly getting better. They're constantly getting good people. They always do the right thing. They always focus on the customer. It's not constant German. When they change CEOs, the company doesn't blow up five years later. You want a mature company, not a Shakespearean tragedy.

Third, your obligations. Our obligations to our companies and our societies. Some of these are my values, so you may very well disagree. That's fine. First of all, you are very lucky. Just, we should all acknowledge that. Warren Buffett always gives an example of a barrel. That there are almost 7 billion people on this planet, and that, you know, most of the people on this planet, if they can take where they are or stick their hand in and be somebody else, would stick their hand and be somebody else. You can have the, in the United States, we open the doors. We might have three billion people who want to come here. We are very lucky. A lot of what we're good at, we were born with. Um, and that gives us deep obligations. Leaders understand that they didn't build this country. I speak to a lot of my friends, remind them, they didn't charge the beach at Normandy or do the Hanvey in a desert in Iran or a mountain in Iraq. So everything they earned, they did not earn it on their own. Somebody earned it before they got here. And that should be a humbling thing for all leaders. If you want to be a leader, it can't be about money, and it can't be about you. It's about eventually what you do, when you, when what you leave behind, and what you did when you walk the planet. Teachers, politicians, scientists, generals left this planet better than us. And someone said, "I'll tell you what I think about it." Said, "What would you want on your tombstone?" Think about that when you become a leader. What do you want on your tombstone? So here are three of the important things to me. I was asked once in China by a reporter, "What's really important to you?" And I started talking about the company. He said, "No, no, what's important to you as a person?" And I said, "In this order: My family, humanity, my country. Somewhere down here, JP Morgan." And I do mean that in that order. And I'm going to explain why. The family you brought into this world, that the people who love you the most, you love the most. Uh, I've always spoken about giving them, uh, time. The only advice I'm going to give you at all, for family at all, or friends, and this is more to the men than to the women here: Turn off the TV. You don't have to have dinner with your buddies all the time. Your vacations belong to your family. Your weekends belong to your family. You got to do that, or you will lose them. And the reason I don't devote all my time to my family is because, as you all know, your kids eventually don't want to see you anymore either, and they all go have their own purpose in life. So I tell people, the best that I could do, the best that I could do, I think, is build this company I run as best as I can, and the best I can do for, for the country and for humanity. The road to hell is paved with good intentions. I am devoted to making JP Morgan a healthy, vibrant company. And people ask me, "What's the most important thing to you?" Making this company healthy and vibrant. I will make enormous sacrifice to do that, because if I don't do that, I'm hurting our employees, our customers, our families, our communities. We are a very terrible company. We give away $100 million a year. We pay for our vets when they go over, when they're called back to duty overseas, we pay their full salary. We invented ATMs for the blind. We teach inner-city school kids. When the hurricane, the tsunami, the earthquake hit, we immediately sent money and aid. And I speak for a lot of companies. We are a very good company, but it is all predicated on being healthy and vibrant. And sometimes people forget that and they let the company become sick, and then you're hurting all these things. So I spent a lot of my time making sure we can do all these wonderful things by making sure the company is healthy and vibrant.

Finally, humanity and country. We're going to get through this crisis. So I'm not going to talk at all about the crisis. And I think America is a great. I'm wildly optimistic about the future of America. It is still one of the shining lights on this planet. It has been, and it will continue to be. But I am deeply troubled by the notion that success is a given. It is not a given. And this country has a lot of things it has to do. And policy, policy is something that you all going to have to start to work on to make sure we do things right all the time to serve humanity. And I'm talking about America, but I think it applies to all countries. We all need to do things that make the planet better. In the United States, for example, we have had our third energy crisis, which is an environmental crisis. The reason we have it is we do not have the fortitude to make decisions that other countries made a long time ago to tax energy. We come up with a lot of things that aren't going to work. And the one thing that will work, we won't do because we don't have the fortitude. We, in the United States of America, and I know it's true for countries around the world, half of the kids who graduate inner-city schools, half of the kids in inner-city schools don't graduate high school. That is a disgrace and an embarrassment, which we're going to have to work hard to fix. So I remind people that it's okay to share the wealth. I don't mind paying taxes. I would mind paying more taxes, but I also very careful as we get involved in these things that we don't destroy, destroy the wealth by having bad policy. Bad policy can do that. I think Harvard Business School graduates can spend a lot of time making sure we have very good policy. The world needs your help. And you did mention it was a defining moment. I think it's a defining moment in terms of politics, the Middle East, America, and the President of the United States. It is a defining moment. But a house divided doesn't stand. So I think we all need to do as much as we can.

Many years ago, I'll leave you with two last thoughts. One last thought, and I'll tell you my, I want my tombstone to say. Many years ago, I read an article in the paper that was written by a Medal of Honor winner, person who ran a Medal of Honor on Normandy Beach, June 6th, 1944. And the person said something like the following: "I wish I could have gotten it for this, but I only remembered it this morning." Person said, "I will never forget that day or the people who died by my side. I am so proud of them, though I don't consider my medal earned by just me." He said, "But now I'm 70 years old. I'm looking back at my life, and I realized the people who deserve a medal are the people for 70 years, day in and day out, were good parents, good friends, helped the sick, helped make it a better world through thick or thin, all the time, in little ways and in big ways." And that's how you are all going to add to this planet too. So my tombstone, actually, my, not my tombstone, I'm not going to sure I'm going to put my tombstone, but I hope people say, "We're going to miss the so and the world is a better place from having been here." So thank you. Congratulations. God bless you all. Godspeed, and help make it a better world too. Thank you.