Studying this chapter should provide you with the strategic management knowledge needed to: • 1 D... more Studying this chapter should provide you with the strategic management knowledge needed to: • 1 Define organizational structure and controls and discuss the difference between strategic and financial controls. • 2 Describe the relationship between strategy and structure. • 3 Discuss the functional structures used to implement business-level strategies. • 4 Explain the use of three versions of the multidivisional (M-form) structure to implement different diversification strategies. • 5 Discuss the organizational structures used to implement three international strategies. • 6 Define strategic networks and discuss how strategic center firms implement such networks at the business, corporate, and international levels.
, CEO of JPMorgan Chase, is one of the very few top executives at large banks or major financial ... more , CEO of JPMorgan Chase, is one of the very few top executives at large banks or major financial services firms who was unscathed by the substantial economic recession which began in 2008—a recession largely caused by those firms taking inappropriate risks. He is described as charismatic and an excellent leader. Yet, in 2012, JPMorgan Chase experienced its own scandal caused by exceptional risk taking. Traders in its London operations were allowed to build a huge exposure in credit derivatives that breached the acceptable risk limits of most analytical models. As a result, the bank suffered losses of more than $6 billion. It is referred to as the London Whale trading debacle. Because of the huge loss and concerns about the lack of oversight that led to this debacle, there was a move by shareholder activists to separate the CEO and chair of the board positions, requiring Dimon to hold only the CEO title. Playing key roles were the American Federation of State, County and Municipal Employees (AFSCME) and the Institutional Shareholder Services (ISS). The AFSCME was pushing to separate the holders of the CEO and chair positions at JPMorgan Chase. The ISS was pushing for shareholders to withhold the votes for three directors currently on the Morgan's board policy committee. Dimon described the London Whale debacle as an anomaly caused by the inappropriate behavior of a few bad employees. However, it seems to suggest serious weaknesses in the bank's oversight of activities involving significant risk. Executives and board members of JPMorgan Chase worked hard to thwart these efforts. Lee Raymond, the former CEO of Exxon Mobil who has been on the Morgan board for 25 years, played a key role in these efforts to support Dimon and avoid a negative vote. They lobbied major institutional shareholders, and even asked former U.S. president
Studying this chapter should provide you with the strategic management knowledge needed to: • 1 D... more Studying this chapter should provide you with the strategic management knowledge needed to: • 1 Define organizational structure and controls and discuss the difference between strategic and financial controls. • 2 Describe the relationship between strategy and structure. • 3 Discuss the functional structures used to implement business-level strategies. • 4 Explain the use of three versions of the multidivisional (M-form) structure to implement different diversification strategies. • 5 Discuss the organizational structures used to implement three international strategies. • 6 Define strategic networks and discuss how strategic center firms implement such networks at the business, corporate, and international levels.
, CEO of JPMorgan Chase, is one of the very few top executives at large banks or major financial ... more , CEO of JPMorgan Chase, is one of the very few top executives at large banks or major financial services firms who was unscathed by the substantial economic recession which began in 2008—a recession largely caused by those firms taking inappropriate risks. He is described as charismatic and an excellent leader. Yet, in 2012, JPMorgan Chase experienced its own scandal caused by exceptional risk taking. Traders in its London operations were allowed to build a huge exposure in credit derivatives that breached the acceptable risk limits of most analytical models. As a result, the bank suffered losses of more than $6 billion. It is referred to as the London Whale trading debacle. Because of the huge loss and concerns about the lack of oversight that led to this debacle, there was a move by shareholder activists to separate the CEO and chair of the board positions, requiring Dimon to hold only the CEO title. Playing key roles were the American Federation of State, County and Municipal Employees (AFSCME) and the Institutional Shareholder Services (ISS). The AFSCME was pushing to separate the holders of the CEO and chair positions at JPMorgan Chase. The ISS was pushing for shareholders to withhold the votes for three directors currently on the Morgan's board policy committee. Dimon described the London Whale debacle as an anomaly caused by the inappropriate behavior of a few bad employees. However, it seems to suggest serious weaknesses in the bank's oversight of activities involving significant risk. Executives and board members of JPMorgan Chase worked hard to thwart these efforts. Lee Raymond, the former CEO of Exxon Mobil who has been on the Morgan board for 25 years, played a key role in these efforts to support Dimon and avoid a negative vote. They lobbied major institutional shareholders, and even asked former U.S. president
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