What On Earth is Jamie Dimon Thinking???
He's thinking about how to compete in the digital era with independent product teams
The Digital Leader Newsletter — Strategies and Techniques for Change Agents, Strategists, and Innovators
A Business Insider headline caught my eye this weekend. Jamie Dimon, CEO of JP Morgan Chase since 2005, is perhaps the most respected CEO in America. But has he lost his mind? OR, does he know a “secret” that we should all consider?
JPMorgan is adding 25 'mini-CEOs' as part of a massive plan to overhaul its 50,000-strong tech organization and pivot the bank to operate more like a startup
In a sweeping overhaul of its technology organization, JPMorgan is transitioning to a product operating model that will have the bank's tech organization operate more like a startup than an incumbent. And executives say the addition of 25 "mini-CEOs" who act like heads of startups within JPMorgan's tech divisions will transform the bank's approach to managing a staff of about 50,000 technologists.
I thought to myself — I’ve seen this playbook before, best executed at Amazon. But why is the world’s largest bank implementing this in their technology organization? What should the rest of us learn from this move?
Conway’s Law is the observation that applications and technology products tend to mirror the organizational structure in which they are created.
Any organization that designs a system (defined broadly) will produce a design whose structure is a copy of the organization's communication structure. — Melvin E. Conway
A solution-oriented organization structure, if done well, creates more customer focus and outcome measurement for teams. Having long-term ownership of customers, products, adoption, and full-stack accountability from product management through support creates differentiated ownership and obsession compared to a project-oriented deployment approach.
This way of organizing tech teams is distinct from ones that start with underlying technology as its first principle and then work to package that into products. Instead, the product-centered approach typically starts with a customer-facing tool — be they internal or external customers of the firm — and works backward to build it. The model often syncs a company's IT efforts and its digital tech products, instead of having the two areas work in silos.
"When we think about all the successes that JPMorgan Chase has had over the last 200 years, we're now saying: 'How do we position ourselves for the long run,'" Monika Panpaliya, the head of JPMorgan's global technology-product office, told Insider. Panpaliya is leading the reorganization of the bank's worldwide tech division(1)
Over time, according to Conway’s Law, this structure should yield stronger products built and operated to deliver the defined capabilities. The structure takes a “service-oriented architecture” concept and manifests a “service-oriented organization structure. But every organization structure has strengths and weaknesses. What are the principles for building smaller independent teams owning core capabilities?
Capabilities for Success
Building from an excellent article “8 Key Principles for Modern Product Development Teams”, here are a few concepts to get right in this organization of small teams working well:
Defined boundaries and accountability. Careful consideration in defining the products and services is key. These can be underlying services (such as cloud computing and tooling used by all) and the end capabilities used by internal and external clients.
Scope of Accountability. Teams should own the entire lifecycle from product management through operations. Published SLA’s, roadmaps, and capabilities help connect these accountabilities across the teams.
Self-Service. This is the killer feature that most organizations don’t grasp as a strategic forcing function. Your products and capabilities should be exposed to both internal and external customers and fully useable without the need for meeting and engagement. Why is this a strategic forcing function? This goal, which might not be fully attainable, encourages the product team to define powerful yet easy products, that are fully discoverable and explained, with competitive features and a strong value proposition. It insulates them from many dependencies, teams, meetings, and other obligations that slow down and distract from their mission. Self-service encourages innovation
Invention comes in many forms and at many scales. The most radical and transformative of inventions are often those that empower others to unleash their creativity – to pursue their dreams. That’s a big part of what’s going on with Amazon Web Services, Fulfillment by Amazon, and Kindle Direct Publishing. With AWS, FBA, and KDP, we are creating powerful self-service platforms that allow thousands of people to boldly experiment and accomplish things that would otherwise be impossible or impractical. These innovative, large-scale platforms are not zero-sum – they create win-win situations and create significant value for developers, entrepreneurs, customers, authors, and readers.
JPMorgan Chase is searching for speed, innovation, healthy debate, and accountability within the business. I wonder if they will follow Goldman Sachs where some pockets of the engineering organization have adopted the Amazon narrative writing philosophy and techniques for debating complex topics?
As it turns out, Jamie Dimon has not lost his marbles. He’s willing to reshuffle the organization and operating model in an effort to compete differently. Are you?
Read the entire Business Insider Article HERE
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This is a newsletter for change agents, strategists, and innovators. The Digital Leader Newsletter is a weekly coaching session with a focus on customer-centricity, innovation, and strategy. We deliver practical theory, examples, tools, and techniques to help you build better strategies, better plans, and better solutions — but most of all to think and communicate better. You’ll be able to follow up with questions and advice.