Introduction

Different external factors tend to affect the operations of JP Morgan Chase & Co. It is worth noting that the organization has a global presence in areas such as North America, Asia, and Africa. It implies that JP Morgan Chase & Co is exposed to many political factors. In a situation where there is political instability, there are high chances that the profit levels of the group will also reduce. Additionally, political regimes are charged with the role of coming up with policies and regulations that govern business operations. These conventions may either positively or adversely affect the operations of JPMorgan Chase & Co.

General Environment

Under external factors, there is the risk that economic aspects may disrupt the profitability of the group. Cases of economic crises and recession tend to influence investment and saving levels of various organizations. Business Principles (2019) asserts that a reduction in both saving and investment leads to a decrease in the profit levels of a business. In the past, there have been economic crises that have pushed major banks such as the Lehman Brothers Holdings Inc. out of the market. There is thus the central need to ensure that there is the adoption of measures that ensure that the group remains competitive and relevant in the market.

Five Forces of Competition

Competition

Competition with the banking industry is strong, and, thus, exposes JPMorgan Chase & Co. to some problems. There is intense competition from both domestic and foreign market players. Some of the rival firms include Barclays Bank and HSBC. Additionally, customers have a low switching cost, thus intensifying the rivalry level among other market players. Many primary banks are adopting measures intended to pull customers away from JPMorgan Chase &Co. While JPMorgan Chase & Co. strives to protect its position by referring to its long heritage and history, it still faces stiff competition from other market players.

Bargaining Power

The bargaining power of consumers also impacts on the operations of JPMorgan Chase & Co. While the withdrawal of one customer may not have adverse impacts on the global corporation, mass withdrawal of depositors has significant effects on the operations of the company. On the other hand, there is the threat that high net worth individual may switch to other banks, thus crippling the operations of JPMorgan Chase & Co. Business Principles (2019) asserts that the corporation has come up with attractive measures that ensure that it offers attractive packages to customers. As such, these measures have been effective in countering the threat created by other rivals firms.

Evaluation

These efforts are also geared at countering the impacts of other rivals firms. There are also efforts to ensure that existing customers open more accounts, thus attempting to withdraw from the institution to be a bit strenuous. However, the threat of customers switching to other banks is high as many domestic and global financial corporations offer similar products and services.

Future Improvements

There is the opportunity of tapping into the credit card market and other segments that have been sidelined in the past. Under the current setting, there has been the adoption of virtual payments which are mainly done using credit cards. Unlike other forms of payments, credit cards can be used for online transactions in many parts of the globe. These services are common among the young population which also accounts for the most considerable portion of the global community. Tapping into this market implies that the organization would have diversified its operations as well as increased revenue generation levels.

External Threats and Opportunities

Focusing on the corporation indicates that more than 65% of its revenues come from the North America market. The overdependence on a single market creates a lot of danger during an economic crisis. A disruption of the economic growth in the region would translate into a slowdown in the growth of JPMorgan Chase & Co. It further implies that the corporation is vulnerable to the volatile markets. Any incidence of financial crises or rescission tends to affect financial institutions. The other threat concerns regulation measures that limit the ability to venture into global markets.

Threats and Opportunities Strategies

The high level of globalization implies that there is an expansion in the level of the global market, which comes with a high level of competition. Moreover, many unexploited areas offer enormous opportunities for the company Examples of such regions include Africa and Latin America. Not only are the areas untapped, but they also havea high population that provides market to the products.  Moving to these areas implies that the corporation will diversify its operations as well as increase the number of customers. It is only through such an undertaking that the banking institution can boost its revenue levels. Further, the banking corporation has been in existence for an extended period, and, thus, it has a vast pool of resources and experience which can be used in creating active operations in other areas.

Strengths and Weaknesses

The operations of the company are challenged by dynamic regulations and the changing global landscape. Although activities of the company are mainly based in North America, it has active operations in other parts of the globe. It implies that its operations are affected by the volatile political climate that may also lead to currency fluctuations. In countries such as China, the rising pay level can impact on the profit levels.

Strategy

Different measures can be put in place by the management to foster the competitive advantage of the corporation. One of the recommendations is venturing into other international markets. Contrary to the basis of their operations on a single market, there is the need to move in new markets such as Asia and Africa. These markets are underexploited and would offer an ideal opportunity to maximize the operations of the company. Worldwatch Institute (2019) asserts that many organizations are venturing into the global market as the development of online marketing platforms has reduced operational costs.

Resources, Capabilities, and Core Competencies

The corporation can also take advantage of the positive outlook of asset management. Contrary to other market players, the organization has been in operations for many years and also has a large pool of resources. Focusing on global trends indicates that there is a rising growth in the asset management industry. In 2020, the industry is set to reach $102 trillion with a corresponding CAGR of 6% (Leijonhufvud, 2007). The trend indicates that there are huge chances that the corporation will benefit from the expansion of the industry. Unlike other new entrants, it has a vast pool of resources, thus increasing the profit levels. The vast resources mean that there is the option of developing better technologies, conducting market research, as well as moving to new regions.

References

Business Principles | JPMorgan Chase & Co. (2019). Retrieved from https://www.jpmorganchase.com/corporate/About-JPMC/ab-business-principles.htm

Leijonhufvud, C. (2007). Financial Globalisation and Emerging Markets Volatility. The World Economy, 30(12), 1817-1842. doi: 10.1111/j.1467-9701.2007.01077.x

The Role Of Stakeholders | Worldwatch Institute. (2019). Retrieved from http://www.worldwatch.org/node/585

This $10.8 Billion Tech Investment Could Disrupt Banking | JPMorgan Chase & Co. Retrieved from https://www.jpmorganchase.com/corporate/news/stories/tech-investment-could-disrupt-banking.htm

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