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Final Artifact – Capstone II

Jon Guerrero

Capstone II

Jennifer Guerra

December 2, 2022
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For the final research paper, we will discuss one of the issues J.P. Morgan Chase faces

throughout their business. There are a number of issues the company faces like inconsistency of

customer satisfaction reports, bankers not using the tools they are provided properly, or that

customers are not investing as much at J.P. Morgan Investments and rather going with

competitors such as Fidelity, Edward Jones, or Merryll Lynch. For this topic, we will go with the

inconsistency of the customer satisfaction reports and how they can be fixed to achieve a high

level of customer satisfaction most of the time. We will discuss how the theories we review

correlate to the customer satisfaction report.

The main theorist we will look into is Elton Mayo and his Human Relation Theory. This

theory came to be when Elton Mayo and Fritz Roethlisberger conducted the Hawthorne Studies

to see how workers felt about the work they did. Under the scientific management style by

Frederick Winslow Taylor there was at the time, workers were treated like machines. They were

given payment for their labor, they had so much work to do throughout the day that needed to get

done, and they were provided the tools to do it. Truly basic work what the style of management

wanted at the time. What Mayo and Fritz discovered after the Hawthorne Studies is “that

employee perceptions—they feel they belong to a group, their manager pays attention to them,

and they have a role in making decisions about their work—is paramount, and worker

productivity increases significantly” (Keene, 2022) when these things are in place. It just makes

sense to have these things in place if it will boost productivity and your employees are satisfied

with their job. Even more so, the workforce today actually has the advantage to looking into jobs

that satisfy their needs whether it is working from home, hybrid, compensation, vacation time

and sick time. These days if the employees find something that they want like better benefits,

work from home, or higher compensation, they will not hesitate to leave the company.
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These Hawthorne Studies opened the door to other theories that are still in use today. The

Social Exchange Theory by Homans is a great example. The Social Exchange Theory “is one of

the primary theories in the organizational behavior literature. SET has been used as a theoretical

explanation for job performance, organizational support, intra-organization relationship, trust,

personality research, organizational commitment, job satisfaction, turnover, justice, workplace

safety, and other aspects of leadership” (Zoller and Muldoon, 2018). Every organization today

uses some type of Social Exchange from Human Resources Department when they do the hiring,

to the Sales Team going out to meet clients, to the Data Analyst figuring out what the data means

and setting up meeting with other teams. These interactions within the organization matter to the

employees and affects how they do their job. It is important for executives and managers to look

into providing their employees with what they desire to keep the productivity high and turnover

low.

The second theorist that we will discuss is Henry Fayol and his Administrative Theory. In

this theory, Henry Fayol wanted to create a theory that would generate better managers. Fayol

was observing Taylor’s Scientific Management Theory and thought that people and machines

needed to be treated differently. He started out looking into his career and found what made him

successful and began creating this theory. He determined upon his research the “universality of

administrative processes, and from this belief he argued that society in general would benefit

from the study of management fundamentals at all educational levels” (Lynch, 2021). Fayol

came up with 6 characteristics that good managers have and 14 principles of good management.

He wanted to teach this in school so that there were more managers readily available when they

graduated and moved into the workforce.

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In today’s universities and work trainings we still see some of the principles he mentions

in his theory. Lynch mentions that Fayol “broke the managerial process into five basic elements:

forecasting and planning, organizing, commanding, coordinating, and controlling” (Lynch, 2021)

which is similar to what we have learned in the Organizational Leadership courses we are taking

today. In the Management Theory courses we learned about the P-O-L-C Framework, which has

the same principles of planning, organizing, leading (commanding and coordinating), and

controlling as the 5 basic elements of the managerial process by Fayol. So even today, there

seems to be a lot of Fayol’s teachings going on in managerial courses and management schools

and that are still applicable today.

Even businesses keep using the Fayol theory in use. As stated by Rodrigues in Fayol's 14

principles of management then and now: a framework for managing today's organizations

effectively, “not all organizations, for example, small organizations, government agencies,

churches, large steel makers, apply this contemporary framework they continue applying the old

Fayol framework. The research is also likely to reveal that many modern organizations do not

apply all 14 contemporary principles, and that many organizations apply some principles more

intensively than others” (Rodrigues, 2001). This makes sense as every business is different. They

get to pick and choose which principles work for their industry. Fayol also generalized what was

needed with the 6 characteristics for a good manager that is still in use in job posts today.

Employers are now looking for candidates to be of good judgment, adaptable, have integrity,

general education, specialized training, and basic computer skills. This has also adapted a bit

from industry to industry over time, but it is generally the same as Fayol had described.

The third and last theory we will consider is Douglas McGregor’s Theory X and Theory

Y. McGregor considered that the way businesses conducted their operations were through
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Theory X. This theory has the idea that managers have to micromanage employees or else they

will not get work done because “employees are assumed to have little ambition and avoid

responsibility, preferring a secure, base work environment” (Miller, 2020). With this in mind,

they think workers are easy to manipulate and like to be told what to do because they are not

very bright.

However, McGregor believed that there was another way to do things and he came up

with Theory Y. Theory Y is friendlier to the employees. This approach considers that employees

will do the work if their needs are taken care of. Theory X takes care of their necessities like

payment, food, and shelter. Theory Y goes beyond that and offers employees valuable work

experiences and satisfaction of getting the work done. Doing something that will fulfill them and

their careers, and not told what to do and be threatened if done a different way.

There is a misconception though when it comes to these two theories. It is often believed

that Theory X is wrong, and Theory Y is correct. However, McGregor was working on Theory

Z, a version of Theory Y in which he aimed to address the idea that Theory Y was

always positive (Ungvarsky, 2020). He was probably trying to combine both theories and

formulate a better one, but he passed away before completing Theory Z.

Even today his theories continue to make an impact on the world. Theory Y is the most

often used especially in places like Google and Facebook (Miller) where they give employees the

freedom to perform their tasks and also provide them with a more relaxed outlook on the

workplace. More and more organizations are starting to use Theory Y as a basis for treating their

employees. Especially after the pandemic where employees saw they were needed the most,

there have been added benefits to employees entering the job market. Employers are trying to
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make it more appealing to the applicant rather than the other way around like it has been for the

longest time.

The company that we will be analyzing is J.P. Morgan Chase. J.P. Morgan Chase is

headquartered in New York City but has branches across the United States of America,

excluding Alaska and Hawaii, as of August 2021. The firm has a over two hundred fifty

thousand employees worldwide. The employees range from tellers, bankers, loan officers,

lawyers, call center representatives and more. As an employee, I can say that I feel satisfied with

my role at Chase. They look out for their employees, they pay fairly according to the market, and

their benefits are also respectable.

One of the current issues J.P. Morgan Chase faces across the nation at the branch level

and the customer service line is the inconsistency of customer satisfaction report. The customer

satisfaction reports are the surveys customers take the time to say how good or bad of a job the

representative that took care of their needs did. For the most part, customers will not take the

time to respond to the survey unless they are either really happy or really upset about the service.

There have been inconsistencies regarding these satisfaction reports and management thinks it

may be caused by how the new hires are getting trained. We will take a deeper look into this

issue of customer satisfaction report, how they correlate to the way new hires are trained and the

theories chosen for this paper. What we hope to achieve is to decrease the turnover rate for the

company, achieve a high level of customer satisfaction report at all times and take care of the

employees of the firm to keep excelling in their careers.

The theory that I think best fits the issues at hand is the Human Relations Theory by

Elton Mayo. This theory presents the idea that it is the interpersonal experiences that the

employee has within the organization that make them work harder and give more to the
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workplace. The better the employee feels they are connected, valued, and engaged by peers and

managers, the better the improvement of the overall company. This is proven to boost employee

morale and the total output the employees produce for the company.

There are somethings that can be taken away from the other two theories as well. With

the Administrative Theory by Henry Fayol, his five basic elements for the managerial process

could still be useful when training new hires. If you have new hires coming into the firm and

training them with the skills you want the managers to have, then it would be beneficial to the

firm to have employees that think like management. Elements of Theory X and Theory Y can

also be added to the discussion about fixing the issues of the inconsistency of the surveys. It is

good to be demanding of those employees that are not meeting the standards of customers or the

firm. By taking into consideration all these factors we can focus on the recommendations to fix

this issue.

What I would recommend to J.P. Morgan Chase to use the Human Relations Theory by

Mayo and use it to train the new hires moving forward. By using this theory along with the

Social Exchange theory, the job satisfaction for employees will go up which in turn leads to

greater production or output. When employees enjoy what they are doing, and they feel

acknowledged from their managers or supervisors they tend to perform better than when they go

to a job that they hate and would rather be somewhere else. I would suggest also that employees

fall on each other for help when situations arise where a customer might be feeling agitated or

upset at a situation.

Personally, from my time working at Chase, I have seen where customers get upset when

they do not get their money after depositing a check. What they do not understand is that there

are rules and regulations the bank has in place to protect the customer but to protect itself as
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well. You could do everything right and customers will still give you a bad survey just because

you were not able to release a hold on their check or cancel a transaction right then and there

when they forgot about a payment they had done. What we can do is minimize these trends in

inconsistency by training the employees in how to handle certain situations and also pairing them

with someone who has been in the firm a little while longer who has gone through the training.

Providing the employee with great working conditions, compensation, teamwork, good

supervisors, and benefits will make them enjoy the work they are doing and do not have to dread

going to work daily.

By applying these recommendations to the training of new employees, we can guarantee

that they get the skills they need while also making sure they know how to take care of

customers’ needs. Within the call center, I got to train two classes before moving to the branch.

The classes were comprised of 22 and 24 students respectively, and it was four trainers per class.

What I would try to explain to them is that beyond all, customers look for someone who will

listen to their problems and someone who can help with those problems. People in general want

to be taken care of whether it is the employees or the customers. Beyond that customers would

more likely give them a good review. By providing them with a supervisor (me and the other

trainers) guiding them through the training, they got better after each call. Most of the calls at the

call center are repetitious so after a few calls, the information just flows.

At the branch it is a little different, you are face to face with the customers, but you also

have teammates to back you while at the branch. What my supervisor does for us now is that

whenever we have a customer who we sensed had a bad experience, we are to get their

information and provide it to him with an explanation of the situation. He will reach out before

the end of the day and talk to them about their experience. Hopefully, this interaction will push
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for the customer to give better reviews. So social interactions both with the employees and the

customers as well.

Henry Fayol’s Administrative Theory also plays a role with hiring and retaining top

talent. When you hire new people to work banking and customer service, they need to have

certain qualifications like customer service, good judgement, and integrous. These principles

from Fayol help the employee excel in their work and usually they already have a bit of

background on how to treat others. Even more so, if the company was looking to promote from

within, these individuals would already have what the firm is looking for since they were in-

house trained.

Essentially, my recommendation is for organizations to take care of their employees.

People generally think of the phrase “the customer is always right” and they make the employees

take a back seat when it should be the other way around. Personally, if I feel I’m taken care of, I

will do my part and take care of the customers. By picking and choosing from the different

theories is also valid. Not one organization is the same. What works for one might not work for

all. Creating a cookie cutter solution is not an option. Taking the time to formulate great decision

making, taking care of your people, and providing the right tools will make any organization

succeed.

Overall, these theories opened the door to how management looks at individuals. Now

thanks to those theories, companies are doing more for their employees like paying living wages,

offering benefits, paying for education, and so much more. Employees as well are being more

productive, taking trainings to enhance their skills, give more back to the organization than they

were doing before. We still have a long way to go, but things are certainly looking good for the

future of companies and employees

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References:

Keene, B. M. (2022). Human relations movement. Salem Press Encyclopedia.

Lynch, R. G. (2021). Fayol Publishes General and Industrial Management. Salem Press

Encyclopedia.

Miller, S. (2020). Theory X and Theory Y. Salem Press Encyclopedia.

Rodrigues, C. A. (2001). Fayol’s 14 principles of management then and now: a framework for

managing today’s organizations effectively. Management Decision, 39(10), 880–889.

https://doi.org/10.1108/EUM0000000006527

Ungvarsky, J. (2020). Douglas McGregor. Salem Press Biographical Encyclopedia.

Zoller, Y.J. and Muldoon, J. (2019), "Illuminating the principles of social exchange theory with

Hawthorne studies", Journal of Management History, Vol. 25 No. 1, pp. 47-

66. https://doi-org.ezproxy.southtexascollege.edu/10.1108/JMH-05-2018-0026