Wednesday, March 18, 2009

Outsourcing jitters for JP Morgan

Americans are now outraged by the news that their banks are quitely shipping thousands of jobs overseas. The latest target is JP Morgan Chase. Press reports originating from India suggested that JP Morgan is working out a $400 million deal to outsource jobs to India. Interestingly, the US press did not get a whiff of the plan.

Reports have led over three dozen members of Congress to write to the bank to explain the outsouring plans. JP Morgan received $25 billion in bail out money from the TARP fund. The Congressmen have written in a joint letter to the bank that "“taxpayers of the United States of America contributed $25 billion to your company to help stabilize our economy – not send jobs overseas.”

Some bloggers were quick to call for all Americans to close their account with the bank. "Hello America!Its time to take a stand.If you really feel like you're being screwed by these big money boys, then quit whining,do something.If you have an account with chase, close it tomorrow.The only thing they understand is their bottom line.We need to let them know that enough is enough," wrote a blogger on

Another blogger's posting said, "if the story is true, you, Chase, should be ashamed. Ashamed for considering outsourcing during these troubled economic times. Ashamed for letting the story get out from India, not the U.S. Shows me a total disregard for corporate etiquette and responsibility."

JP Morgan has not offered a comment on the matter so far.

What will be a responsible act in this situation? Should JP Morgan keep jobs in the US and forego cost savings from outsourcing? Failure to cut costs will make the bank's survival even more difficult. JP Morgan is a global bank. How should it deifne its stakeholders? Should it consider only Americans as its stakeholders, because it's headquartered in the US? Or should it consider a wider worldwide stakeholder base because it's a global bank?

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