Why cultures fail: The power and risk of Groupthink
Abstract
Why do terrible things happen under the watch of good leaders? Why do very smart, dedicated, well-meaning leaders make horrific mistakes? Can these problems be foreseen? How and why do these problems happen? How is it that a robust system of checks and balances designed to prevent these situations fails? Are these problems likely to happen again? In this paper, the power and risk of Groupthink is explored by examining two cases (London Whale and Sales Practices) at JPMorgan Chase and Wells Fargo. Through specific examples, the paper demonstrates that what happened at these organisations can happen in any company.
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Author's Biography
Yousef A. Valine is an award-winning author, and Executive Vice President and Chief Risk Officer of First Horizon National Corporation. He has leadership responsibility for oversight of risk management and compliance activities across the firm. Prior to joining First Horizon, Valine was Executive Vice President of Wachovia Corporation for 24 years. He served as the head of the Institutional Risk Group and also as Chief Operating Officer of the Risk Management Division.
Citation
Valine, Yousef A. (2018, September 1). Why cultures fail: The power and risk of Groupthink. In the Journal of Risk Management in Financial Institutions, Volume 11, Issue 4. https://doi.org/10.69554/VRCD4199.
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