Why didn't you look up the problem yourself? It's not hard to find and if you're unable to look up a simple abend code on your own, why do you think we will believe you can actually implement any actions we recommend?
Give the program more memory -- S878 is one of the memory problem abends. When you changed the REGION= parameter in your JCL, you either did not give it enough memory -- or you're running in a job class that your site has defined to have limited memory and your REGION= parameter is having no effect. You will have to contact your site support group to determine whether this is true.