Julia Dhar

The second, of course, which I imagine that your investors already spend a good amount of time thinking about is just to be patient.

There are enormous returns on patience in a lot of life, but surely in investing as well.

And so being able to be a good enough judge of whether you're investing over the appropriate time horizon for you, but also for the company.

I try to say to myself, we are always in the middle of the story.

Even if today is your first day as an investor, no matter what, we are always in the middle of the story.

Now, for companies, I think it's completely different.

One of the things that we know for sure now, we now have 50 years of data, is that the return on transformation or big change efforts inside companies

are actually pretty disappointing.

They really consistently, those efforts where an organization says we're undertaking a really large transformation, sometimes it could be something like a merger or an integration of another company, unsuccessful much more often than they're successful.

They fail about 60 to 75% of the time.

the rate of improvement on that is not really changing over the last 50 years, even though we know more and more about how to effectively run a company.

Why is that?

Because companies, leadership teams, investor communities are composed of humans, and getting people to do a big thing together is difficult.

However, and this is why I think it is so important for people who follow a stock, who are investors in companies, to pay attention to this human element.

It's not that no change efforts ever succeed.

Plenty of them do succeed, and it's not random.

One of the things that we, through a really significant body of research on company transformations and on human behavior itself, find is that the companies that consistently pay attention to

the ways in which the behavior inside the organization needs to change and makes it easy to do the things that they have announced that they are going to do are much more likely to be successful.

Of course, we should pay attention to what companies say, their stated plans and intentions and strategies, and we should pay at least as much attention to what they do, what the follow-through on that quarter over quarter is.

It's clearly true that there are moments where a company or an individual leadership team is better or worse at changing.