I hope you'll excuse my somewhat less frequent ramblings in this space over the past couple of weeks.
It is, as you might have guessed, a relatively direct result of my somewhat new role as part-time supervisor and sometime problem-solver for my 8yo, who is, like many kids around the country, learning from home at the moment.
I won't say I have a new appreciation for the work of teachers — my wife is a teacher and trainer, so I have first-hand experience of what she does for her kids — but I certainly have a very new and fuller understanding of just what they do for our kids each day.
And, I should add, with remarkable energy, grace and good humour. (Thank you, Mrs. Rasheed, if you're reading this.)
Indeed, we have been extraordinarily fortunate with the high quality of all of his teachers, thus far.
We're fortunate to be financially able to have the choice to send our son to a local independent school, should we choose. And by all reports, the public schools around us are excellent, but when we arrived in the area 8 months out from the beginning of his first year of school, we visited what was to become his current school and were blown away not by the facilities, grounds etc, but by the passion of the principal and the quality — as much as you can know, from a couple of short visits — of the staff.
So we sent him there.
Happily, that early assessment seems to have been spot on.
Across the school — from the four classroom teachers he's had, to the executive, the support staff, and the rest — we've been struck with the common dedication, care and effort they bring to their work. We couldn't ask for a better group of people with whom to entrust him during school hours.
And it got me to thinking about investing.
(To be frank, as you might know by now, most things do!)
My thoughts turned to both the individuals involved, but also to the staff as a group.
One great person is a wonderful find. A few is fantastic.
But almost all?
That's more than mere coincidence.
Yes, it could be money. Maybe the teachers at my young bloke's school are paid more than teachers at similar schools. Maybe the best people simply end up at the place that pays the most.
It's possible.
It could well be the case.
But I don't think that's it.
Even if it attracted those most motivated by the cash, and even if it meant the school had a high quality cohort to choose from, I don't reckon that's enough.
Some people will work for the highest bidder.
But most of us want more than that.
We want to be satisfied by the work.
A great workplace.
Supportive managers.
The opportunity for development.
Great colleagues.
In short, a great culture.
It's not, by itself, enough.
Money matters.
So does purpose.
And fulfilment.
But culture goes a long way.
It is why, as Peter Drucker so famously maintained, 'Culture eats strategy for breakfast'.
Culture leads to discretionary effort.
It leads to better teamwork, which almost always leads to better work, overall.
It is more likely to attract — and retain — quality people who want to work for the best businesses.
It doesn't need to be overhauled when the competition introduces a new product or pricing strategy.
And it's more than a single product, a single team member or a single idea.
Now, I'm the first to admit it's not the only answer, or an all-encompassing one.
I'm sure there are businesses with bad cultures that have thrived.
I'm sure there are businesses with wonderful cultures that have gone broke.
But whereas most corporate strategies are relatively fixed responses to past-, current and expected future challenges and opportunities, cultures are more like living organisms that change, adapt and grow as they meet their circumstances.
They don't need expensive capital investment. They don't need to be pulled out and replaced when they are past their useful lives. They do need to be carefully tended and fed, of course, but the effort there is cumulative and if it goes bad, usually does so slowly, giving an attentive manager plenty of time to recognise, diagnose and fix the problem.
Lastly, for investors, it is a trait that's not obviously apparent in financial statements or ASX releases. And at a time when there have never been more computers trying to compete away the more easily measurable traits of listed businesses, being able to recognise a great culture can be a great advantage for us mere mortals.
It is, perhaps one of the more important tasks a CEO can have. And cultures invariably come from the top — good or bad.
It is objectively all-but impossible to measure, but I'm almost certain that if you could rank the companies on the S&P/ASX 200 Index (ASX: XJO) by culture, the top quartile would beat out the bottom group by a margin of two or three times, over the long term.
So, by all means, read the ASX earnings releases this month. Spend time with the financials, and understanding a company's market, competitors and strategy. But while you're doing that, look for evidence that might give you some insight into a company's culture.
I reckon, like schools, ASX-listed companies with a good one have outsized odds of rising to the top.
Fool on!
