Investors only look at one side. But…
What are the Multiple Sides?
Every company exists to provide a service or product, and to make money. Profit.
When we look at companies from the eyes of an investor, we see a company, we see its stock price, and all sorts of numbers and metrics about it. We can look up all manners of current statistics and historical records. We make decision based on all of these numbers.
But…
But there are other sides to a company. One other side is how the company behaves from the view of an employee. Another side is how the company operates from the eyes of its customers.
The employee perspective is usually less clear to most investors, and rarely discussed, unless a lawsuit or some enforcement action is involved.
But many end-user faced companies have reputations that accompany them, regardless of their financial results. When the customer is also an investor, a reputation affects behavior.
Personal experience
There have been a few companies that I have been a customer of that affects my long-term investing behavior. For some companies, I invest in and also periodically buy and use their products. Some home consumer products fall in this area. And then there are some companies I invest in that I do not use their products because of personal taste.
But then there are other companies, whose behavior towards me when I was a customer left such a bad taste, that regardless of the market’s assessment, I will never invest in them. In fact, I often go out of the way to avoid their products when shopping. Their customer service, or should I say the lack of caring for customers, turned me off permanently. It’s a shame, but the main way to express my opinion is to vote with my dollars, both for products and services, as well as in investing. And so I do.
As it happens, there are a multitude of companies I will never interact with other than as a [possible] investor. I live in a certain place, so a utility in another location is too far removed from me to have an experience as a consumer. I do not buy most if any industrial products. It is likely only a few consumer products do I come in contact with. Nonetheless, I am affected by the world I live in.
Internal Focus
It seems that so much of many companies’ actions are focused internally to justify its own behavior. Think of so much internal company politics that affects marketing, branding, pricing, customer-facing actions. The customer service representative who talks downs down to a customer who is calling for assistance, or when the rep insults the customer, or behaves badly… none of these behaviors are in a vacuum. A company’s culture permeates its actions. And its actions tell me what kind of a company it is.
How do you assess a company as a consumer? Let me know here.
The bocannon (bocanon) was a mythical beast that appears in many medieval manuscripts that was said to ward off predators and hunters by excreting foul and burning feces. This illustration is ca. 1185. Courtesy Morgan Library (formerly the Pierpont Morgan Library).
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