Short-term performance is the first step toward meeting long-term expectations.
SCHIZOPHRENIA CAN include belief in conflicting myths, and the business community as well as investors are suffering from the symptoms. As a class, directors are obligated to bring balance to difficult situations confronting CEOs and their shareowners. In their oversight role, directors must be on the lookout for signs of unsteady managerial hands that may be temporarily tied by confusion or conflict. The telltale sign is an inability to focus on the longterm view when distracted by short-term performance pressures.
A concerned, perhaps nervous, director might speak up after an earnings shortfall. To peers during a board meeting, such a director might venture: "I think like an investor, and from experience I know the short-term bettors are right a lot of the time. They're voting 'no' on our new announced strategy and the stock price reflects this, it doesn't make me feel very patient either."
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