The Real Struggle in IR: Short-Term vs. Long-Term

Read this on our blog.

“The reality is the market judges companies every 90 days, and companies are building great businesses for the long run. Ideally, you can find investors who are investing for that longer-term story and want to get in now versus when it happens.”

Debbie Hancock , a veteran IRO

Debbie and I were catching up recently, and she shared this. Her words stuck with me. Whether it's personal or professional, we all wrestle with the never-ending challenge of balancing the short-term with the long-term. For IROs, though, this tension is practically part of the job description.

So how do you make that balance work? Here are my 2 cents based on conversations with Debbie and other IROs. And at the end, Debbie shares a few more pointers.

The Problem With Short-Term Thinking Alone?

Let’s think of an athlete running a marathon. If they focus only on sprinting through the first few miles, they might feel great initially but burn out long before the finish line. In IR, focusing solely on the short-term—like quarterly results—can leave you unprepared for the long haul.?

Short-term wins feel good today, but often at the expense of long-term growth. Sure, you might meet this quarter’s expectations, but are you telling the long-term story your investors really need to hear?

Common Short-term Traps:?

• Chasing quarterly targets: Pouring energy into hitting earnings while losing sight of the bigger narrative.
• Managing stock price reactions: Over-focusing on market volatility, leaving little room to discuss long-term strategy and potentially confusing investors.

Next, let's dissect this...What Do You Miss With Long-Term Thinking Alone?

On the flip side, focusing too much on the future can leave you out of touch with today’s realities. Having a long-term vision is crucial, but if you ignore current performance, you risk losing investor trust.

Picture a company constantly talking about future innovations while failing to explain a revenue dip this quarter. You’ll quickly lose credibility if you seem disconnected from present challenges.

Long-term Traps:

• Avoiding tough decisions: Solely focusing on future goals can lead to delaying necessary actions today, like dealing with underperforming units.
• Missing out on investor feedback: Being too focused on long-term plans may cause you to overlook valuable insights from what investors are saying now.

Balancing Both

The real art of IR lies in balancing short-term execution with long-term vision. It’s not about choosing one over the other—it’s about using short-term wins to support the long-term strategy.

Debbie had some great insights to share here:

“One thing I think is really important is that short-term messaging should support long-term goals. Long-term minded investors are always thinking, ‘How do I know you’re making progress toward these goals?’ Share your milestones for the journey and communicate them along the way to show you’re moving forward.”

She also emphasizes consistency:

“You can’t keep changing your long-term story or goals based on what’s working today. This is where many struggle—the long-term feels far off, but constantly changing your story works against building the long-term narrative. The reality is, long-term goals will probably change, but it should come across as an evolution, not a pivot.”

So, How Do You Approach It? A Couple of Pointers:

1. Connect short-term performance with long-term goals. Show investors how quarterly results align with your company’s long-term vision.?
2. Make hard decisions today, guided by long-term goals. Don’t avoid tough choices. Align short-term actions with the future you’re building.?
3. Communicate consistently. Keep investors updated on both your immediate moves and long-term vision to build trust and credibility.

And then, my final thought

Short-term and long-term strategies are two sides of the same coin. Focusing solely on quarterly wins can make you seem reactive, while ignoring today’s realities for a distant future can erode investor confidence.?

In IR, your role is to tell the full story—a narrative that balances today’s performance with tomorrow’s growth.

Essential picks for IROs

Here's a McKinsey article I found while researching today’s ST/LT piece—covering the equity story you need to attract the right long-term investors.

We may not have a crystal ball, but I appreciate how Brian H (CIO, BOKF) breaks down the market outlook for the end of 2024.

?? Found this newsletter through your network? Subscribe to get it in your inbox.

???What we do:?OUTKREATE transforms Investor Presentations for Public Company IROs. We enhance narrative, content, and design to help you achieve your IR goals.

?? Schedule an IR Presentation Assessment, and we’ll walk through your deck together, offering actionable feedback to elevate your story, content, and design.