Image of a home working environment

5 days working from home isn't optimal for investment teams

Whilst vaccine creation has been the standout technology story during the pandemic it is also important to realise how technology has enabled most developed economies to keep operating, and in fact in some areas, operating even better under lockdown than before.

Tech entrepreneur and software engineer Marc Andreessen composed a thoughtful piece on the way technology positively impacted our lives in the last 15 months. (https://future.a16z.com/technology-saves-the-world/)

He states;

The most profound technology-driven change of all is geography, and its bearing on how we live and work. For thousands of years, until the time of COVID, the dominant fact of every productive economy has been that people need to live where we work………It turns out many of the best jobs really can be performed from anywhere, through screens and the internet. It turns out companies really are capable of organizing and sustaining remote work even — perhaps especially — in the most sophisticated and complex fields.”

He adds;

Its a permanent civilizational shift. It is perhaps the most important thing that’s happened in my lifetime, a consequence of the internet that’s maybe even more important than the internet. Permanently divorcing physical location from economic opportunity gives us a real shot at radically expanding the number of good jobs in the world while also dramatically improving quality of life for millions, or billions, of people. We may, at long last, shatter the geographic lottery, opening up opportunity to countless people who weren’t lucky enough to be born in the right place. And people are leaping at the opportunities this shift is already creating, moving both homes and jobs at furious rates. It will take years to understand where this leads, but I am extremely optimistic.”

I broadly agree but in many roles, including active discretionary asset management, the last 15 months isn’t the ideal template post pandemic. Why? Here are 2 high-level issues with the 5-0 world of working from home that to me have become apparent;

Creativity - missing out on daily spontaneous discussion with colleagues in the office reduces innovative thinking. Interactions with people outside your team can often lead to thought provoking lines of research and certainly act as a potential buffer against confirmations bias. Building new relationships and integrating new staff is very hard on Zoom and any unplanned interaction is very hard to replicate on a video call. The productivity gains of not having to commute are less relevant when compared to this downturn in creativity.

Developing investment talent - Whilst structured programs around skill development can work well in a virtual world, the amount of learning that takes place when a junior PM or analyst spends time listening to senior investors near the coffee machine, on the phone or in the few minutes after or before a physical meeting can be invaluable. Much of this learning is by ‘osmosis’ and unstructured. Moreover, all investors, senior and junior, benefit from informal networking across the firm that genuinely aids a collaborative investment culture.

The pivot to a 5-0 world was impressive and significant. However, I would suggest the 5-0 approach should end and recommend the ‘2-2-1’ approach for investors .

In the office for two days, work from home for two days, and choose between office and home on the fifth day.

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