“When we own portions of outstanding businesses with outstanding managements, our favorite holding period is forever.” Warren Buffett
At last count, I have read more than a dozen books and several dozen articles about Warren Buffett and thus felt well-prepared for this volume, collected and expanded by Carol Loomis, in which she and more than 40 others (including Buffett) contribute their thoughts and feelings about a remarkably diverse range of subjects (including Buffett) from material that was originally published in Fortune magazine from April, 1966 until February 12, 2012 and “still happening.” Included are thirteen cover stories and a dozen articles written by Buffett.
If there were a Rushmorean monument to honor the four greatest business executives, Buffett would certainly be among the candidates. Who would you select? In addition to Buffett, my choices would be Benjamin Franklin, John D. Rockefeller, and Alfred Sloan.
These are among the articles or passages of greatest interest and value to me, also listed to suggest the range of subjects that are explored with rigor and eloquence:
o How Inflation Swindles the Equity Investor (Pages 9-22)
o Berkshire’s Shareholder Contributions (26)
o You Only Swing on 3-0 (42)
o Warren Buffett’s Wild Ride at Salomon (78-90)
o How I Goofed (103-106)
o Gates on Buffett (121-125)
o Interview Excerpt: What’s a Company Really Worth? (143-146)
o A House Built on Sand (152-161)
o Warren Buffett: Revivalist (176-177)
o The Oracle of Everything (204-214)
o Avoiding a “Mega-Catastrophe” (216-220)
o America’s Growing Trade Deficit Is Selling the Nation Out from Under Us (227-234)
o Interview Excerpt: Warren Buffett Gives It Away (256-264)
o Interview Excerpt: What Warren Thinks (272-)
o Buffett’s Mr. Fix-It (297-304)
After reading several biographies, notably those by Alice Schroeder and Roger Lowenstein, as well as The Essays of Warren Buffett: Lessons for Corporate America, Second Edition, edited by Lawrence A. Cunningham, then this one, here is my take on Warren Buffett:
1. What you see is what he deems appropriate but whatever you see is authentic.
2. He is far more interested in helping to build profitable companies that “make a difference” than increasing his net worth.
3. His defining intellectual talent is his ability to absorb, digest, and process voluminous data faster than anyone else can, then apply what he has learned where it will produce the most desirable results. He views “doing nothing” as a legitimate option and, more often than not, the best one.
4. To the extent he is a gambler, he “bets” on people whom he trusts and respects. He agrees with 3M’s then chairman and CEO, William L. McKnight, who observed (in 1924), “If you put fences around people, you get sheep. Give people the room they need.” Consider this passage from Cunningham’s Introduction to The Essays of Warren Buffett:
“The CEOs of Berkshire’s various operating companies enjoy a unique position in corporate America. They are given a simple set of commands: to run their business as if (1) they are its sole owner, (2) it is the only asset they hold, and (3) they can never sell or merge it for a hundred years. With regard to investment thinking, one must guard against what Buffett calls the ‘institutional imperative.’ It is a pervasive force in which institutional dynamics produce resistance to change, absorption of available corporate funds, and reflexive approval of suboptimal CEO strategies by subordinates. Contrary to what is often taught in business and law schools, this powerful force often interferes with rational business decision-making. The ultimate result of the institutional imperative is a follow-the-pack mentality producing industry imitators, rather than industry leaders – what Buffett calls ‘a lemming-like approach to business.'”
5. Finally, his judgment is wholly consistent with his values and that applies to people as well as to business decisions, especially investments. His tastes in food, residences, etc. are not “simple,” as many have suggested. Rather, they are uncomplicated. To an extent few other human beings have, Buffett has spent most of his life in residence where Oliver Wendell Holmes once characterized as “the other side of complexity.”
No brief commentary such as mine can possibly do full justice to the scope and diversity of material in Tap Dancing to Work but I hope that I have at least suggested why I think so highly of it. Also, I hope that those who read this commentary will be better prepared to determine whether or not they wish to read the book and, in that event, will have at least some idea of how the information, insights, and counsel provided by Carol Loomis, Warren Buffett, and their collaborators could perhaps be of substantial benefit to them as well as to their own organization.
Bravo, Carol Loomis. Well-done!Tags: "When we own portions of outstanding businesses with outstanding managements [comma] our favorite holding period is forever", 1966-2012: A Fortune Magazine Book, Alfred Sloan, Alice Schroeder, Carol J. Loomis, Fortune magazine Benjamin Franklin, John D. Rockefeller, Lawrence A. Cunningham, Portfolio/Penguin Group, Roger Lowenstein, Tap Dancing to Work: Warren Buffett on Practically Everything, The Essays of Warren Buffett: Lessons for Corporate America (Second Edition), Warren Buffett, William L. McKnight