Warren Buffet's Residence Cost $31,500 and Other Leadership Lessons

I have had a great deal of respect for Warren Buffet since he showed his humanity by openly admitting he had been a bad public speaker and had taken lessons to give himself the skills and confidence to talk to groups.  It's also intriguing, in a voyeurish sort of way, to think about the Oracle of Omaha living in exactly the same property he bought in 1958...coincidentally the year I was born....which therefore seems a long time ago. Somehow, I suspect we may not be getting the full story about his residential quarters, but non-the-less it makes for a great headline and lesson in leadership! 

Indeed, according to Forbes the 6000 square foot home is valued at around $700,000. There may well have been one or two upgrades since I was born!

It's reminiscent of a story I heard when I met with Jim Sinegal, the founder of Costco. In his office, Jim kept the original decrepit desk he used when he started the wholesale giant with co-founder Jeff Brotman. Jim told me he kept it to remind everyone of the virtue of frugality which is easy to forget when every report you receive is denominated in round millions.  These days, since his retirement, Jim's not acting so frugally. He made this point in public recently when he hosted a fundraiser for President Obama at his home in Seattle.   

 

Jim Sinegal hosted President Obama at his Seattle mansion
. Source http://www.king5.com/story/news/local/2014/08/03/13137630/

I think its fair to say that both Sinegal and Buffet have made great use of symbolism over the years, which is indeed a technique adopted by many energizing leaders. Here's some more lessons from Buffet that I extracted from a post by Travis Wright, a Venture Catalyst, and Marketing Technology Entrepreneur. (His post first appeared in Inc, and then Linked-in Pulse)

1. On Risk

"Risk comes from not knowing what you're doing," says Buffett, which means one of two things. You can either be a big risk taker and gambler or you can learn what you need to do, play it a little slower and minimize your risks. Obviously the latter approach is best, but it doesn't lead to instant gratification. Put those multi-million dollar fantasies on the back burner long enough to get in control of your risk factor.

2. On Reputations

"It takes 20 years to build a reputation and five minutes to ruin it. If you think about that, you'll do things differently." This is especially true in the digital era where if something's in writing or on a video, it's forever. You can even take a screencap of a Snapchat, so be diligent when building your reputation--online and off.

Remember Congressmen Anthony Weiner tweeting pictures of his genitalia? Yeah, don't be that guy. His reputation is toast.

3. On Who You Surround Yourself With

"It's better to hang out with people better than you. Pick out associates whose behavior is better than yours, and you'll drift in that direction." Birds of a feather flock together, and you're probably not in the position to be anyone's mentor yet. If you surround yourself with better people, they'll inspire you to do better yourself.

As I tell my children, "If you want to soar like an eagle in life, you can't be flocking with the turkeys."

4. On Hindsight

"In the business world, the rearview mirror is always clearer than the windshield," quips Buffett. Of course, this is true in every other aspect of your life, too. Stop focusing on that rearview mirror, though, after you've gleaned the necessary lessons from it. Move forward, even if that direction isn't quite as streak-free.

5. On Stupid Mistakes

"I bought a company in the mid-90s called Dexter Shoe and paid $400 million for it. And it went to zero. And I gave about $400 million worth of Berkshire stock, which is probably now worth $400 billion. But I've made lots of dumb decisions. It's part of the game."

No successful person is mistake-free, and that's a good thing. Each stumble is a chance to learn and a warning when you're tempted to do something similar in the future.

6. On Knowing When to Quit

"Should you find yourself in a chronically leaking boat, energy devoted to changing vessels is likely to be more productive than energy devoted to patching leaks." In other words, ditch the stubbornness and know when to call it quits. Not every project is worth saving.

Leadership Isn't Easy and Other Business Lessons from an Army Officer

Following on my earlier post about the Full Metal Jacket Leadership style,   I was intrigued to run across this article written by former army officer, Matthew Hamiliton. He identifies four of the great lessons he took out of his service for our Nation which he believes are applicable to the business world.

Image provided by ThinkStock (Rafal Olkis)

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When I was a kid, I didn’t want to be a businessman when I grew up; I wanted to be a soldier. So that’s what I did.

While serving as an Army officer, I was exposed to some amazing leaders and great leadership lessons. Since leaving the Army, I’ve seen those lessons are just as applicable in the private sector and would like to briefly share a few.

1. Give people a purpose.

Giving employees a task is easy. Giving them a purpose is harder, but much more important. Your employees need to understand the why much more than the what.

In the Army, mission orders consist of both a task and purpose. Emphasis is put on the purpose through the “commander’s intent” statement. Giving soldiers a purpose enables them to be flexible and adjust to changing conditions on the battlefield, while still accomplishing the overall intent of their mission.

Think about how your management team gives out assignments. If the only reason an employee knows why they are doing something is “because I was told to,” you may have a problem. Help put their tasks, large and small, in context of your larger organizational mission and situation. As an added benefit, in addition to giving them flexibility, purpose can help increase engagement and lead to more profits.

2. Be precise when you communicate.

Precisely communicating the intent of a mission in the military is extremely important.

For example, there is a difference between attacking an enemy and assaulting one. The differences are subtle and nuanced, but exist nonetheless. Faint variations of language can lead to a big difference in meaning and interpretation.

Think about how many emails you receive in a day in which the writer’s purpose is muddled and unclear. How often have you attended an unproductive meeting because the participants used ambiguous language that left their message indistinct?

In On Writing Well, editorial writer William Zinsser cautions to “care deeply about words (and) master the small gradations between (them) that seem to be synonyms.” Using precise words to convey your meaning will help people understand you.

3. Structure your problem-solving approach.

Soldiers in the Army are often placed in situations where they have to solve complex problems without much leeway for error. While in combat, my helicopter platoon’s priority was maintenance. Without functioning helicopters, we couldn’t accomplish our mission. With limited resources and a long supply chain, we could not afford to make mistakes.

We planned maintenance using the “P4T2” approach – problem, plan, people, parts, tools and time. This helped us to make sure we covered all the bases. Management consultants refer to a structured approach like this as being “MECE” – mutually exclusive, collective exhaustive – meaning you address all the relevant issues without unnecessary overlap.

The P4T2 approach worked for us. Business leaders, however, can benefit by figuring out what problem-solving method works for their organization. Fully structuring your approach before tackling a problem can help ensure you don’t forget something important that can come back to bite you later.

4. Motivate the right way.

I don’t know a single person who joined the military to become rich. Despite this, military service members are consistently some of the hardest working, most respected people. So why is money often the first incentive that many business people turn to?

Soldiers in the Army join, and remain, for myriad reasons. Similarly, many employees are motivated by more than just a paycheck.

It’s your job as a leader to figure out what they really care about. Try to see the world from their perspective, and ask them what matters to them.

Incentives can change over time, too. In combat, the most common motivation for soldiers is to bring everyone home safe. When your organization is in crisis mode, you need to figure out how to focus everyone.

Warning of layoffs may not do the trick, and may send people to look for something more stable. If you build your organization around strong and clear values, that mission can be the rallying cry to pull everyone together.

Leadership isn’t easy. “You can get knocked down, and it hurts and it leaves scars,” said Gen. Stanley McChrystal in his 2011 TED Talk.

Great leaders continue to learn and grow because they know they don’t have all the right answers. “A leader isn’t good because they’re right; they’re good because they’re willing to learn and to trust.”

Matthew Hamilton is a former Army officer and volunteer co-organizer for TEDxBirmingham, matthew@TEDxBirmingham.org.

This article first appeared in the Business Journal in December 2013