Learnings from the life of Warren Buffet

Warren Buffet is one of the world’s richest men. He is one of the world’s most successful CEOs as the CEO of Berkshire Hathaway. He started his company with $10000. His stake is worth billions and billions of dollars. But even more importantly, he is a respected leader. Even though he could buy anything in the world, yet he is so stable and grounded. Warren Buffet’s success has been unique as he has all through worked for creating value for the stakeholders. In this era, full of distraction and disruptions, he has consistently been leading without a title and has always been concerned about uplifting the people around than thing about himself. Here are few learnings from his life which will really help reconnect you with what it means to be a true leader and what it means to play your absolute best both in professional as well as personal life.

1.      Have a passion for your craft: Practice your craft, do something that you are passionate about. Genius is not genetics. Genius is much more about persistence around a specific craft for an extended period of time, along with daily practice of your craft. “Love what you do”. Find ways to be passionate about what you do and where you are today. You can find ways to be passionate about what you do even if you are in the most seemingly ordinary, mundane job. Passion is the fuel that allows you to play at world class. Passion is contagious. Everybody around you will feel your passion and you passion will allow you to keep going when you might not feel like you want to keep on going.

2.       Recognize opportunity amidst adversity: Your market is there to serve you, not instruct you. Warren Buffet does not worry about the cost of the stock, he is more concerned about value investing. When people are afraid, that’s when you want to take risk. When everyone else is afraid, the market place is there to serve you. People drop into an emotion called fear during disruptive times. And because of fear that clouds their lenses, clouds their judgment, they miss opportunities that people who can manage fear well seize and become successful.

3.       Be a specialist: Greatness is all about obsession. An intelligent obsession. All great man had a burning obsession that got them out of bed every single morning, even in the darkest of days. Concentrate on vital few. Focus, Focus, Focus, as Confucius said, “A man who chases two rabbits catches no one. Another great management guru, Peter Drucker puts it as “There is nothing so useless as doing efficiently that which should not be done at all.” A focused mind block out the noise, block out the distraction and helps leave the realm of mediocrity and takes you on the road of mastery.

4.       Wait for the right pitch: Run your own race. Sit back and wait for the perfect swing. Warren Buffet says, his job is allocating capital. And all he do every day is sit back and wait for the perfect swing.  Most businesses actually fail because they had too many good opportunities. And rather than waiting for those few perfect pitches, those few perfect opportunities that were right for them to seize and them mine, those businesses that failed focused on too many good opportunities and they resigned themselves to mediocrity. They tried to seize every great opportunity, every perfect pitch that came their way. They did not have their discipline to understand which few opportunities were perfect for them to focus. Wait for the right pitch and just because everyone around you and your competitors are saying this is the best opportunity of a lifetime does not mean that you should seize it. Learn the discipline to wait for those few perfect pitches that are right for you and your business.

5.       Be a devoted daily learner: Warren Buffet spends 75% of his day in learning. The best of the best are curious. The best of the best are all looking forward for that next best idea that will give them a competitive advantage and elevate them. Focus on value versus cost. If you love reading, read, do not worry about the cost of the books, do not worry about the cost of learning, do not worry about the cost of seminars. If you look at the richest, happiest, most successful people in the world they are daily learners. They are always learning.

6.       The Warren Buffet Test: Warren Buffet has made sizeable investment in Gillette, the pioneer of razors. He understood that this is not a company that will be gone in a few years or even a few decades. What Warren Buffet focuses on is “Does the company have a Durable Competitive Advantage (DCA)”. DCA is knowing that one thing that you can do that no one else can do and focus on it to the point of obsession. Innovate and invest on it every single day by 1%. That is one of the great secrets of business and career success.

7.       Bet on tortoises versus the hares: Last mile excellence is the key. It is so important not to start the race strong, but to finish at world class. If you look at the Olympians, it is not only how you start. But what makes a champion is how strong you finish. Warren Buffet always bet on companies that have strong inherent value. He “Stick with things”. He looks at the fundamentals and then he does not worry about them.  The point here is  play the long game, figure out that you can be great at, stick to your fundamentals  and then be like the tortoise, steadily focusing on making small improvements every day. Always be focused and know what your mountain-top is, following your values, sticking to your fundamentals.

8.      Protect your good name: It could take you twenty years to build a great reputation and five minutes of bad judgment to lose it. Use the Newspaper Test, measure your life and your performance at work by the newspaper test. Warren Buffet ask his managers, how would you feel about doing an action if you knew it would be written up the next day in your local newspaper, to be read by your family, friends and neighbors and written by a smart but unfriendly reporter.  If you are wondering whether you should do a certain action or make a certain choice, use the newspaper test. Would you want your behavior or that choice to show up in the newspaper, to be read by your near and dear ones? There are many examples of leaders who had spent their entire careers often doing great works and then, through one act of bad judgment performed on a particular day, they lost everything. Always protect your good name.

9.       Live your life backwards: This is very powerful. It is like reading your own obituary. Alfred Nobel was one person who had read his own obituary. It was a mistake made by the newspaper publisher, when Alfred Nobel’s brother died, Alfred Nobel’s obituary was published and he was aghast to read what people thought of him as it was just opposite of what Alfred thought. This completely transformed his life and he worked really hard to get himself on track and post this Nobel Prize were instituted. While we all may not be lucky enough to read our own obituary, but it would be worth-while to live your life backwards. Assume you are 70 years old and live backward to your present day and align your actions to match your achievement at the age of 70.

10.   Your inner-scorecard versus your outer-scorecard: What’s in your inner-scorecard is more important than what is in your outer-scorecard. Authenticity is key. There will never be a better you than you. Being comfortable in your own skin is key. Authenticity is one of the competitive edge. Being authentic means you are transparent. Warren Buffet says that it is a waste of time worrying about what the world around you is going to think about you. Be so strong in your values, your own vision for the future, your own genius abilities that you block out the noise from the chattering voices of your neighbors. Always measure your success by your inner scorecard, not by your outer scorecard.

11.   Focus on creating value versus materialism: Always be obsessed with value creation. What keeps Warren Buffet up at night is creating value for the stakeholders of his Company. This is his singular focus. It is not stroking his own ego. It is not lining his own pockets. He has got the skin in the game. He makes money through his own shares and his own stake by increasing in value through his excellence in investing.

12.   Shift from focusing on success to significance: Every second that you are focusing on being successful is energy taken away from your legacy. Do not worry so much about success. Success takes care of itself when you are more concerned with helping people.  Think about being significant for people. Think about being a really good and honest person.

To sum up, Warren Buffet is a living example of a leader who has always stayed focused on the fundamentals, created value for people, protected his reputation and has been innovative for the benefit of the people who gave him business, and one can relate all the above when you see his achievements. Pick up few of the learnings from above and implement in your life, you will see that over time you will succeed beyond your imagination. 

Source : Learning from The Snowball : Warren Buffet and the business of Life by Alice Schroeder

            Learning from Robin Sharma's article

            

Self-Leadership

Great leadership is a cultivated art. It begins with self- leadership. Because at the center of leadership is the person who, more than anything else makes the difference. Leadership success or failure begins with how the leader approaches self-leadership. Self-leadership is the practice of intentionally influencing your thinking, feeling and behaviors to achieve your objective. Self-leaders have a drive for autonomy, can make decisions, are more creative and persist, even in the face of adversity. Here are few points on the qualities of self-leaders which distinguishes them from others:

Live for something bigger than yourself: Great leaders do what they do because it makes a difference to others – whether customers, employees, citizens or society at large. Mediocre people ask the familiar question: “What’s in it for me?” Great leaders are not selfless. Their selfish interest is to feel good about themselves because they made a difference to someone else. Life is too short to play small with your bigness. Great leaders takes it as a personal obligation to run their mind like a superstar and takes natural responsibility to be great.

Choose who you spend your time with (your association): No man is an island. We are influenced every day by who we spend our time with. Human being are emotionally contagious. We model the people around us and behave like the people we spend time with. Great leaders spend time with people smarter than themselves, whom they can learn from – whether it’s working for the right organization or hanging out with friends on weekends. Every bit counts. They live a contrarian life. Greatness is a self-improving cycle. Mediocre people surround themselves with other mediocre people – they don’t want to feel threatened.  Mediocrity is a self-sustaining prophecy.

Confront the facts – yet keep the faith: Great leaders are always dissatisfied and passionate. They remember that no matter how good things are, there’s always a better way. Great leaders are also resilient and persistent. No matter how bad things seem at the moment, they believe in their ability to control their destinies and overcome their challenges. Mediocre people are content with status-quo. If things are going well, that’s good enough; if they’re not going well, it’s for reasons beyond their control.

Be authentic and simplify: Great leaders would rather be authentic than artificially popular. Great leaders simplify how they deal with the world by focusing on fundamental principles. They will deal with people and situations flexibly, but base their judgment on principles, not convenience or popular culture. Great leaders reduce the amount of clutter in their lives – by not wanting too much, and by finding and developing the right people to empower and delegate to. Mediocre people complicate things. They’re forever chasing the latest fad, buying new things to show off, and never learn to empower others.

Discipline eats “freedom” for lunch: Great leaders understand that discipline is the balance between their rights and their responsibilities. They will demand their dues, but do more than their bit. Mediocre people over-correct to one or the other. Some are vociferous in demanding their rights, and will explain failure by describing how they’re being denied their rights. Others will forever wait for instructions, and won’t use their right to think different.

Stay relevant: Technology is both accelerating our productivity and threatening our very reasons for existence. Younger workers are more aware and smarter than we were when we began our careers. Great leaders keep current with technology and surround themselves with smarter and younger people they can learn from. By doing so, they multiply the impact they have on their ecosystem. Mediocre people stick to the old ways of doing things until technology risks their jobs. They feel threatened by the younger, smarter lot, and try to compete on rank and seniority until the inevitable happens – the young and restless win!

Self-leadership is an ongoing process of self-reflection. Continual self-leadership is a mark of leadership maturation. Personal leadership is a never-ending work in progress that draws on continually maturing self-understanding. Some people never mature as leaders — they remain insecure, self-defeating, juvenile or worse still, delinquent in their leadership development. And like all leadership skills, self-leadership skills can also be acquired. No matter what age, stage or circumstance in life, anyone can become a better person, a better leader. Self-leadership is imperative if we want to be great leaders.

Source: Good to Great by Jim Collins

             Compounding Effects by Darren Hardy

             Articles by Robin Sharma