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Posts Tagged “Warren Buffet”

Warren Buffett has stated, “Somebody once said that in looking for people to hire you look for three qualities: integrity, intelligence, and energy. And if you don’t have the first, the other two will kill you. You think about it; it’s true. If you hire somebody without integrity, you really want them to be dumb and lazy.”

My philosophy about hiring employees is this: I don’t want employees at all. What I want is peers with a congruent value system to share a personal and business journey. I want co-workers in a horizontal company who can teach me and make me a better human being and businessman. This means everyone, including the receptionist.

This journey begins with common values, particularly seeking out executive business associates who want their work to give back to the world through service and truth-telling to customers and potential customers. Under that rubric of shared values, I have always wanted to only hire executive colleagues who are better than me at both genuine caring for the client and creating efficacious results, in that order. However, the truth is we are all better and worse than each other in our variegated ways.

To me, the staffing ideal is a company that affords all associates the freedom to maximize their own service instinct and acumen with minimal interference from the big, bad boss (me). I’ve found that this philosophy makes for an enlivened, creative company and a happy business community. It incentivizes and vivifies autonomy as a core value.

Etymologically the term autonomy derives from the Greek word meaning self-governing. To be autonomous means to act in accord with oneself. When we are autonomous we all emanate service and salesmanship infused with energy, integrity, and a personal authenticity that sells at all points of contact with the public and with stakeholders.

Authenticity is compelling. Like the judge who, when asked to define pornography, said, “I can’t define it, but I know it when I see it.” Customers feel much the same way. They know authenticity when they see it. Stephen Colbert famously calls this quality “truthiness.” I see incentivizing “truthiness” in every associate as a primary leadership imperative. You want to activate truthiness, not just because it is moral, but because it is effective.

Therefore, part of incentivization is hiring people who innately share corporate values so they are always, without thinking, succeeding by propelling a corporate narrative from inside themselves. In my case I have hired educated, value-oriented, experienced people who are adults and self-starters.

Of course, everyone works for money. That has to be fair and appropriate. But I firmly believe that passion and commitment are not fundamentally incentivized by money. They are better motivated by a will to generosity, happiness, and autonomy.

As said, “Success is not the key to happiness. Happiness is the key to success. If you love what you are doing you will be successful.” (Herman Cain frequently appropriated this quote when he ran for President of the US in 2012.)

Thank you, Albert.

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The 19th century humorist Josh Billings once said, “The difference between successful people and really successful people is that really successful people say no to almost everything.”

Seth_Godin_in_2009Business guru Seth Godin said no to me last week.

One of my fellow entrepreneurs who follows this column has told me over the years I should meet Seth; that we shared a simpatico trope and were fellow travelers. So I sent Seth Godin an email inviting him for a cup of coffee. Here is his reply.

“Thanks, Tim.

Alas, I hate meetings and have figured out how not to do them. I’m sorry but we’ll have to be fellow travelers from afar.

Good luck with your work and with your new book.

Seth”

So much for meeting Seth Godin.

Nevertheless, the rejection of my invitation got me thinking about the art of saying no in business and in life.

Like most active entrepreneurs I am always up to my ass in alligators–looking for 48 hours in every day. I really try to live a balanced and mindful life of revery, quality time with my daughter, maintaining an open servant’s heart to my clients, exercising, reading, and deepening my personal relationships. (Not to mention watching the Mets in the World Series.)

I want to be a good and whole and useful person. While I feel I am generally on the right road, I have a tendency to be a people pleaser. I have not yet found a healthy ease with setting boundaries with the result that I am often over-committed.
For example, I’ve recently accepted board seats for a nonprofit theatre and a small public company. I unquestionably have qualities to offer to both and want to be as helpful as I can, yet I find myself quite anxious with over-busyness and full of an unease and dread that I’ve bitten off more than I can chew.

Warren_Buffett_KU-crop,flipMaster entrepreneur Henry Ford related that when he had a problem in his factories he would find the busiest man around and set him to solving the problem. There is some wisdom to this, in that very busy people are busy because they are good at what they do and are innately competent and efficient. So, as you get more competent in life, you get asked to do more.

I certainly admire my colleagues who have a clear-eyed capacity to say an unhesitant “no.” Note Warren Buffet, who says, “We need to say the slow ‘yes’ and the quick ‘no.'”

In his book Good Business, Mihaly Csikszentmihalyi recounts being rejected by his academic colleague and good friend Peter Drucker at Claremont Graduate School in California. Csikszentmihalyi sent a note to Drucker requesting an interview, to which Drucker dryly replied, “I keep a large wastebasket in my office just for requests like this.”

Those business folk who have mastered the prompt, salubrious clarity of the definitive no certainly have a step up on me. I long for an adamantine certainty in knowing my limits. A healthy and engaged business life demands a consistent sense of boundaries. For myself, I’m afraid the people pleaser too often wins out. While I want to be everywhere, learn everything, and collaborate with everybody, I cannot. The ability to say an appropriate and graceful (and sometimes blunt) no is a tangible business value.

So I can’t do it all. At least not well. In a large sense, there is a graceful vitality and even love in mastering the appropriate business no. Over commitment can almost be an act of violence against the self. You need to say no to the penultimate in order to do well that which is ultimate.

TMertonStudyCatholic mystic Thomas Merton puts it this way. “The rush and pressure of modern life are a form, perhaps the most common form, of its innate violence. To allow oneself to surrender to too many demands, to commit oneself to too many projects, to want to help everyone in everything is to succumb to violence. More than that, it is cooperation in violence. The frenzy of the activist destroys his inner capacity for peace. It destroys the fruitfulness of his own work, because it kills the root of inner wisdom which makes work fruitful.”

I certainly can’t state the conundrum better that Thomas Merton.

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A couple of months ago I was one of several company founders asked to write an article on whether entrepreneurship can be taught.  Here’s a sliver of what I said.

“Entrepreneurship emphatically cannot be taught.  In fact, I believe it is somewhat of a racket that so many business schools now claim to teach entrepreneurship.  They can’t.  Entrepreneurship can’t be taught because it is simply messy.  It is unpredictable.  It requires a lived life and a broad personal experience to deal with the wide-ranging unexpected, unprecedented, and unquantifiable problems that crop up each day.  It requires courage, intuition, and integrity.  It demands an understanding of people that can only come from real-world lived wisdom.  It demands you know who you are.”  (The NY Enterprise Report, Sept. 5, 2012, p. 16)

In other words, entrepreneurship is at heart an intuitive and instinctive event.

Now comes a useful book called Heart, Smarts, Guts, and Luck by Tony Tjan, Dick Harrington, and Tsun-yan Hseih that buttresses quantifiably my highly unscientific and intuitive instincts.  This book has a lot to say about what really makes for successful entrepreneurs.

To oversimplify, Tjan, Harrington and Hseih find that self-awareness is the key to successful entrepreneurship—and that book learning and business education is its least salient quality.

Over three years, 500 successful entrepreneurs and global business leaders were interviewed.  The authors break down the human attributes of successful entrepreneurs into four categories.  They are the following and are the source of the author’s book title.

  1. Heart.  This is a person of passion and faith.  He or she comes up with a great idea and simply believes that right things will happen if they follow that vision.  Think Howard  Schultz, John Mackey.
  2. Smarts.  This is a person who recognizes patterns faster than anyone else.  Think Warren Buffet, Meg Whitman, Jeff Bezos.
  3. Guts.  This is a person of dominance, who has the simple guts to persevere and endure no matter what.  Think Richard Branson or Nelson Mandela.
  4. Luck.  While most entrepreneurs benefit from luck at one time or another, lucky people particularly possess optimism, intellectual curiosity, and humility.  Think Laurel Touby.

The authors have developed a methodology, not dissimilar to the Myers-Briggs test, that allows you to analyze and increase your entrepreneurial self-awareness.  It’s called E.A.T., which stands for Entrepreneurial Aptitude Test.  (My own test showed my qualities to be strong in Heart with a touch of Luck.)

The authors further identify three fundamental business archetypes based around these aptitudes:  The Founder, the Scaler, and the Extender.  Most of us have to be a combination of these over time.  Founders are Heart dominant with a little Guts or Luck.  They are critical to initiating a company where vision, team building, and cultural definition matter most.  Scalers mostly embody the Smarts-Guts profile and are focused on growth.  He or she has to preserve the founding culture, while adjusting for purposes of scale.  Extenders have strong Heart with Smart ability to recognize patterns.  They explore and expand into new areas and markets.

The over-all conclusions of these authors are that intense self-awareness is probably the key quality of the successful entrepreneur.  She knows who she is.

By analyzing your key qualities through self-reflection and a tool like E.A.T., you can more easily grow into areas you are lacking or hire someone to compensate for your insufficiencies.  You can develop many of these qualities over time, but these qualities are certainly not conducive to academic pedagogy, according to Tjan, Harrington, and Hsieh.  Tony Tjan’s research finds that over 70% of successful entrepreneurs do not start with a formal business plan.  Tjan says, “Having … self-awareness may be the best marker of a successful entrepreneur—even more critical than having a high I.Q.”

As Dolly Parton sagely advises,  “Find out who you are and do it on purpose.”  Thanks, Dolly.

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Here I go peering into the abyss again.  Still I say, “Be afraid.  Be very afraid, small businessman.”

The latest business warning comes from Steve Wynn, Chairman and CEO of Wynn Resorts, who unleashed a blistering jeremiad last Tuesday on an investor conference call published by Business Insider, directed at the business climate in the U.S. and, very specifically, at the constant stream of new regulations and the anti-business rhetoric of the current federal government.

What he said was most surprising in that Steve Wynn is a big contributor to the Democratic Party and heavily bankrolled Sen. Harry Reid’s reelection in Nevada last year.  He said, “I’m saying it bluntly, that this administration is the greatest wet blanket to business and progress and job creation in my lifetime.”

He says all business at all levels should fear President Obama and his bureaucrats.  Wynn feels the U.S. is becoming dangerously statist, oligarchic and authoritarian, even as China successfully embraces free enterprise and capitalism.

Though there is a huge amount of capital waiting to invest, including his own, he basically feels you’re nuts to invest in the U.S. in the increasingly suffocating bureaucratic environment.

“Until we change the tempo and the conversation from Washington, it’s not going to change.  And those of us who have business opportunities and the capital to do it are going to sit in fear of the President.  And a lot of people don’t want to say that.  They’ll say God, don’t be attacking Obama.  Well, this is Obama’s deal and it’s Obama that’s responsible for this fear in America.”

Warren Buffet (another large Democratic donor) and Bernard Marcus of Home Depot also spoke with increasing alarm about our business climate last week, and, unsurprisingly, Nouriel Roubini is quoted in Forbes Magazine as saying we have already entered a new recession.

Now, the interests of big business big shots like Wynn, Buffet, and Marcus are not always congruent with your or my interests.  However, in this case they are.  Marcus said flat out he could never have started Home Depot with all the bureaucratic  barricades set up in the last three years.  These new and multiplying regulations create a stultifying trope for small businessmen.  And we have yet to see what time-wasting paperwork awaits us in Obamacare (145 new bureaucratic entities and counting) and Dodd-Frank.  All this new regulation is well-meaning but the results are a killer for the entrepreneur.

I wouldn’t be an entrepreneur if my core wasn’t that of an optimist, but reality is daunting these days.  As Jon Huntsman, former Governor of Utah puts it, “We have lost that which has made us great over the generations, and that is the sense…that we can come up, that we can pursue our dreams and our aspirations and that we won’t be blocked by government [from making] our dreams come true.”

Thanks, Jon.

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