Who could not be inspired by Warren Buffett, who has promised 99% of his wealth to charity? That wealth is worth about $40 bn. He started selling newspapers at the age of 11 and he is now 84 with no intention of retiring.
“I would say that life at 84, I am having as much fun as I’ve ever had in my life. I mean I get to do what I love every day with the people I love—and it just doesn’t get any better than that.” – Warren Buffett.
He has written extensively about his business success and is in great demand as a speaker on leadership. Here are 10 lessons that he has taught us.
1. Love what you do.
“There comes the time when you ought to start doing what you want. Take a job that you love. You will jump out of bed in the morning. I think you are out of your mind if you keep taking jobs that you don’t like because you think it will look good on your resume. Isn’t that a little like saving up sex for your old age?” – Warren Buffett
Listen to any interview with Warren Buffett and you will hear how passionate he is about his job. He is convinced that this will give anyone in business a competitive edge. If you are thinking of taking a new job which you are not enthusiastic about, it might be worth thinking again.
2. Learn how to communicate effectively.
“You’ve got to be able to communicate in life and it’s enormously important. Schools, to some extent, under emphasize that. If you can’t communicate and talk to other people and get across your ideas, you’re giving up your potential.” – Warren Buffett
Read any letter to shareholders in Warren’s company, Berkshire Hathaway Inc. You will be immediately struck by the non technical language, the clarity of thought and how he gets his message across, with the minimum of jargon. His success is also due to his intimate knowledge of the business.
Warren Buffett was terrified of public speaking and had to enroll in a course to overcome his fear. Aim for easy and clear communication in your own business whether it is a memo to your staff or speaking in public.
3. Choose your business associates wisely.
“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.” – Warren Buffett
He was able to spot successful and talented people and used a few basic networking skills to keep up contact and be inspired by their success. If you hang out with mediocre associates, they will never inspire you to do better and aim higher.
Read about Guy Spier who was prepared to pay $650,000 for a lunch with Warren Buffet because he wanted to be inspired by an extraordinary entrepreneur. The money went to charity, of course. Yes, there is no such thing as a free lunch!
4. Don’t micro manage.
“Hire well, manage little.” – Warren Buffet
He strongly believes that great leaders need to spot and hire great talent. He also lets them get on with it and rarely interferes so that they feel empowered by this independence. The lessons for future leaders are clear. Have fewer meetings and call your CEOs and managers less often.
5. Plan for the future.
“The primary job of a board of directors is to see that the right people are running the business and to be sure that the next generation of leaders is identified and ready to take over tomorrow.” – Warren Buffet
Buffett already knows that his job will be divided into three, once he decides to step down. The board has already chosen a CEO candidate and a non-executive chairman plus an investment manager.
Future leaders need to think ahead about their successors and how they will be groomed for success. It is no surprise to learn that the most successful companies have predictive models in place for their promising talent for the next five years at least. They also place heavy emphasis on education and skills development for their staff.
6. Transparency is highly appreciated.
“If anything, taxes for the lower and middle class and maybe even the upper middle class should even probably be cut further. But I think that people at the high end—people like myself—should be paying a lot more in taxes. We have it better than we’ve ever had it.” – Warren Buffett
Bill Gates admires Buffett for many reasons. Even on such a sensitive issue as taxation, Gates admires him because his transparency is invaluable even though it might not be in his own best interests.
Transparency at every level pays off handsomely in every business field. Employees are tired of surprises and there is a growing demand for delivering the truth.
7. Patience is a virtue.
“No matter how great the talents or efforts, some things just take time. You can’t produce a baby in one month by getting nine women pregnant.” – Warren Buffett
There is no doubt that Buffett has demonstrated patience throughout his career. This great quality goes hand in hand with a certain bravery and perseverance. Great leaders need to resist pressure and have the tenacity to see the project through to the end.
8. Manage your time wisely.
“You’ve gotta keep control of your time and you can’t unless you say no. You can’t let people set your agenda in life.” – Warren Buffett
When Guy Spier had lunch with Buffett, he was shown his diary. It was remarkably empty. The billionaire explained that he preferred to have time for serendipity. It also gives him the freedom to spend the time in ways that he sees as priorities. It also means that he has learned how to say ‘no’ when necessary. The lack of appointments for meetings was noticeable!
Learning to organize their office space, their emails and how much time they spend online are usually great ways leaders can manage their time more effectively.
9. Be prepared to take risks and learn from mistakes.
“Risk comes from not knowing what you are doing.” – Warren Buffett
Buffett has followed basic principles when looking at the risk factor. He prefers to avoid any investment opportunities that carry a catastrophe risk. He always tried to invest in high probability and low risk scenarios.
He has learned too from his mistakes. He made costly errors with U.S. Airways, ConocoPhillips (COP) and Energy Future Holdings. Like any successful leader, he has analyzed his mistakes and used this to make better decisions in the future. Unsuccessful leaders avoid failure at all costs.
“I make plenty of mistakes and I’ll make plenty more mistakes, too. That’s part of the game. You’ve just got to make sure that the right things overcome the wrong ones.” – Warren Buffett
10. Treat everyone equally.
“Personally, I really hope I can treat everyone equally. I think I have done a pretty good job so far but I know I can do it better.” – Warren Buffett
Nobody is left behind. Treating everybody equally and avoiding favoritism is the true mark of a leader. Buffett’s golden rule is about reaching out to the silent, competent workers.
Let us know in the comments which quote/s have inspired you most.
Featured photo credit: Fortune The Most Powerful Women 2013/Fortune Live Media via flickr.com