Devoted to Managers and those that seek to improve their management skills

Warren Buffett and Secrets of Management - 24

We've been talking about what it is that Warren Buffett of Berkshire Hathaway (BRK-A) finds important as a manager, and in his managers.

Within those parameters, Buffett has an extraordiarily easy way of weeding out potential candidates. He says concerning managers Berkshire will hire or promote, that they will be “working with only people whom we like and admire.”

This whole series on Warren Buffett and management deals with all of the details of that statement, but think of it as a early warning or filtering system on the front end of the process. If those two parts of the general equation aren't there from the beginning, then they don't even bother looking at anything else. That's connected to the hiring side of things and determining whether to bring the process forward.

Now from the daily operations part of it, think of how this releases Buffett and his other main people in the company from having to look at things on the micro level.

What it does of course is release him and others to do that which adds the most value to the company. For him or others to have to spend a lot of time on daily issues would be a vast waste of time. The result is that those in key positions can give themselves to the company in complete confidence knowing that they won't be too surprised by anything that may happen.

That's one of the strengths that Berkshire has; a flat reporting structure where there is direct communication at the top when it's really needed. This is part of the original statement that they work with managers they admire. Part of that process is candor, as we've talked about before, and the encouragement to report bad news right away.

Part of the enormous success on the management side of Berkshire has been this philosophy that permeates the company and has been practiced for decades. Buffett has commented that some of the CEOs in the companies literally haven't contacted him in years; and he likes it that way.

Other Buffett Resources:

“Everybody Else is Doing it”

MSU students have special visit with billionaire Warren Buffett

WARREN BUFFETT PHILOSOPHY II

Sticking to what you know - Core businesses

Buffett: Portrait of an Artist as a Young Man