Willing To Clean House When He Had To
There's always a double-edged sword to anything in life and it definitely extends to management.
In reference to results that Buffett expected of the companies managed under Berkshires' (BRK-A) umbrella, his focus was on attaining them through integrity and accountability within the managment. It was a huge demand that he's never backed off from.
Now the other side to high demands is that there will come a time when some in management grossly fail the integrity and accountability test and have to be dealt with.
Those familar with the Salomon Brothers fiasco that Buffett unknowingly inherited, and was all over the media world, saw in action that the standards demanded by Buffett weren't met, he was willing to take responsibility for his standards and deal out the appropriate responsibility of getting rid of those that didn't or wouldn't meet them.
Buffett handled it well as he was quick to point out that the vast majority of the people at Soloman Brothers were fantastic, and that his gripe was with a small minority that had failed greatly in their dealings.
He physically went to the business to take care of the problems that exposed themselves after the fact of his investment in them.
High standards require strong responses when management falls short of essentials like integrity and accountability. Response has to be fast, tough and fair. We must be willing to do what we must to let all in the company know that these are the non-negotiable traits demanded of anybody that wants to work in our companies. Anything else would make us less than we need to be.
Other Buffett Resources:
MSU students have special visit with billionaire Warren Buffett
Sticking to what you know Core businesses
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