Warren Buffett and Secrets of Management - 56
As a manager and leader of Berkskire Hathaway (BRK-A), what is it that Buffett does on the operational side as far as the various businesses go? We know his key role is to invest the float of the companies, but that's different than an operational role.
What's interesting is that when Buffett goes over the companies, he does it only once a year and checks out three major areas of the businesses.
The three things he checks? He checks to see if there are any changes in operating margins, debt levels and in capital expenditure needs.
When we talk about changes, we're talking about something significant, not something miniscule. But, depending upon the company, something small could be in the millions, so it has to be taken from company to company.
This does give an important insight into managing your own department of business. Look at these three things and measure them and you'll have a good overall handle on the business and your responsibilities within it. If something is changing too much, it should be considered a warning sign that needs to be addressed quickly.
One key thing here is that Buffett understands how to measure in a way that relieves him from having to micromanage, which he refuses to do. Understanding what to measure is one of the secrets to letting your people go.
The big picture will tell you what's happening on the micro level without having to try to control it.
Other Buffett Resources:
MSU students have special visit with billionaire Warren Buffett
Sticking to what you know Core businesses
Remember to Sign up for my feed, bizzbite and digg this!
Sponsored link: The outsourcing every manager requires - Tampa Locksmith
Comment Preview