Sit on going forward until it makes sense
When Warren Buffett talks about the discipline of sitting on something and not going forward until it makes sense, he hits on one of the most lacking skills, disiplines and tools that can be used for some of the greatest competitive advantage.
We talked about his ability to adapt and adjust lately in response to there being nothing in the number one position of availability that the company looked for. But in that adaptation, it wasn't just for the purpose of doing anything so it looked like he was moving, rather it was a legitimate foray into an area that they had some expertise in: currencies.
Even when the move looked like it backfired for a time, he has stuck to his guns and is being paid off with success as usual.
Concerning the best use of Berkshire Hathaway (BRK-A) money these days, Buffett says "My hope was to make several multi-billion dollar acquisitions that would add new and significant streams of earnings to the many we already have."
When he couldn't find it one year he said, "But I struck out. Additionally, I found very few attractive securities to buy. Berkshire therefore ended the year with $43 billion in cash equivalents."
If something isn't there within the parameters of the purpose of the company or the sphere of expertise they operate in, they will do nothing but sit on the money until that opportunity comes around.
It's my conviction that if there were a lot more companies that were run this way, the economies around the world would be much more predictable and profitable. We need managers that can keep this type of discipline in the midst of the constant pressures to do something for the sake of action being taken.
Other Buffett Resources:
MSU students have special visit with billionaire Warren Buffett
Sticking to what you know Core businesses
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