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

"Good ideas are too scarce to be parsimonious with."

Parsimonious means stingy, frugal or conservative.

When Buffett talks about the mistakes he has made throughout the years, most the time it is on the "parsimonious" side, rather than the other way around.

Buffett has the discipline with Berkshire Hathaway (BRK-A) money to sit on billions over long periods of time until the right thing comes along. When the right thing comes around he usually goes after it agressively, but sometimes he has stopped short or the full value because of the price rising.

He says it like this: "If we start buying a stock, we want to go in heavy. ... We've made some big mistakes starting to buy something that was cheap and within our circle of competence, but trickled off because [the] price went up a bit. Good ideas are too scarce to be parsimonious with."

One of the investments he stopped putting money into too early, he says, cost the shareholders over $8 billion because of being frugal at the wrong time.

We must be, as we talked about last Buffett post, complete masters of the business universe we move in. That's the only way we can know enough to indentify when good ideas come that can move our business to extraordinary levels. These types of good ideas are a scarcity, and when they come, that's the time to move from being frugally disciplined to being agressively disciplined.

If we don't have the discipline to move agressively with good ideas come to our company, we are no longer being disciplined in the frugal sense, but we're simply in a rut that we think keeps us safe, but in reality can destroy any business.

Discipline in business management is knowing when to be frugal and stingy, and when to be agressive and go after something. Identifying when a truly powerful, scarce idea emerges is the key to making the right decisions at the right time.

Other Buffett Resources:

Wisdom of Warren Buffett

Warren Buffett, investor

Warren Buffett: The trouble with being a legend

Warren Buffett: 'I told you so'

Company growth

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