Warren knows business. He’s practical, straight-forward, pragmatic and unconventional. His approach works. There are about 50 billion reasons why this is true (his net worth). Although, I acknowledge that money is not the only measure of success, it certainly is compelling.
Buffet is indeed an unconventional guy. He is a contrarian. When the general business community, the trends, the fads and waves are going a certain direction, Warren goes the other direction. When everyone is buying up stocks like crazy, Warren is selling and accumulating cash. When the marketing is crashing and everyone is selling, Warren is buying.
I saw a segment on 60 Minutes the other day about Warren and his succession plan when he dies. (He doesn’t plan to retire). Here is the link if you want to watch the clip. Click here
Warren, if he has his way, wants to appoint his son Howard as the Chairman of Berkshire Hathaway (his primary business). What makes this so unusual and unconventional is that Howard doesn’t work in the business and, by Howard’s own admission, isn’t really qualified for the position. He’s a corn farmer.
Warren’s primary reason for bringing Howard in to succeed him is to preserve the culture of the business. Warren and Howard agree that Howard understands the values of the organization that would ensure that they are preserved over time. Warren is seeming unconcerned about whether the business will continue to succeed when it comes to the day to day operations. I suspect they have a set of standards and systems to ensure consistency and quality in the work they do. That’s not the concern. The concern is preserving the values and culture.
A culture is a delicate thing. Warren knows this and understands that if a culture is cannibalized it could destroy a business.
So how can we learn from one of the richest men in the world?
First, we need to determine the culture and values we want to create in our businesses. If Warren wants to preserve values, then they must be important for the sustainability of the business. (Within the Level 7 System, we engage in this work of determining the culture and values for you organization)
Second, we need to establish a strategy for effectively building, communicating and Threading the Culture through the organization. We have to establish a sustainability plan. (Within the Level 7 System, we engage in several processes including Building Effective Downward Communication and Establishing Your Threading Culture Strategy to ensure your business has a fully ingrained and established set of values and culture).
Bottom line: We shouldn’t discount the value and importance of a solid, sustainable culture if we want to build a quality and prosperous business.