Lessons from the Oracle

Warren Buffet's annual letter to Berkshire Hathaway shareholders (see inside the annual report) contains a wealth of wisdom for anyone trying to lead and grow a business (and, remember, schools are businesses, too).  I am usually among the first to caution against autobiographies as sources of leadership savvy--the lessons to be learned are too idiosyncratic to the individual--and Buffet's case presents a special challenge: history is written by the victors, and he is, by all measures, a victor. This means that there may be fallacy in attempting to apply backward logic; e.g., he is successful, so asking him what leads to success will be useful to the rest of us. Buffet, to be sure, is a special case whose success is in no small part correlated with the general success of the U.S. economy over the same time period.Nonetheless, John Gapper, writing in the Financial Times, extracts three precepts from Buffet's letter (and the accompanying piece by Charlie Munger, Buffet's longtime business partner):

• Be patient--Buffet waits an extraordinarily long time for payoffs;
• Be private--keep control of your destiny by avoiding the spotlight that goes with being a public company; and
• Be peculiar--almost everything Buffet has tried runs counter to the conventional business wisdom of the day.

The above cautions aside, there is much that is timeless about this wisdom. Read his letter and take notes.