Posts Tagged ‘People’

What Is Leadership?


This morning I wrote a comment on my Twitter and Facebook (as I normally do so many times a week when I have a thought I deem worth sharing):

“If you’re not listening and attending to each and every voice, your leadership is compromised”.

I should have been more specific as I was soon bombarded by dozens of comments begging me to defend my statement. (I paraphrase).

“One who looks to attend to all attends to none. A leader is defined by how they lead – not how they react”

“The leader not only has to listen, but must also consider external and internal factors that are not being voiced!”

“The leader, not the people, will often make the right choice. A leader leads by example”

Various Other Leaders vs The Ultimate Leader

There are various types of leaders, as my friend Yermi points out in in “Leadership – The Good, The Bad and The Ugly“. And in addition to adjustment of character, there are various functions in the organization that each require leadership: The Financial Leader, The Management Leader, The Marketing Leader, etc.

The individual I refer to however is none other than the Enterprise Leader. This is the Big Kahuna, The Head Honcho, The CEO – whatever. He or she is the person who takes full responsibility for the organization, company, or nation they lead.

Peter Drucker once said “Leadership is lifting a person’s vision to higher sights, the raising of a person’s performance to a higher standard, the building of a personality beyond its normal limitations”

The Job vs Enterprise Leadership

Leadership is more than just a job, or “function”. It does not follow the same job description as “COO” or “VP of Sales”. The leader is one who a) takes full responsibility for the organization and b) drives it and its people forward to greatness and improvement.

Many people confuse CEO (chief executive officer – or enterprise leader) with COO (chief operations officer – or management leader). The COO’s job is to make sure everyone does their job. To ensure that operations run smoothly and effectively. To create systems and procedural duties that allow the organization to endure as it did yesterday.

The Enterprise Leader has a different focus entirely. The Vision. Whereas most others in the organization focus on yesterday, today or tomorrow, the Leader must focus on all of these simultaneously. Whereas a hierarchy of lead and be led is often present, the ultimate decision maker must actually fill both roles.

The Leader and The Vision Are One

The Vision is the leader’s leader; the white paper, the commitment and the dream, self-imposed or otherwise, that the organization and the leader must follow. It is the “bible” which all answer to and none refute. It is the essential constitution that reinforces the core competency and compels the audacious dream forward. The choices made are only a means to achieve the result required.

There is little room for personal thoughts or discrepancies as to what the organization should or should not do. If the dream is realized, the organization and the leader are a success. If not, then all the billions in the world cannot validate its worthless existence.

The Problem Today

In the early part of the last century, businesses and organizations struggled. Either they battled to gain dominance in a small but meaningful niche, or they assumed greatness quickly but just as soon realized they could not carry their own weight.

So we became obsessed with results and productivity. Organizations became organized. The assembly line became the norm. And Six Sigma became an ingrained part of every management system.

But Where Are The People?

And herein lies the essential and impudent task of the enterprise leader. We’ve forgotten all about the people who MAKE the results, and who ARE effective. We’ve put so much focus on the work and the assembly line and the success of our machines that we have completely disregarded the hard working men and women who make it all possible.

Tony Hsieh, CEO of, says that the leader should be properly dubbed “The Chief Happiness Officer” (Check out the book). That is his or her true function. In addition to making sure that all the other leaders are doing their jobs helping people do their jobs, they must be an example of what it means to be a good person. Someone who cares about the process just as much as they care for results. Someone who is just as into the People Strategy as they are into their Product Strategy.

Are your people happy? Do they have what they need – attention, love, appreciation, worthiness, value? Do they follow you because of your love and dedication to them and the company? Or do they obey you because they fear heads will roll if they don’t?

What happened to morning psyche-ups with your sales teams? Whatever happened to the CEO walking through the production floors on a periodic basis? What in the world happened to the leader that cares more for his own people than the market cap of his whole company?

Forget all about what textbook leaders look like and act like, and open your eyes to reality. People need people, and YOUR people need YOU.

If you’re not listening and attending to each and every voice, your leadership is compromised.

Quote of the Day

“If you’re smart, you don’t need leverage. If you’re dumb, you have no business using it.”
– guess who?

Yes, and Buffett has a degree in Science too…

” Long ago, Sir Isaac Newton gave us three laws of motion, which were the work of genius. But Sir Isaac’s talents didn’t extend to investing: He lost a bundle in the South Sea bubble, explaining later, “I can calculate the movement of the stars, but not the madness of men.” If he had not been traumatized by this loss, Sir Isaac might well have gone on to discover the Fourth Law of Motion: For investors, as a whole, returns decrease as motion increases.”

CNN Money Poll

Do you believe the recent tightening of credit will affect your personal finances?

Yes 33%
No 60%
Not sure 6%

Duh! Because people are so F’n smart that there is no way a bad market can possibly affect them.

Thoughts to Ponder…

The Blackstone Execs are looking smarter by the day… BX is 16% off its highs… the IPO that is.

It doesn’t surprise me that Warren Buffett bought GEICO amidst the Bear Market, what astonishes me the most is that Buffett bought at all.

How many investors could truly withstand a 60% correction?

After a 19 year Bull Run, we’ve had only two years of declining prices and yet Investors don’t seem to belive we can get it again.


Deciphering a Fool

“In the beginning wise men and fools men look alike. In the beginning all wealthy men and paupers look alike. And all those who believe and don’t believe look alike, in the beginning.”

Every day I begin to understand better that it’s not that Warren Buffett is that so much smarter than everyone else, but rather that many people are far more foolish than they seem.

Yes, they all may look intellectual, and quite wealthy. They say on that Wall Street is the only place where a man who drives a Rolls Royce takes investment advice from the man who took the train.

Everyone seems to know everything until a day comes when they are proven to know nothing at all. They speak of risk management when they allow soft-headed kids straight out of college to run their portfolios. They speak of many opportunities when there are few, of profitable techniques when they are indeed following the herd, and give wise and sagely advise when they go ahead and act in line with the opposite.

How many investors know why they buy? With the CDO market now under fire I would even question how many investors know what they buy? They say any idiot could fly a plane but it takes talent and skill to land smoothly. Investment history has proven no different.

In any issue you must ask yourself “Why am I buying? Is this the best opportunity in the market? What is my margin of safety? What can possibly go wrong? How much is what I am buying worth intrinsically? How long do I intend to hold for? When and under what circumstances will I sell?”

If any of these questions lack answers the ownership of the issue at hand should immediately come into question.

Buy and Hold. Remember that any properly thought through investment will eventually prove profitable, however it will differ as to what time in the future it will occur. This is more an element of discipline than one of value. Once you realize a trade has gone sour it may be about to turn fresh again.

Buy what you know. It sounds so simple but so many so called “investors” disobey it every day in the hope of better than average returns.

Patience. This applies to the purchase of a good holding as much as it is applicable to its hoarding. When you go to a supermarket and you don’t see any bargains you often leave empty handed. Shopping in the Stock Market should be no different.

Buy Low, Sell High. It sounds so simple. But few understand its true meaning. You cannot expect to make an astounding purchase and have the Street cheer you on. On the contrary, their scoff and boo you off stage, even call you “irrational”. But then again maybe you do know something they don’t.

As Warren Buffett said “Fools do in the end what wise men do in the beginning.”

On the Trade Deficit

“Foreigners now earn more on their U.S. investments than we do on our investments abroad. In effect, we’ve used up our bank account and turned to our credit card. And, like everyone who gets in hock, the U.S. will now experience ‘reverse compounding’ as we pay ever-increasing amounts of interest on interest.”
– Warren Buffett

Somebody’s Thinking

Berkshire Hathaway (BRKA) said it has agreed to acquire jewelry manufacturers Bel-Oro International and Aurafin LLC. Financial terms of the deal, which is expected to close during the second or third quarter of 2007, were not disclosed. The two companies will be combined into the newly formed Richline Group and will continue to market under multiple brands. Dennis Ulrich, currently the president of Bel-Oro, will become chief executive of the new group.

I’m not sure why I’m picking on Buffett. I guess I was always wondering why he isn’t taking part in the Precious Metals Bull market… but he is!


Quotes of the Day

Risk comes from not knowing what you’re doing.
–Warren Buffett

The Definition of Risk is a reality which reaches further than a perception.
– my1ambition


Thoughts on Silver

As you know we are more bullish on silver than on gold for a number of reasons, including its historical monetary use, its tendency to outperform gold in secular bull markets as well as an apparent short squeeze in the making.

We’ve mentioned many time over that trying to time an investment is like dart throwing. Not that its impossible but how many people do you know who can get the bulls-eye every time. Nevertheless its always exciting attempting to predict the future.

We mentioned that we expect silver to play out the same way it did in the fast-breaks in both May 2004 and May 2006 (also similar the bull market in the 70s). Each experienced a rapid appreciation, followed by a sharp correction and then a rather long consolidation stage.

The reason this is necessary is because in addition to investors and speculators there are, believe it or not, commercial interests – mines, jewelers, coin dealers, etc. – that base much of their business on the stable price of the metals. When the price rises due to the demands of the market it takes months for these institutions to adjust to the new prices.

We thus expect silver to continue its current consolidation stage until September of this year. During this time we expect many of the equity markets to correct as well in something similar to what we saw last May as a global sell off. This will be succeeded by another parabolic rise in the metal unexperienced in over a generation. We believe that prices may reach to $28 an ounce by May 2008 and possibly higher if demand from Central Banks, China and Russia kick in as well. Once again this is not what’s possible but what’s most probable.

Just a thought to ponder in the meantime:

Berkshire Hathaway has a market cap of about $160B and a cash pile of about $46B. That means that Warren Buffett is now suggesting a cash position of about 28%. Risk-savvy?

Book Review

Security Analysis (Classic 1934 Edition) – Benjamin Graham and David Dodd

I heard that when Warren Buffett worked for Benjamin Graham he decided not to invest another dime until he had read Security Analysis twelve times. There is no doubt that this is the most influential book on investing ever written. It should be on every investors’ bookshelf, even if just to dip into during quiet moments.

I’m currently in the middle. It’s a great read and based on Graham and Dodd’s level of brilliance I would understand why Buffett said twelve times.

Warren Buffet in University of Florida

I just finished watching a clip I found on Google Video. Its a bit long (1 hr. 28 min.) but Warren’s wit and brilliance makes it seem all that much shorter.

Click Here for Video

“Never wager something of value for something of a lesser value, even if the odds are 1/1000 in your favor.

“If you had a gun with a 1000 barrels and someone told you they would pay you any amount of money for you to pull the trigger once would you do it? I wouldn’t”


Quote of the Day

“There was a man over in Omaha who, when hiring, looked for three things: Integrity, Intelligence and Energy. The latter two are nothing without the first two. If you have someone without integrity you want them dumb and lazy”

– Warren Buffett

“Can you take me higher?”

As of this moment the Dow is at an all-time high, intraday included – 11959.63, up 105 points.

Berkshire Hathaway A-shares are selling for $99,999.00

Updated: February 20, 2007
Try a Dow of 12,767 and BRKA selling at $108,500 – Can you take me higher?


Haha! Just in case you all forgot what a “Top” means. (I love the part about Warren Buffet’s “annual homilies”). Here’s what Warren really said (in 1999 don’t forget!) “stocks can’t possibly meet the public’s expectations”.