Dan Heard @danheard1 - Twitter Profile

8 months ago

Warren Buffett on the Benjamin Franklin thought exercise anyone can use to be successful Warren Buffett offers the following advice to the students at the Terry College of Business: “Pretend I’ve made you a great offer: You can pick any one of your classmates and you get 10% of their earnings for the rest of their lives. What goes through your mind in determining who you would pick?” He continues: “You probably wouldn’t pick the person who gets the highest grades in the class. There’s nothing wrong with getting the highest grades, but that’s not going to be the quality that sets apart a big winner from the rest of the pack… I think you’ll find that it gets down to a bunch of qualities that, interestingly enough, are self-made… It’s integrity, it’s honesty, it’s generosity, it’s being willing to do more than your share.” Then he asks the class to pick a classmate to sell short: “Who do you think is going to do the worst in the class? It isn’t the person with the lowest grades, or anything of the sort. It’s the person who just doesn’t shape up in the character department.” When Berkshire Hathaway hires people, they look for three things: 1. Intelligence 2. Initiative or Energy 3. Integrity Buffett explains: “If they don’t have the latter, the first two will kill you. If you’re going to hire somebody without integrity, you want them lazy and dumb. You don’t want them smart and energetic.” Importantly, he points out that these are habit patterns: “The person who always claims credit for things they didn’t do, cuts corners, and who you can’t count on — in the end, those are habit patterns. And the time to form the right habits is when you’re your age… Someone once said that the chains of habit are too light to be felt until they’re too heavy to be broken. And I see that all the time.” Buffett concludes: “When you write down the habits of that person you’d like to buy 10% of, look at that list and ask yourself, ‘Is there anything on that list that I couldn’t do?’ And the answer is that there won’t be. And when you look at the person you sell short and you look at the qualities you don’t like — if you see any of those in yourself (egotism, selfishness), you can get rid of that. That is not ordained.” This is an exercise that Benjamin Franklin did, as well as Warren Buffett’s old boss: “Ben Graham looked around and said, ‘Who do I admire?’ He wanted to be admired himself, and he asked why he admired these other people. Then he said, ‘If I admire them for these reasons, maybe other people will admire me if I behave in a similar manner.’ And he decided what kind of a person he wanted to be.” Video source: @universityofga (2001)