Lawrence A. Cunningham, author of the best-seller, The Essays of Warren Buffett: Lessons for Corporate America, and an upcoming book, Berkshire Beyond Buffett: The Enduring Value of Values
My friend Peter Bevelin recently reached out to me asking about the symposium I hosted for Warren Buffett and Charlie Munger 20 years ago. Peter reminded me of some of the great quotes those two shared with a gathering of hundreds of students and colleagues.
Along with The Essays of Warren Buffett, which was the showcase of the symposium, I published an edited transcript of the proceedings, spanning some 60 pages. Here are a few of the more memorable highlights of what Warren and Charlie said off the cuff during the conversations.
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First Warren Buffett:
“The nature of acquisitions is that they get to the board at a point where if you turn them down you are rejecting the chief executive, you are embarrassing him in front of his troops, you’re doing all kinds of things. So, it just doesn’t happen.”
“I have seen board after board approve deals that afterwards the board members say, ‘you know, I really didn’t think it was a very good idea but what could we do about it?’”
“I would say that more dumb acquisitions are made in the name of strategic plans than any other.”
“I would be very wary if a board went through some elaborate process where a strategic plan was reviewed in great detail and then they endorse it and then the management went on to make acquisitions and then they came and said, ‘But we made it in accord with a strategic plan.’”
Now Charlie Munger:
“I would argue that what Berkshire has done has mostly been using trivial knowledge…if you absorb the important basic knowledge...and you absorb all the big basic points across a broad range of disciplines, one day you’ll walk down the street and you’ll find that you’re one of the very most competent members of your generation, and that many people who were quicker mentally and worked harder are in your dust.”
“Isn’t reality multidisciplinary, so that you have to use the tools of all the disciplines to solve the complex problems?”
Incidentally, note that this event took place just about 20 years ago—and we are in the process of preparing a special edition commemorating both the 20th anniversary of The Essays and the 50th anniversary of Berkshire under Buffett.
Lawrence A. Cunningham