Symposium Redux: Essays and Lessons
The Essays of Warren Buffett: Lessons for Corporate America is as rich as the man, judging by the variety and depth of commentary contributed to this week’s on-line symposium about the new third edition of the 300-page book.
A dozen luminaries from various walks of life and backgrounds, and with very different viewpoints, addressed issues such as target audience; thematic approach; selected content; what is Berkshire?; and even who is Warren Buffett?
Seventeen years after hosting an in-person conference on the subject, I remain awestruck at the varied impressions that can be generated by the same set of material. Herewith, a recap of this week’s contributions, at least as I saw them, leading off with a hearty thanks to all who contributed to the symposium.
Audience. The broadest theme revealed disagreement about the audience for the book. Sy Lorne set the stage, noting the many audiences Warren addresses when writing his chairman’s letters, nominally shareholders of Berkshire Hathaway Inc., but really a broader range of constituencies.
Yet Sy suggested The Essays, if not the letters, were targeted to investors, as he worried that they make investing look too easy; similarly, Jill Fisch seemed to think they were for retail investors when observing critically that Buffett’s lessons cannot readily be adapted by such investors.
Students seemed to be seen as the target audience when Guy Spier characterized The Essays as a textbook while Steven Davidoff said The Essays are for everyone (the “common man”), a point also once made by New York Times columnist Joe Nocera when he recommended that President Obama read The Essays.
I appreciate that people from all these walks of life have been fans of the book and I’m grateful for that. Yet I confess that Kelli Alces struck closest to my sense of the intended audience for The Essays, as her remarks reflected my sub-title: Lessons for Corporate America.
Approach. A slight disagreement appeared in relation to the value of reading Buffett’s letters fully in chronological order versus the selective and thematic rearrangement that distinguishes The Essays. Chris Begg appreciates the “logical architecture” of The Essays while Sy put in a good word for the approach of reading the 700+ pages of raw material in order.
As explained in my Introduction to The Essays (and special thanks to Carol Loomis for her kind words about that), my goal was to identify the core themes and present them in a dynamic sequence, omitting repetition and esoteric data, while revealing both the consistent principles applicable to given topics and how Buffett’s views evolve.
The approach works, in part because, as Carol explained, Buffett has been highly consistent over four decades of writing his letters and, as Bill Bratton’s careful tracing of the history of Berkshire’s dividend policy attests, readers can see quite clearly the precise way in which his thinking has changed. As Chris wrote, The Essays enables readers “to witness the progression of Buffett’s thinking as it evolved over the decades.”
Themes. Don Graham and Bob Mundheim related personal experiences on topics that animate The Essays, respectively, the potentially valuable role of savvy shareholders in advising management and the unusually modest role bankers play in deal-making at Berkshire. How The Essays animate such anecdotes is revealed poignantly in Deborah DeMott’s copiously-annotated review and assessment of Berkshire’s skepticism about agents.
The discussion Deborah quotes from The Essays about Berkshire’s acquisition of the Scott Fetzer Companies in 1985 was essentially identical to the story Bob related of Berkshire’s acquisition of Benjamin Moore & Co. in 2000. The pairing of Bob and Deborah’s pieces nicely links practice and theory.
What’s Berkshire? Jill and Kelli each explored how Berkshire is unusual or unique, sharing my sense that the company cannot be replicated, perhaps because Buffett is sui generis. He may have that distinction either because of his unconventional nature, as Don suggests, or his command of psychology, as Ken Shubin Stein hypothesizes.
But Kelli rightly notes the lessons offered for other corporate constituencies on many topics. She cites disclosure, a point that dovetails with Carol’s observation that Buffett’s work on that topic with the SEC in 1977 sparked his interest in perfecting the art of the corporate chairman’s letter.
Both Jill and Steven wonder what Buffett’s uniqueness entails for Berkshire post-Buffett. They sound notes of caution often heard. As I wrote two months ago at Manual of Ideas and told the Motley Fool at this year’s annual meeting, however, I have a different opinion. In my view, Buffett’s ultimate achievement is having created a great institution that is bigger than himself and will endure beyond him.
Who is Buffett? Steven compared Buffett to Ben Franklin while Guy put him in the class that includes the likes of Milton Friedman, Frederick van Hayek, John Stuart Mill and Adam Smith. Well-defended and intriguing as these possibilities seem, Charlie Munger has already claimed the Franklin mantel (see Poor Charlie’s Almanack) and Buffett has repeatedly said he has no interest in writing a book articulating a philosophy or economic theory as the others did.
That’s why I analogized Buffett, as a writer, to an essayist, composing occasional pieces on topics of the day, and why I entitled the book The Essays. It’s also why I begin The Essays of Warren Buffett with epigraphs from the two greatest essayists in history, Montaigne and Ralph Waldo Emerson:
“The speech I love is a simple, natural speech, the same on paper as in the mouth;
a speech succulent and sinewy, brief and compressed,
not so much dainty and well-combed as vehement and brusque.”
–Michel de Montaigne, The Essays of Montaigne (1580)
“The sincerity and marrow of the man reaches to his sentences.
I know not anywhere a book that seems less written.
Cut these words and they would bleed; they are vascular and alive.”
–Ralph Waldo Emerson, Representative Man (1850)
(referring to Montaigne and his Essays)