As an avid reader, an addicted audio book listener and a small business owner I have read countless business biographies. Richard Branson, John D. Rockefeller, Ted Turner, Warren Buffett, Steve Jobs and John Mackey highlight the list. I have also read several political biographies. These include Harry Truman, Abraham Lincoln, Winston Churchill and the last three American Presidents. The effectiveness of these leaders can be debated, but they were all leaders. I have tried to find parallels between these historical figures to enhance my own abilities, but there are not many consistencies. Some of these men were tactical and some bold. Some were taciturn and others charismatic. Some were geniuses and others not at all. Some were ostentatious and others frugal. As it seems more appropriate, here are some of my insights about the business leaders.
Richard Branson never graduated from high school, but instead started Student Magazine to protest the Vietnam War quickly followed by a mail order record business which led to Virgin Records. Branson never followed the rules. While running Virgin Records he convinced his board to let Virgin venture into the Airline business – and it worked. This would contradict the wisdom of almost any business executive or business school academic, but he trusted his instincts.
John D. Rockefeller also dropped out of high school. His success in the oil business came from achieving monopoly status by beating his competitors on price through economies of scale. His vast wealth stemmed from retaining and expanding his shares in Standard Oil. He bought up competing refineries left and right offering either cash or stock to the owners. He consistently advised them to take the stock and never let it go. Although he was neither charismatic nor a genius (by academic standards), he stuck to his plan and fervently believed in the company he created.
Ted Turner might have been the one business executive of whom I am aware to possess genius level intelligence and elite charisma. He made it through high school, but dropped out of college at Brown. After his father passed, Turner was only in his early 20’s. He negotiated, pleaded and even threated the acquirer of his father’s billboard business and eventually got it back. Fearlessly, he expanded, got into radio then cable TV, bought the Braves and started the first 24 hour new station, CNN. When he bought the Braves they were losing about $1 Million per year. He paid $10 Million and almost immediately guaranteed that they would win the World Series in five years. I am doubtful that he had a plan to bounce from outdoor advertising to radio to cable television and along the way own two professional sports teams. But, there is no doubt that he recognized opportunity and was a visionary of sorts in several business.
Warren Buffett took a more conventional path. He graduated from high school with good grades and an entrepreneurial spirit. He went To UPenn, but transferred to Nebraska likely due to home sickness. He graduated from Nebraska and even went to graduate school at Columbia to learn under his idol, Ben Graham, the “father of value investing”. He was a stock broker, but quickly realized that he preferred to create partnerships for his investors. With huge returns early on he quickly became a rich man. Part of his knack for big returns lied in his bold strategies. If he believed in something he would invest heavily. Early on he bought a huge stake in Geico which gave him “float” and the ability to buy up more stocks. Singlehandedly, over 50 years, he served as the one clear example of the ability to beat the market. When the Efficient Market Hypothesis popularized among academics, he was the one inexplicable phenomenon. It is hard to say his secret, but investing heavily and spending very little along the way is a good formula.
Steve Jobs was perhaps the least conventional. He dropped out of college and created the first Apple Computers out of a garage with his friend Steve Wozniak. Jobs did not even know how to write code for computers, but guided “Woz” as the first Apple computer was created. This is hard for some computer experts to fathom, but Jobs who helped found the company and then turn it into the Apple that we know today, could not even create a computer. Gates jabbed at Jobs for this lacking this skillset so important the computer brethren of the 1980’s. Despite lacking the technical expertise, Jobs always ran the show often verbally attacking the designers until he liked what he saw. According to some testimonies, he was wildly inconsistent – one day claiming that something was terrible and the next not only proclaiming it great but taking credit for it. He was incredibly unpredictable and admittedly “mercurial”, but his focus was always the product. When asked why he chose not to use market research he replied that Alexander Graham Bell did not use market research when he invented to telephone. He was a visionary. He singlehandedly turned Apple into one of the most profitable companies in the world and made Pixar into a powerhouse, launched two of the greatest advertisement campaigns in history, and revolutionized the phone, tablet and music industries. He just seemed to know what people would want. A good example of his uniqueness is that he opted not to bathe for long periods as he swore that his vegetarian diet made showering superfluous. Jobs broke every mold for a CEO. He didn’t go to a fancy school, did not even truly understand the intricacies of his products, was extremely difficult to work for, and refused to adhere to societal norms. It is far easier to be confident when you possess all of the abilities consistent with the expectations for someone in your position, but far more difficult to lack all of those qualities. Simply put, Jobs’ confidence is unsurpassed in my opinion.
John Mackey built Whole Foods from the ground up. His style is more modern and outlook lends credence to both his company and capitalism in general. Mackey believes that companies successful in the modern age need to exemplify a “conscious” culture. He does not believe in gouging suppliers, beating up competitors or only meeting the minimum standards for ethics as required by law. He proclaims that modern companies must have a clear culture that emphasizes what he calls “Winning to the Sixth Power”. This means running a business so that you bolster company profits as well as suppliers, employees, the environment, the industry etc. Quite the contrarian, he believes in empowering employees through autonomy and rarely ever firing them, allowing good suppliers fair profit margins, listening to his critics and trying to rationalize their viewpoints, exceeding environmental and animal welfare standards. He even goes out of his way to compliment his competitors (i.e. Trader Joe’s) when he believes they are meeting these standards.
Judging from these business leaders, there are a lot of different ways to effectively manage a company. Branson was bold and charismatic. Rockefeller was obsessive and borderline tyrannical. Turner was brilliant and energetic, Buffett was purposeful and consistent, Jobs was obsessed with the product itself and Mackey emphatic about the culture. The only parallels I can ascertain are hard work and confidence. I know it would be far more helpful if it certain characteristics led to success in business, but like many things, it’s not that simple.
References
Chernow, R. (2007). Titan: the life of John D. Rockefeller, Sr. New York: Knopf Double Day Publishing Group.
Turner, T. (2009). Call Me Ted. New York: Hachette Audio.
Schroeder, A. (2008). The Snowball. Warren Buffett and the Business of Life. New York: Random House.
Issacson, W. (2011). Steve Jobs. New York: Simon and Schuster.
Sisodia, R., George, B., Mackey, J. (2014). Conscious Capitalism: liberating the heroic spirit of business. Boston: Harvard Business Review Press.