Learning from General Buffett: How not to micromanage your subordinates

I did this last year, but we can learn about military affairs from Warren Buffett every year. The military is not a business, and should not be run like one. But still, the defense establishment could learn a lot from a person as wise as Buffett.

If I could, I would ban all those business fad management books I see senior officers reading and instead make them study the annual reports from Buffett’s company, Berkshire Hathaway Inc. You may not know Berkshire Hathaway, but if you buy insurance from Geico, drink Coca-Cola, eat See’s Candies, read the Buffalo News, use goods transported by the Burlington Northern Santa Fe Railroad, or wear Fruit of the Loom underwear, then products and services of companies owned in part or whole by Berkshire are touching your life.

For example, the U.S. military, and especially the Army, have been plagued by micromanagement since the mid-1950s, so long that no one now in the Army has much experience in any other way to run it. I see generals constantly scurrying endlessly to meetings where they often sit in the dark while subordinates read aloud to them bedtime stories (AKA Powerpoint briefings). Well, there is another way, and it is laid out by Buffett in his annual report for 2010:

At Berkshire, managers can focus on running their businesses: They are not subjected to meetings at headquarters nor financing worries nor Wall Street harassment. They simply get a letter from me every two years…and call me when they wish. And their wishes do differ: There are managers to whom I have not talked in the last year, while there is one with whom I talk almost daily. Our trust is in people rather than process. A "hire well, manage little" code suits both them and me.

Berkshire’s CEOs come in many forms. Some have MBAs; others never finished college. Some use budgets and are by-the-book types; others operate by the seat of their pants. Our team resembles a baseball squad composed of all-stars having vastly different batting styles. Changes in our line-up are seldom required.

(p. 7)

Imagine a military run like that, that trusted people rather than process, a military where the Army chief of staff could boast that XVIII Airborne Corps is run so well that he has kept the commanding general in place for several years, and hasn’t seen him in two years or even talked to him in one. But, the chief of staff would continue, he does talk to the Army commanders in Iraq and Afghanistan daily, in part because they need his help, and in part because he isn’t distracted by checking on the XVIII Airborne Corps. My view: People who spend most of their days in regularly scheduled meetings too much probably are wasting their time and others’.

Also, because Buffett keeps successful people in place, staffs and subordinate managers are not constantly in turmoil and adjusting. Instead of constantly adapting to new bossses, they can focus on the tasks at hand. And the boss can leave them alone because he knows how to tell when they need help and when they don’t.