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Sunday, January 18, 2009

Buffett’s Equation

A writer was commenting on how Warren Buffett was a principled man, and that his values translated in business success. What struck me was Buffett’s adaptation of Einstein’s equation for the theory of relativity. e = mc² (squared).

For Buffett, the success of a business can be predicted from this equation, with changes to what the variables stand for:

E
= earnings, the lifeblood of a business.

M
= management capability.

C
= character of the management. Squared.
The emphasis was on “C squared”.

N
o matter how skilled the management of a company is, the character of the business leaders is even more important for long-term success.

Source: Internet


buffett's comment - There is never a single cockroach in the kitchen.

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