A Buffett of Advice
My friend Eric recently sent me an article describing advice Warren Buffett once gave an employee.
In the article, Buffett wanted to help his employee get ahead in his working life, so he suggested that the employee list the twenty-five most important things he wanted to accomplish in the next few years. He then had the employee circle the top five and told him to prioritize this smaller list.
All seemed well until the wise Billionaire asked one more question: “What are you going to do with the other twenty things?”
The employee answered: “Well the top five are my primary focus but the other twenty come in at a close second. They are still important so I’ll work on those intermittently as I see fit as I’m getting through my top five. They are not as urgent but I still plan to give them dedicated effort.”
Buffett surprised him with his response: “No. You’ve got it wrong…Everything you didn’t circle just became your ‘avoid at all cost list.'”
An Important Reminder
I read this story on Scott Dinsmore’s site, where Scott explains he heard it from a friend who heard it from the employee in the story: so some details have likely been mutated during this multi-hop dissemination.
But the story nevertheless resonates because it promotes a truth that I think is vital to remember in our current networked age: spending time on lower priority goals, even though they’re helpful and generate value, can leave you worse off than if you had avoided them all together.
The logic supporting this observation is simple.
- Your highest priority goals return significantly more value per unit time invested than your lower priority goals.
- In addition, your time and attention are limited.
- It follows that effort invested on your lower priority goals steals effort from your higher priority goals.
- If you spend time on the lower priority goals, therefore, your total quantity of value produced is reduced.
The reason I describe this lesson as particularly vital to our current age is that the behaviors that consume more of our time and attention — e.g., social media, web surfing, chronic networking — often fall onto the low priority end of Buffett’s List of Twenty-Five.
These behaviors are sold to us with the promise that they offer some benefit (e.g., “you never know, the contact you make on Facebook might end up bringing you new business”) — but they do so at the cost of stealing time from the harder efforts that are guaranteed to return a lot of benefit (e.g., make your product too good to be ignored).
It’s with this in mind that it’s useful to remember Buffett’s caution: Don’t just prioritize what’s most important, but support this prioritization by avoiding everything that’s not.
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For another take on this idea see Tip #2 in my 2008 article on the Steve Martin Method — the article, interestingly enough, in which I first mentioned his advice to “be so good they can’t ignore you.”
How do you strike a balance between this idea and what you mentioned in your previous post?
“I expose myself to lots of different ideas and I dabble in many of them (a conversation here, a few equations scratched out there, a commute dedicated to noodling an interesting theorem), all the while not worrying too much about capturing every potential concept in some convoluted Evernoted nonsense.”
you still must give some time to seemingly low priority exploration of ideas that might become useful?
I think there’s a big difference between ideas and goals. For example, “publish five papers during this academic year” is a goal. Finding a specific topic on which to write a paper is an idea. I think the synthesis of these two posts is that you should minimize your goals, but expect that a lot of subjectivity and wandering might be involved in executing these small number of goals.
Really great question, Tjerk. That was on my mind too. Thanks for asking.
“…some details have likely been mutated during this multi-hop dissemination.”
Speaking as a professional Buffett-watcher, I’m afraid this is an understatement. Yes, Warren Buffett has said on the record that focus is extremely important. However, I would be shocked if any of the details of this anecdote actually happened as described.
The first sentence alone—”One day a few years back…your goals and dreams” contains several red flags:
1) Buffett is not in the habit of “going up” to people, especially pilots.
2) Buffett would never use the phrase “working for me” to describe “his” pilot, if for no other reason than “his” pilots are employees of NetJets, not Buffett personally.
3) Buffett would never in a million years make the unsolicited statement, “The fact that you’re still working for me tells me I’m not doing my job. You should be going after more of your goals and dreams.” Donald Trump yes, Warren Buffett no.
And it gets less credible from there…
Yes, the story is obviously fake. Buffett brags about retaining good employees and would never want one to leave.
Google that story and you would get the name of the pilot and other details of the story very easily. Mike Flint was Buffett’s personal airplane pilot for 10 years.
Overtime, I’ve learned that reading the same story by multiple authors give a more accurate picture.
This scares me. It might be a good thing.
Whereas the dabblers want to do a lot of things and never get really “so good” at any of those things, the most successful people prioritize.
This reminds me of an interview I saw with James Hetfield of Metallica. He seemed apologetic and very humble about the fact that he couldn’t do anything else but play guitar, sing and write songs.
As he was saying this, I was thinking, “Dude, you don’t have to f***ing do anything else!”
It strikes the same chord as this remark about Steve Jobs:
from https://www.businessinsider.com/jony-ive-vanity-fair-summit-interview-2014-10#ixzz3HcY0XMgk
If your read Peter Drucker, he will say the same thing. Efficiency is about doing things right, effectivity about doing the right things.
In World War II, the Germans did the wrong thing very efficiently. It didn’t contribute much to their reputation. Granted, this example may be extreme, but it should highlight the notion that we need to think about both the how and the what.
The Buffet story, like the Jobs story, shift your focus on answering the question “What to do?”.
As a matter of fact, the act of saying “no” is a real paradigm shift for me. The notorious positive thinker will argue that all you need is a big f*cking “yes” inside and everything will fall into place like magic, and saying “no” is sooooo negative anyhow…
Being a very curious person, I’ve been very susceptible to intellectual diversions of any kind, very much to the detriment of my academic career. While curiosity is a good thing, it’s not a value per se, and unchecked and boundless curiosity will kill your career.
Therefore, the Buffet and Jobs stories seem like very reasonable advice to me. Of course, I learned a long time ago that I need to focus on few things to get ahead. But I was in the “positive thinking” mode of reasoning, which also can be useless at times.
However, the notion of actively saying “no” and having an “avoid at all costs” list are new to me and so appealing that I immediately implemented that. For someone like me, whose curiosity is very easily captured by new things, like coding Android apps or playing around with a Raspberry Pi, it is a very useful thing to put these things on a big no-no list while being busy with something else.
I certainly did do away with the aforementioned things, but it was hard for me. Having a “this will kill your career” list sounds like a very good idea to me.
But then, as Hamming pointed out, everyone must find their own style. While the big no-no list is useful for me because it cures a personality trait of mine that is potentially problematic, it might be the wrong thing for someone who is stuck in a rut and afraid of trying something new.
Hence, I do not subscribe to the notion of a single universal effectivity formula that will make just everybody immensely successful. We all need to figure out by ourselves what helps us on our way and what is detrimental to what we want to achieve.
In response to the last comment by TJERK. Dabble in things within the subset of your priority. I focus on xyz theory, I dabble in equations, look at applications and develop new skills related to the work I want to get done in xyz. I avoid taking on a new interest, networking aimlessly and commentating on issues as many academics do until I’m satisfied with my work in xyz.
Warren Buffet is one of the richest men in the world and has given over $1B to third world countries to provide abortions for the poor. One of his top priorities is killing babies.
Or, Daniel, you could look at it this way: Warren Buffett has given over $1B to third world countries to fund abortions for the poor. One of his top priorities is making opportunities for women – to go back to school, to go back to work, to better love and care for the living human beings already in their lives.
What a wonderful, human, thing to do with $1B.
What would you have spent it on?
i buy it to prioritisation, but think you should prioritise objectives not goals. I use dashboards based on the “digital marketing and measurement model” from avinash. So you start with objectives, then the goals, then the kpi and finally the target. So you might have several goals but a smaller number of objectives and these need priority. As per the article circle the most important and focus on these
Cal recommended a story that expresses disappointment that someone has not yet quit their 6-figure job in order to follow their dreams? Really? Has this site been hacked?
Good article Cal. There was a reference to Warren Buffet by Guy Gottfried (another well known investor) in a recent interview for a newsletter published by Columbia’s value investing program. I reproduced it below:
Q: Other than your presentations at the Value Investing Congress, you tend to keep a low profile. What is your view on publicity as an investor?
A: …you’re quite right, I do tend to keep a low profile. Rational doesn’t have a website and it isn’t unusual for me to be contacted by prospective investors apologizing for calling or emailing me directly because they couldn’t find any other contact information and asking me to forward them to our IR person (which, of course, we don’t have).
I’ve worked hard to structure my life and work in a way where I can focus on being efficient, eliminating waste and clutter and being in total control of how I spend my time. Of all of Buffett’s great attributes, one of the most unheralded is the tremendous focus and productivity he achieves on a daily basis by structuring his life so that he can virtually always do what he enjoys and actually wants to do. I think I still have a long way to go before I perfect this, but that’s how I try tried to arrange things here as well.”
While I agree with the premise of the story, there is no way it comes from Buffett.
I agree that Buffett has gone on the record as saying that focus is the most important factor that has contributed to his success. However, he has NEVER used a list of goals as a way to prioritize his work.
Associating this unsubstantiated story to Buffett is doing a disservice to your readers…
Apparently, there were a few reactions on my initial post, including one from Cal himself.
I still think that finding the right balance between focused work (saying no to all divergences) and exploration (which also involves quite some deep work) is not that easy.
Personally, I find it beneficial to keep the goal “learn something new and different that is somehow related or potentially useful (in the future)” on my shortlist of 3-4 goals and allow it to take about 20-25% of my time. It’s incredibly surprising how often this shows to be beneficial for improving on my other goals (although this should be not so surprising given the role of the unconsciousness mentioned in Cal’s previous post)
This also reminds me of an older blog article about impact strategy: https://calnewport.com/blog/2012/06/18/impact-algorithms-strategies-remarkable-people-use-to-accomplish-remarkable-things/
Look at the two points of the Feynman strategy: it is about exactly the same straddle between focus and exploration.
I’ve always had a specific counter argument to this kind of outlook. What about getting better at doing that most important thing? Isn’t that more important than that thing itself?
I do sometimes feel that this is an excuse to procrastinate, but I keep wondering about this. I keep thinking about the right balance between doing the thing you want and getting better at doing it, and for every single thing it’s different.
Maybe I should just give up asking that question. It’s hard for me to do actual work. I even hate it. I just wish I could focus on steps that I listed for myself without a single worry.
I’m a strong believer of “Give up whatever is making you lose your focus.”
I have similar philosophy about focusing on right things as of Jobs and Buffet story. But I have other words for it. I believe on focusing on the thing you’re most passionate about. Everyone is interested in a lot of things. But when you focus on one thing that you really are passionate about everything else that you’re genuinely interested in because a distraction.
Following is an excrept from the blog post I wrote about building focus:
If you’re passionate about something, you’ll focus. If you aren’t passionate about something, you won’t be able to focus. At least when the going gets tough.
“Without passion you will welcome any distractions.”
https://www.luqmankhan.com/lifestyle/how-to-build-focus