The Harvard Business School presents Seth Klarman, founder and president of the Baupost Group
Major take-aways from the interview:
I don’t think a lot about being a leader; our goal is to be “excellent” and to be proud of what we do
Main principle for leadership or management-style: “Do unto others…”
Big believer in leading by example; you can’t expect other people to do things you’re incapable of or unwilling to do yourself
Sometimes organizations are stuck, people want to do more but they haven’t been asked the right way; don’t overlook the power of re-anchoring via leading by example
Leadership stems from credibility — credibility stems from being “right” over time and from having knowledge — and from moral values
Two important moral values for leaders: [list]
Football field test; play the game from the center of the field, not near the sidelines, where it is easy to go out of bounds without intending to do so
WSJ test; live your life in a way that you would not be embarrassed to have it reported on the front page of the WSJ
Every quarter, I sit down with the non-investment team members of the firm and explain the current investment strategy; the idea is to help the rest of the firm understand why the firm is doing well or poorly; this creates a culture where everyone is on the same pageYou want to create a culture where everyone is willing to stay late to finish a job if they have to, where people will spend time double-checking for mistakes; people paying attention to detail at every level of the firm is importantLeaders don’t take credit, they give credit; be quick to give everyone around you credit, it is empowering to those peopleTurnover is a hidden cost of business; it can take so long to get someone up to speed, train them properly, get them to the point that they can contribute; treating employees properly and caring for them is a smart business decisionIf you have someone who is not getting the job done, other people are probably carrying their weight and working extra hard for them, and this isn’t fair; good leaders need to be fairGet a good mentor; find a place to work where they care about you, that will nurture you and be interested in your development; if you can find one it sets you on the road to successAn experience SK feels good about as a leader: the time the leaders of the firm decided to buy the entire firm playoff tickets for the Red Sox game that ended up being a historic game– an order of magnitude different from handing over a $1000 bonusA mistake SK made as a leader: tolerating a “difficult person” for far too long, because they were a talented individual; it poisoned the well, tarnished the moral character of the firm, led to some financial losses; focused too much on the short-term pain rather than the long-term benefit of that decisionA leader is not afraid to fail, is not afraid to be wrong or to lose money in the short-term; a leader always adheres to their principles and standardsJP Morgan: “I can do the work of a year in 9 months, but not in 12”³; it’s important to set time aside to refresh, relax, reflectMarathon, not a sprint; don’t focus on the short-term because it causes anxiety and makes you hyperactive in an effort to compensate for short-term poor performanceYou can’t be a leader if you burn out; find balance, seek a variety of interestsWorking a couple years at an intense pace (80hrs+/week) is okay if it’s for a specific purpose; ideally, if you are going to work that hard, do something entrepreneurial, then you’re doing it for yourself and the benefits, if any, accrue to youUnderstand that if you plan to compete by being willing to work 100 hours a week, you’ll be beat by people willing to work 110 hours[/list]The Harvard Business School presents Seth Klarman, founder and president of the Baupost Group
Major take-aways from the interview:
I don’t think a lot about being a leader; our goal is to be “excellent” and to be proud of what we do
Main principle for leadership or management-style: “Do unto others…”
Big believer in leading by example; you can’t expect other people to do things you’re incapable of or unwilling to do yourself
Sometimes organizations are stuck, people want to do more but they haven’t been asked the right way; don’t overlook the power of re-anchoring via leading by example
Leadership stems from credibility — credibility stems from being “right” over time and from having knowledge — and from moral values
Two important moral values for leaders: [list]
Football field test; play the game from the center of the field, not near the sidelines, where it is easy to go out of bounds without intending to do so
WSJ test; live your life in a way that you would not be embarrassed to have it reported on the front page of the WSJ
Every quarter, I sit down with the non-investment team members of the firm and explain the current investment strategy; the idea is to help the rest of the firm understand why the firm is doing well or poorly; this creates a culture where everyone is on the same pageYou want to create a culture where everyone is willing to stay late to finish a job if they have to, where people will spend time double-checking for mistakes; people paying attention to detail at every level of the firm is importantLeaders don’t take credit, they give credit; be quick to give everyone around you credit, it is empowering to those peopleTurnover is a hidden cost of business; it can take so long to get someone up to speed, train them properly, get them to the point that they can contribute; treating employees properly and caring for them is a smart business decisionIf you have someone who is not getting the job done, other people are probably carrying their weight and working extra hard for them, and this isn’t fair; good leaders need to be fairGet a good mentor; find a place to work where they care about you, that will nurture you and be interested in your development; if you can find one it sets you on the road to successAn experience SK feels good about as a leader: the time the leaders of the firm decided to buy the entire firm playoff tickets for the Red Sox game that ended up being a historic game– an order of magnitude different from handing over a $1000 bonusA mistake SK made as a leader: tolerating a “difficult person” for far too long, because they were a talented individual; it poisoned the well, tarnished the moral character of the firm, led to some financial losses; focused too much on the short-term pain rather than the long-term benefit of that decisionA leader is not afraid to fail, is not afraid to be wrong or to lose money in the short-term; a leader always adheres to their principles and standardsJP Morgan: “I can do the work of a year in 9 months, but not in 12”³; it’s important to set time aside to refresh, relax, reflectMarathon, not a sprint; don’t focus on the short-term because it causes anxiety and makes you hyperactive in an effort to compensate for short-term poor performanceYou can’t be a leader if you burn out; find balance, seek a variety of interestsWorking a couple years at an intense pace (80hrs+/week) is okay if it’s for a specific purpose; ideally, if you are going to work that hard, do something entrepreneurial, then you’re doing it for yourself and the benefits, if any, accrue to youUnderstand that if you plan to compete by being willing to work 100 hours a week, you’ll be beat by people willing to work 110 hours[/list]The Harvard Business School presents Seth Klarman, founder and president of the Baupost Group
Major take-aways from the interview:
I don’t think a lot about being a leader; our goal is to be “excellent” and to be proud of what we do
Main principle for leadership or management-style: “Do unto others…”
Big believer in leading by example; you can’t expect other people to do things you’re incapable of or unwilling to do yourself
Sometimes organizations are stuck, people want to do more but they haven’t been asked the right way; don’t overlook the power of re-anchoring via leading by example
Leadership stems from credibility — credibility stems from being “right” over time and from having knowledge — and from moral values
Two important moral values for leaders: [list]
Football field test; play the game from the center of the field, not near the sidelines, where it is easy to go out of bounds without intending to do so
WSJ test; live your life in a way that you would not be embarrassed to have it reported on the front page of the WSJ
Every quarter, I sit down with the non-investment team members of the firm and explain the current investment strategy; the idea is to help the rest of the firm understand why the firm is doing well or poorly; this creates a culture where everyone is on the same pageYou want to create a culture where everyone is willing to stay late to finish a job if they have to, where people will spend time double-checking for mistakes; people paying attention to detail at every level of the firm is importantLeaders don’t take credit, they give credit; be quick to give everyone around you credit, it is empowering to those peopleTurnover is a hidden cost of business; it can take so long to get someone up to speed, train them properly, get them to the point that they can contribute; treating employees properly and caring for them is a smart business decisionIf you have someone who is not getting the job done, other people are probably carrying their weight and working extra hard for them, and this isn’t fair; good leaders need to be fairGet a good mentor; find a place to work where they care about you, that will nurture you and be interested in your development; if you can find one it sets you on the road to successAn experience SK feels good about as a leader: the time the leaders of the firm decided to buy the entire firm playoff tickets for the Red Sox game that ended up being a historic game– an order of magnitude different from handing over a $1000 bonusA mistake SK made as a leader: tolerating a “difficult person” for far too long, because they were a talented individual; it poisoned the well, tarnished the moral character of the firm, led to some financial losses; focused too much on the short-term pain rather than the long-term benefit of that decisionA leader is not afraid to fail, is not afraid to be wrong or to lose money in the short-term; a leader always adheres to their principles and standardsJP Morgan: “I can do the work of a year in 9 months, but not in 12”³; it’s important to set time aside to refresh, relax, reflectMarathon, not a sprint; don’t focus on the short-term because it causes anxiety and makes you hyperactive in an effort to compensate for short-term poor performanceYou can’t be a leader if you burn out; find balance, seek a variety of interestsWorking a couple years at an intense pace (80hrs+/week) is okay if it’s for a specific purpose; ideally, if you are going to work that hard, do something entrepreneurial, then you’re doing it for yourself and the benefits, if any, accrue to youUnderstand that if you plan to compete by being willing to work 100 hours a week, you’ll be beat by people willing to work 110 hours[/list]
