“My dad had various nicknames for me. He'd call me ‘fireball’ sometimes because I'd start little businesses. He didn't care about money at all. He believed very much in having an inner scorecard and he never worried about what other people are thinking about you. Just know why you're doing what you're doing. That's good enough,” Warren Buffett (Trades, Portfolio) once revealed in an interview.
This quote captures the essence of one of the most important principles behind the Berkshire Hathaway (BRK.A, Financial)(BRK.B, Financial) leader's phenomenal success, namely his “inner scorecard” concept – the idea that we should judge ourselves based on our own standards, not the validation or opinions of others.
The inner scorecard vs. the outer scorecard
To understand the inner scorecard, it is helpful to distinguish it from its counterpart – the outer scorecard. The outer scorecard refers to judging yourself based on external standards like money, fame, status and the validation of other people. With an outer scorecard, you care excessively about what others think of you. You seek to impress people and earn their admiration. Your self-worth becomes contingent on meeting goals and expectations set by society.
In contrast, the inner scorecard means you set your own standards for success. Your sense of achievement comes from meeting goals that reflect your personal values – not arbitrary societal benchmarks. With an inner scorecard, you march to the beat of your own drum. You are not swayed by outside perceptions or the need for validation.
His father's influence
Buffett credits his father with giving him excellent guidance growing up. He taught him that it is more important to have an "inner scorecard" than an "outer scorecard" when it comes to judging your actions and decisions.
He explained that some people become preoccupied with how the world will view their every move and decision. They constantly worry about their public image and what others will think, rather than focusing on their own self-assessment.
But his father advised him that the most important thing is to have a strong internal basis for making choices This means doing what you believe is right, not what will impress others or garner external praise. The opinions of others should not override your own inner sense of what is good, ethical and meaningful.
Why the inner scorecard matters
The inner scorecard is so powerful because it gives you freedom. When your source of pride and fulfillment comes from within, you have independence of thought and action. You are liberated to live authentically, make bold decisions and stay grounded in times of success and failure.
In contrast, with an outer scorecard, you become imprisoned by the expectations of others. You contort yourself to fit an image, compromising your principles. You shy away from moves that could be unpopular, stifling creativity. Success loses meaning since you are playing someone else’s game.
The inner scorecard in practice
This distinction is critical to the "Oracle of Omaha." Guy Spier (Trades, Portfolio), who won a charity lunch with Buffett, wrote:
“One of Buffett’s defining characteristics is that he so clearly lives by his own inner scorecard. There’s nothing fake or forced about him. He sees no reason to compromise his standards or violate his beliefs.”
This level of self-determination allows clear, rational thinking. With an inner scorecard, you make decisions based on their merits, not how they will be perceived. Buffett avoided disastrous dot-com investments because he evaluated ideas by his own logic, not the get-rich-quick mania sweeping Wall Street.
Inner scorecard and resilience
The inner scorecard also enables imperviousness to criticism and temporary failure. Since you judge yourself by your own standards, outside condemnation does not impact your self-worth. Setbacks are learning experiences, not affirmations of inadequacy. For instance, Buffett could shrug off naysayers in his early years because he believed in his strategy, not what others preached.
Ultimately, the inner scorecard leads to authenticity, the gateway to genuine fulfillment. You do not have to pretend to be someone you are not. Your self-validation comes from within, not applause or trophies. Ironically, this inner confidence attracts outer success too.
How Buffett mastered his inner scorecard
Buffett was wired from birth with an independent, inner-driven personality. But his father instilling the inner scorecard mindset early on gave him an unshakable foundation that shaped the rest of his life.
He exemplifies total mastery of the inner scorecard in countless ways. First, Buffett judges himself by long-term business value, not short-term stock prices. He also sticks to his investing style despite criticism for missing trends.
Second, Buffett lives humbly despite his vast wealth. He doesn’t flaunt designer suits or luxury. He even politely turned down a Presidential Medal of Freedom, feeling he did not deserve it.
The guru also criticizes bad policies of political candidates he supports, like President Obama.
The investor is not chasing validation or outside affirmation. Buffett dances to no one’s tune but his own. He lives purely by his inner scorecard.
The inner scorecard in action
Mastering your inner scorecard is simple in concept, but challenging in practice. It requires ruthless self-honesty and commitment to principle over expedience.
Here are some tactical steps to help strengthen your inner scorecard:
- Identify your core values. What matters most to you? What principles govern your life?
- Audit your decisions and actions. Are you compromising values for validation or acclaim? Are you being true to yourself?
- Check that goals reflect inner ideals, not external benchmarks. Whose standards are you chasing?
- Beware people-pleasing and approval-seeking. Be willing to take unpopular stands if the facts warrant it.
- Judge yourself by long-term measures, not short-term wins. Are you developing meaningful skills and attributes?
- Let character and contributions – not trophies or wealth – be your measure of success.
- Find courage in self-reliance. You alone must validate your life path based on your values.
- Surround yourself with people who appreciate you for you, not an artificial persona.
Conclusion
Mastering your inner scorecard takes constant reflection and vigilance. But it is immensely freeing to base pride and fulfillment on living your values versus chasing validation. This inner strength is how Buffett achieved unprecedented success and happiness based on his own criteria of excellence. He controlled his own destiny.
And just like with the legendary investor, the world will beat a path to your door when you pave your own. Focus on your inner scorecard, and let it guide you to a life of authenticity, fulfillment and purpose.
