In the book, The Outsiders, William Thorndike explores eight unconventional CEOs who have beat their industry peers and the overall market returns over long periods through both bull and bear markets. One of the common threads among these CEOs is their tenure as CEO. All of them served as CEO for more than 20 years.
In contrast, Dr. Ralph Z. Sorenson, member of the Board of Directors of Whole Foods, said in a recent interview that in his years of reviewing business plans, many describe an "Exit Strategy" along the lines of: "We aim to be bought by a larger company" or "Cash out at IPO".
In a survey conducted in 1999, twenty five percent of Americans believe that the lottery is their best chance at getting rich.
Waiting is hard. Waiting is boring. Warren Buffett himself said that his business is boring. That is why very few people do it. And yet he is one of the richest people in the world. And he did not get rich overnight.
There is a saying, "Patience is not a virtue, it is a necessity." Instant gratification is easy, and is preferred by many. Delayed gratification is more satisfying, but requires a certain mindset.
Many CEOs fall to pressure from Wall Street to demonstrate good results quarter over quarter. Many of them take the short term view, looking to hold the company shares for a few seasons. Great CEOs are like small business owners. They see their business as their livelihood, as a going concern, to increase long term shareholder value, and they act accordingly. They take the long term view. They may sacrifice short term profits for long term growth.
Great investors do not buy stocks, they buy stakes in companies. They become business owners. They buy the businesses after learning what they can about the company, and conclude that it can create long term value for them. They become involved in the business by continuing to study and analyze them. And if their conclusion has changed, they are not afraid to sell, even at a loss.
In day to day operational work, the long term view is sometimes overlooked. In the pressure to deliver results, or to satisfy an immediate need, it is easy to forget long term ramifications of any process change or system change. What may sound trivial now may result in a greater cost down the road should business climate change. It then becomes very important to balance short term requirements against long term impacts.
Always, ALWAYS, consider the long term view.
