How This 50 Year Old Book Taught Bill Gates and Warren Buffett an Unforgettable Business Lesson

William H. Gates III reacts

We frequently forget that great works of literature can still teach us a lot about ourselves decades or even centuries after they’ve been written. That is just one of the points Bill Gates recently made in his blog titled “The Best Business Book I’ve Ever Read,” where he shares why an old collection of business stories from the 1960s he received from a friend still remains the best business book he’s ever read.

It starts in 1991, shortly after Gates first met Warren Buffett.

“I asked him to recommend his favorite book about business. He didn’t miss a beat: “It’s Business Adventures, by John Brooks,” he said. “I’ll send you my copy.”

What was the first reason for why Gates like John Brooks’ writing? It was quite different from today’s rather misleading, oversimplified, bullet pointed list articles meant for people who are too lazy to take the time to read anymore.

“Unlike a lot of today’s business writers, Brooks didn’t boil his work down into pat how-to lessons or simplistic explanations for success… You won’t find any listicles in his work. Brooks wrote long articles that frame an issue, explore it in depth, introduce a few compelling characters, and show how things went for them.”

Through Brooks’ analysis of companies and the business leaders who led them decades ago, one lesson still holds true that Gates used at Microsoft and still uses for the Bill and Melinda Gates Foundation.  Gates explained:

“Brooks’s work is a great reminder that the rules for running a strong business and creating value haven’t changed. For one thing, there’s an essential human factor in every business endeavor. It doesn’t matter if you have a perfect product, production plan, and marketing pitch; you’ll still need the right people to lead and implement those plans.

That is a lesson you learn quickly in business, and I’ve been reminded of it at every step of my career, first at Microsoft and now at the foundation. Which people are you going to back? Do their roles fit their abilities? Do they have both the IQ and EQ to succeed? Warren is famous for this approach at Berkshire Hathaway, where he buys great businesses run by wonderful managers and then gets out of the way.”

If there is one thing in business that never changes, number one, it’s that only through hard work and smart moves do you get into a position where your next move, number two, is to hire the right people and facilitate their talents, not control them, meaning that the most necessary skill in business boils down to being able to appraise a person’s character and skills very well.

Source: Gates Notes

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