Free Essay: Book Review of "The Real Warren Buffett - Managing Capital, Leading People"

The article Book Review of The Real Warren Buffett – Managing Capital, Leading People by Cevdet Kizil is a review of the book The Real Warren Buffett – Managing Capital, Leading People, by James O’O’Louglin. The author writes on Warren Buffett’s leadership and management skills, which has established him among the most successful people in the world, and the second richest man in the US. The key to success for Warren Buffett as the chief executive of his business has been his mastery in keeping his employees motivated and managing finances (Kizil, 2017). Warren emphasizes that money is not the solution to all problems in business, thus the need to have motivated employees.

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Warren Buffet emphasizes the importance of establishing loyalty among your employees. Leadership is the mastery of how to lead people efficiently, and it is not through punishing, forcing or dragging. Attracting the right employees and building loyalty is the key to success for any business. Setting stretched goals for employees and following up on them to get things done creates mistrust, which may be costly for an organization if not checked. Such was the leadership style of Jack Welch, who is criticized in the book for his command and control, which caused significant losses to at General Electric (Kizil, 2017). On the other hand, Warren Buffet believes in the philosophy of letting high-rated employees work unencumbered. He believes that human beings tend to reciprocate trust with effort and compliance. Warren Buffet also encourages managers to learn from their past mistakes and use them as a stepping stone to better decision-making.

A famous quote by Lao Tzu, a Chinese Philosopher, is also mentioned in the article. Lao Tzu quotes that “Intelligent control appears as uncontrol or freedom. And for that reason, it is genuinely intelligent control. Unintelligent control appears as external domination. And for that reason, it is really unintelligent control (Kizil, 2017).” The quote is used effectively as it is related to control and leadership. The article also emphasizes the relationship between strategic planning and effective leadership and their contribution to the success of an organization. Strategic planning ensures that an organization is better positioned for immense success in the future, while ethical leadership guides the organization towards realizing this. The article continues to criticize controlled leadership through the works of Jonathan Freedman and Dr. Robert Cialdini. Their two findings reveal that control and fear for employees are not effective, as the employees tend to engage in undesirable actions whenever there is no monitoring.

A good leader must know how to communicate effectively to his employees. For instance, when giving out instructions, they should communicate all the details to the employees for them to internalize everything. This way, the employees will be in charge of their actions, and they won’t need to be monitored to take the right actions. Warren buffet also believes in rewarding as a motivational tool. He states that employees should be paid based on their performance and their ability to meet their set targets. Warren is also against lay-offs for employees, as employees who have a sense of security for their jobs work hard for the organization even in tough times, as they possess a sense of belonging (Kizil, 2017). Good managers should also implement empathy, according to the article. According to Warren Buffett, managers should not have trouble in putting themselves into the shoes of shareholder-owners.

The article is well-organized and effectively captures all the relevant details in the book. The flow of ideas from the book follow systematically, capturing every section of the reviewed book. The article also captures the works of all the mentioned managers and philosophers, in comparison to the philosophy of Warren Buffett. Warren Buffett’s philosophy ais well presented, and his ethical leadership style well laid out.

References

Kizil, C. (2017). Book Review of “The Real Warren Buffett - Managing Capital, Leading People”. EMAJ: Emerging Markets Journal, 6(2), 43-46. https://doi.org/10.5195/emaj.2016.117