8 lessons from Drucker, Buffett and Valls-Taberner
Paralyzed by indecision? Tactics from Peter Drucker, Luis Valls-Taberner and Warren Buffett can help you make better decisions.
Peter Drucker, commonly referred to as the father of modern management, famously said that the best way to predict the future is to create it. Easy to say, but in a world that seems to have been turned upside down — or, as Guido Stein puts it, “turned inside out like a sock” — doing so is quite a challenge. Stein’s new book Decisión y acción (available in Spanish), written during the pandemic, takes up the gauntlet that Drucker laid down. Its aim is to help you build tomorrow, when today seems incomprehensible.
To this end, Stein turns to the superstars of management: Drucker (1909-2005), author, educator and management consultant; Luis Valls-Taberner (1926-2006), expert in banking; and Warren Buffett (1930), of investment fame. Using these eminently successful men as examples, Stein shows how to make informed and sensible decisions — even when you don’t know where to start. He discusses how they achieved what they did — focusing on the how, rather than the what.
A stellar lineup
Drucker, Valls-Taberner and Buffett had a lot in common, beyond their impressive longevity. They were all experts at assessing the key factors of decision-making that are as relevant today as they ever were. Perhaps it isn’t surprising that their ideas have endured so well: to a large extent, these men anticipated the world of today.
Take note of Drucker, Valls-Taberner and Buffett’s advice before making your next decision.
Go back to the beginning. Make sure you’re aware of the origins of the problem. Talk it through with people to ensure you aren’t biased and are working with the full set of facts. If Drucker is still one of the best guides for entrepreneurs and managers today, it is partly thanks to the fact he put his full five senses into learning the territory and drawing a detailed map.
Sharpen your gaze. Try to observe the things that go unnoticed. Pay attention to what’s happening around you. Valls-Taberner was a tireless observer: “Few things escaped his curiosity,” Stein observes. Likewise, adopt the sort of pluridimensional and synthesizing vision that Stein believes made Drucker a “true humanist of the business world.”
“Stick to the golden rule of any business: listen to customers and discover if they’re satisfied. The public, your public, always knows better than the so-called experts.” — Luis Valls-Taberner
Take time to reflect. Dedicate some time each day to thinking things over, especially when it comes to future-defining decisions. You may find, as Warren Buffett has, that reading helps you to become a more discerning thinker: “I read, and I think. So, I do more reading and thinking, and make fewer impulse decisions than most people in business,” he has claimed. Along with reflection, apply common sense, particularly when it comes to investing: “Never invest in businesses you cannot understand,” advises Buffett, the poster boy for common sense. And don’t get in over your head: “Rational people don’t risk what they have and need for what they don’t have and don’t need.”
“Successful investing takes time, discipline and patience. No matter how great the talent or effort, some things just take time.” — Warren Buffett
Ask questions and don’t assume the answers. Instead of trying to have the right answer for everything, look for the right question. For Drucker, while asking the right question was no guarantee of success, asking the wrong question might be worse than asking no question at all. He also believed there were three questions all leaders should be able to answer: What are my strengths? What results am I getting? What are my values?
“My greatest strength as a consultant is to be ignorant and ask a few questions.” — Peter Drucker
Combine theory and practice. For well-executed decision-making, build upon what’s real, and refer back to it frequently to test your actions. The basic idea is to make sure your theories are working in practice. Trial and error will allow you to see problems and even the most subtle changes more clearly, which will result in a more efficient and effective coordination of criteria and objectives. The phrase, “There’s nothing as practical as a good theory,” is apt here, as is Drucker’s belief that his consulting life was, in essence, his laboratory.
“All my theories have been successively tested in practice.” — Peter Drucker
Plan, both for the medium and long term. Keep your eyes on the horizon, because that is where, as a manager, leader or businessperson, you should be directing your thoughts. Keep in mind that “long-range planning does not deal with future decisions, but with the future of present decisions,” as Drucker said. Be realistic and keep your weaknesses in mind. Don’t fall into the error of believing yourself to be without weakness, Buffett cautions. And beyond yourself and your own needs and aspirations, you should also think about what society needs in the long term.
“In the long term, the business of banking will only develop if we place the customer at the center of our efforts, each and every day.” — Luis Valls-Taberner
Look for ways to use what you know. Seek out opportunities to put your thoughts and advice to the test. Be pragmatic and keep a sense of perspective. You need to see the big picture, rather than its components.
“The result of conflict management — indeed, the only way to resolve a conflict — is neither by victory, nor by compromise. It’s the integration of different interests.” — Peter Drucker
Don’t be afraid of errors, learn from them! Speak about failures openly, with a view to learning from them and establishing procedures for similar problems in the future. This is what Valls-Taberner did regarding mistakes made by his company, employees or customers — with a transparency that has rarely been seen in the business world. Risk being wrong. As he himself said, there’s something worse than making a mistake: the fear of making it.
“I have learned more from studying the failures of others than the causes of their successes.” — Luis Valls-Taberner
These three experts have inspired Stein throughout his career. How might their wisdom enrich your own professional journey, too?