The legendary investor Warren Buffett criticized corporate culture, as he criticized the large companies because of their hatred of the word “error” or “error”. In his last message to shareholders, Berkshire Hathaway highlighted the companies ’reluctance to recognize errors, on the contrary, with his transparency.
“During the period 2019-23, I used the phrase” error “or” error “16 times in my letters to you. Buffett wrote,” Many other huge companies have not used any of the word on this period, “with a focus on the importance of transparency in business.
In the honesty of his brand, he frankly admitted mistakes in the decisions to allocate and manage capital in Berkchire Hathaway. “Sometimes I made mistakes in assessing the future economy of one of the business that I bought for Berkshire,” Buffett wrote, acknowledging the abuse of inactive cases in both stock investments and full acquisition.
Buffett emphasized that the mistakes are inevitable at work, but delaying the corrective action is the real sin. Charlie Monger’s partner’s philosophy has long been cited: “You cannot wish for problems. It requires a procedure, no matter how comfortable.”
One of the biggest challenges, Buffett admitted, is to assess the capabilities and integrity of Berkshire. “The disappointments of sincerity can affect its financial impact, a pain that can approach a failed marriage.”
Buffett pointed out that many companies create an illusion of administrative perfection, and avoid any recognition of mistakes. “This taboo, which means administrative perfection, has always made me tense,” noting that some of the panels and analyst meetings call for words that are still unlimited such as “error” or “error”.
He suggested that this culture of silence can be dangerous for both companies and investors. By refusing to recognize mistakes, companies risk repeating them, which ultimately harms long -term growth.
Pavite, however, praised the Amazon to break this trend. The technology giant was “brutally” in the investor’s speech for the year 2021, in public discussing its mistakes. But he pointed out that such honesty is rare: “elsewhere, it was a generally happy conversation.”
Pavite believes that recognition of mistakes is not a sign of weakness-it is a step towards long-term success.
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