Buffett’s #1 Priority; Buffett’s #1 Rule; Apple’s #1 Ranking; Ford’s #1 Discipline

"…keeping you great"

HEADLINES:
 
Good to See Steve — thanks for the feedback on my choice of Dennis Crowley for replacing Steve Jobs, hopefully no time soon. It was great to see Steve debut the iPad 2. And congrats to Apple for four-peating as #1 on Fortune's Most Admired Company list released this week. Google, Berkshire Hathaway, Southwest Airlines, Proctor & Gamble, Coca Cola, Amazon, Fedex, Microsoft, and McDonalds round out the top 10.

Buffett's Annual Letter — upbeat about the future of the US, I didn't find his letter as interesting as past letters. However, go to what is page 26 of the PDF (marked page 104) and read his two-page Memo to all Berkshire Managers (what he calls his "All Stars"). In this biennial memo, he reemphasizes his number 1 priority and asks for letters outlining who each manager has chosen to replace themselves if something happens to them. It's also worth reading his "PS" in the memo.

Always have Liquidity — p23 of Buffett's letter is a copy of a letter his grandfather, Ernest Buffett, sent to his youngest son (all the children received a similar letter). In essence, it emphasizes the importance of having spare cash sitting around to cover unseen challenges and opportunities. For Warren, this #1 rule means that Berkshire will always have a minimum of $10 billion in cash, and normally $20 billion, so they can always weather the storms or jump on bargains. How much cash do you keep stowed away? Please read Ernest Buffett's letter.

$136 Billion Revenue — Fortune magazine, as always, does a nice summary of Buffett's letter. Though Buffett didn't outperform the S&P 500 in 2010, his firm will break into the top ten in revenue for the first time. And as discussed last year, his acquisition of Burlington Northern appears to have been a brilliant move, given that a ton of product can be moved by rail for one-third the fuel it takes by truck. Buffett's now on the look-out for his next big purchase.

Ford's Rockefeller Habits — check out paragraph two in the BusinessWeek article on Ford CEO Alan Mulally's management disciplines which includes a 2.5 hour weekly meeting with his 15 top execs where they review 300 posted charts, color-coded red, yellow, and green. Quoting the article, "As the CEO likes to say, 'You can't manage a secret. When you do this every week, you can't hide.'" And notes Anne-Marie Renoud, the "Soap Queen" and founder of Brambleberry, who alerted me of the article, "Sounds just like the Rockefeller Habits." The basics are the basics!

Rockefeller Funds Apple and Intel — in doing some research for a speech comparing entrepreneurship in Europe and the US, I stumbled across the fact that Laurence Rockefeller, considered one of the founders of the venture industry back in the early 1930s, funded Apple and Intel through his venture firm Venrock. Makes me a little more proud of the Rockefeller connection.

Limited to 15 YPO Firms — YPO International is, again, hosting a 2.5 day advanced "Making the Rockefeller Habits Rock" workshop October 27 – 29 immediately following our Fortune Growth Summit in Phoenix, AZ. The YPO link.