Monthly Bookmarks –
143rd Edition – April 17, 2022
A truly great business must have an enduring “moat” that protects excellent returns on invested capital.Warren Buffett
1. What are the Best CEOs Doing by Setting Themselves Apart from the Rest?
According to the authors of CEO Excellence, two out of every five CEOs fail in their first eighteen months on the job. Moving from average performer to a top-quintile performer over a ten-year period is 1 in 12.
In this book, the authors reveal the top 6 activities of high-performing CEOs based on in-depth interviews and surveys. Here is that list:
- setting direction
- aligning the organization
- mobilizing through leaders
- engaging the board
- connecting with stakeholders
- managing personal effectiveness
2. Revisiting Moats
When I finish listening to long books as I did this week with Titan, by Ron Chernow, I needed something short, simple, and easy to listen to. I have about a dozen such go-to books. One of those is 100 Baggers by Christopher Mayer.
I’ve always liked the ‘moats’ analogy that Buffett uses for durable, competitive businesses. Mayer reminds us of some of the various forms of moats:
- strong brand
- a high cost to switch
- strong network effects
- the biz does something cheaper than any other
- being the biggest
I’d add one more bullet to the list–a product or service that’s nearly impossible to duplicate.
Another pragmatic and short read on this topic can be found in Pat Dorsey’s, The Little Book That Builds Wealth.
3. Seven Fatal Thinking Flaws
If you do a search on ‘best psychology books’, you will not find one of my favorite books by Matthew May, the hard-to-put-down, Winning the Brain Game.
Matthew’s mantra for addressing his seven thinking flaws is the following:
- What appears to be the problem, isn’t
- What appears to be the solution, isn’t
- What appears to be impossible, isn’t
His seven thinking flaws include leaping, fixation, overthinking, satisficing (my favorite chapter), downgrading, not invented here (NIH), and self-censoring.
If you like the writing of Robert Cialdini, Dan Ariely, the Heath brothers, and Daniel Kahneman, you’ll enjoy this one.
4. I Want to See That Spreadsheet
Before X.com and Confinity merged to become PayPal, Roelof Botha was hired by Elon Musk to create a financial model for the payments industry. “What’s the business model for the payments business? How’s the banking side of it, the deposit taking, the issuing of credit lines,” Botha wanted to know.
According to Jimi Soni in his book, The Founders, Botha believed X.com’s financial modeling was simplistic and began building a more complete set of metrics.
Over time, Botha’s spreadsheet took on oracular significance–one had to consult the model before big decisions.Page 218, The Founders
Wouldn’t you love to see that spreadsheet?
5. Frameworks Mania
For years, the only flowcharting software I used was SmartDraw, and one of their best blog writers was Fred Nickols, a consulting savant in continuous improvement and change management.
If you like visual frameworks, you can check out his repository here.
Recent CFO Bookshelf Podcast Playlist:
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