I have learnt that success comes from passion. Every investment that we make is passion based. The book introduces Warren Buffet as a man who is content and who loves what he does. I have subsequently learnt that the best business opportunities also thrive on passion. I should ask myself if I genuinely like doing what I am thinking of investing in.
In addition, I have learnt that I need to have the qualities of an investor for me to succeed in business. These include patience, discipline, flexibility, courage, confidence, and decisiveness. Each of these qualities plays a significant role in producing an investor who is bound to be successful. In addition, I need to be sharp and look for investment opportunities where the risks are minimal to increase the chances of success. I should not go on it as if it is a gamble (Hagstrom, R G, 98).
On acting decisively, I have learnt that when the shares of a company are selling below their intrinsic value, it is always advantageous to make a bold decision to invest in the shares. This is what Warren Buffet did when American Express saw its shares fall from $65 to $35 almost overnight. He put forty percent (40%) of his partnership stock here and in two years time, the returns were triple.
I will use the knowledge I have acquired to engage in manufacturing business. I want to manufacture steel products such as wires and export them to the less developed countries in the world. Like Warren Buffet, I would look for like-minded partners and strike a deal with them on how we can do this together. The export business of manufactured products is an excellent analysis of the environment which is vital as part of strategic management.
I would then set out my strategies. This will include the source of my steel. I would target the largest producers of steel in the world. Such companies include, ArcelorMittal in Luxembourg and Hebei Iron and Steel in China would be my target.
If I were Warren Buffet, I would have worked with more experienced people first. Although Buffet became a successful investor after incorporating some of his classmates in his partnership business, this may not be advisable. It is essential to work with people who understand the prevailing market conditions and who may thus advise me and other managers accordingly.
This book related to strategic management in that Warren Buffer teaches many managers how to engage in strategic management in their entities. Buffet engages in strategic management as follows:
Analyzing the environment.
When he was investing in stock, he realized that the environment was conducive for this investment. It is beneficial that the investor analyzes his or her environment. Scanning the environment allows the investor to make the best decision on what he or she will invest in (Hagstrom, R. G, 113).
Warren Buffet then formulated his strategies, which included making some of his classmates in college, colleagues in business. Some of them became partners. These steps make the investment decision to succeed. Properly set out strategies are winning strategies.
Implementing the strategies, Warren Buffet then set out his business by purchasing shares worth $100. The set out strategies subsequently are put into practice.
Evaluating the strategies, this means reviewing the whole procedure to find out if it is working effectively. Warren Buffet does this from time to time. He is the richest investor in stock, in the world. This means that his strategies worked (Hagstrom, R. G. 103).
I have seen how lucrative the stock business is judging from Warren Buffet’s way. However, I would not invest in shares the same way he did. I would rather go to manufacturing. Buffet invested in shares primarily because he understood how this industry operates. He also had a passion for investment in stocks.
However, my passion is more inclined towards manufacturing. Here, I can get quicker returns. The trick is to ensure that the commodities my business entities manufacture are high quality products. I would then engage in intensive marketing of the products. One of the things I can engage in manufacturing is products of steel such as wires and sheets for roofing buildings. The industry in the developing countries is open to such investments, and I would not hesitate to be part of it.
Hagstrom, Robert G.. The Warren Buffet way: investment strategies of the world's greatest investor.. New York: Wiley, 1995. Print.