Warren Buffett as an entrepreneur is a vexing case as many people view him as a hero of entrepreneurship while others view him as an example of entrepreneurship run amok and/or as a man that engages in behaviors and tactics that run extremely counter to the proper characteristics of entrepreneurship. This report will cover all of that and more. Some introspection towards of the author of this report will cover as well.
Criticism & Review of Warren Buffett
No one can deny the impacts that Warren Buffett has had on the fields of business and entrepreneurship. However, other people greatly debate and even condemn the perception of how Warren Buffett has reached the heights he has gotten to. Warren's penchant for being a savvy investor that snags upstart companies and turns them into powerful organizations is viewed as opportunistic by some and some view Buffett as an opportunist rather than an actual innovator. However, Buffett's track record over the years cannot be denied or minimized because it is what it is (Taylor, 2008)
Even if what Warren Buffett has done during his life as a business and investment magnate is technically within the realm of entrepreneurship, that does not make it any less controversial. After all, the Merriam-Webster definition of entrepreneurship is "one who organizes, manages, and assumes the risks of a business or enterprise." Note that there is not much said in that definition about creation and how one stays on top and that is a huge part of the Warren Buffett story (Taylor, 2008).
One reason Warren Buffett is perhaps not the best example, at least to many, of entrepreneurship is that he does not generally create businesses from scratch. For example, the Midwest furniture giant Nebraska Furniture Mart was not a Buffett creation. Rather, NFM was created in 1937 by Rose Blumkin and it operated completely independently of Buffett and Buffett's Berkshire Hathaway for nearly half a century. That did not change until Berkshire acquired a controlling interest in 1983. Even to this day, the chain only three stores nationwide (with a fourth pending) but the stores are huge and do massive business (Livy, 2013).
There are several salient and fairly easy (albeit somewhat controversial to some) conclusions that one can draw about Buffett entrepreneurship style and form. As a general summation, the basic strategy is to do what you have to do to excel as an enterprise. One should pay no major attention or give any credence to your detractors that are condemning you even though you are adhering to the law and basic accepted ethics. The author of this report is not giving a green light to the idea of "do it if it's not illegal" but there is nothing wrong with taking advantage of an angle if one exists. Even Buffett has had to steer clear of his own officers perhaps not complying with the law and this resulted in Buffett having to cut ties with one of this lieutenants for that very reason (Ovide, 2011).
Even if the patents of others have to be licensed (or purchased) to get where one needs to get and/or you are simply perfecting the idea that someone else created, that does not mean that it's wrong to take that step if it exists. For example, before Facebook was the monster it is today, MySpace was already well-known but Facebook perfected the craft and took over the territory that MySpace once basically had to itself. For anyone to condemn Zuckerberg for doing that is simply being silly and naive as he did nothing wrong and he gave the market something that it wanted (Byrne, 2012).
Another conclusion is that while luck is not what leads to success, per the Sir Alan Sugar quote given for this assignment, it does help to know what one is getting into in terms of competition and the current marketplace. Another helpful tidbit is to have a sense of where the market is going. For example, Netflix had to know that the demand was there and that there was not enough supply to get the foothold they did. MySpace had to know about the hunger for greater online social connectivity when they came to be and the Facebook perfected the art to usurp MySpace (Martinez, 2012).
In a similar vein, overall personal goals and aims are important as well. Warren Buffett obviously wanted to be a huge figure in business investment industry and similar things can be said for the exploits of people like Rockefeller and Bill Gates, but not everyone wants that level of success and/or is simply not worried about it. However, people that aim much lower should not be chastised or condemned (Campbell, 2011).
As long as these people know where they want to be, are common-sense and non-whiny about the work it will take to get there and are content with the outcome that matches the effort they put in, then no one can really judge that person because they reaped what they sowed from an entrepreneur and "lot in life" standpoint and that is as it is should be (Campbell, 2011).
The late and great Peter Drucker certainly had some observations and beliefs that are relevant to Buffett's ascent to the stratosphere of industry. Just like the mentions throughout this report that intertwine entrepreneurship with ethics and other lines of sociological thought, Drucker did much the same thing. In fact, he went so far as to intertwine topics like history, psychology, philosophy, culture and religion. It is not unlike many other business and entrepreneurship minds that have done the same with the Art of War by Sun Tzu ("Talking Point," 2007).
Rather than the cut-throat nature of Sun Tzu's body of work, Drucker took a more pragmatic and positive approach. One such example is depicted and show in Appendix I of this report, that being management by objectives. A circular diagram is what comprises this framework and it has five major parts. Those parts, in order of the appearance on the circle, are strategic plan, tactical plan, unit objectives/improvement plan, individual manager's key results and improvement plan and lastly review and control. The circle continues as it is an ongoing process that should never stop because lack of innovation is death, in the words of Drucker and many other entrepreneurs (Drucker, 1999)(ProvenModels, 2013).
The lesson here is a good one. Improvement and strategy has to be an ongoing and never-stopping process. The whole idea of "evolve or die" is certainly valid, even if the "die" part is not immediately, but it can often be too late if a business gets too far behind the strategy or technology curve. As such, any reasonable means to keep up with the sometimes frenetic pace of technological and business/industry structures are vital. Processes and products should always be assessed and review, should always be compared to that of competitors and the proper niche and management structure has to be in place to keep it all together. This is precisely the sort of thing that Drucker's management by objectives framework is meant to address (Drucker, 1999).
Drucker went to so far as to use those other subjects to give lessons on management, entrepreneurship and doing both of them extremely well. However, Drucker was not in lockstep with private industry doing whatever they want so long as they stay within the law. For example, Drucker held that CEO's should never make more than 20 times what the rank and file members of a firm make and he was greatly offended at the huge rise in executive pay that occurred within Fortune 500 companies. He was on the record as condemning the practice as far back as the mid-1980's (Wartzman, 2009).
Many people conflate Drucker with American business thinking but that is simply not the case and the above mention of being against exorbitant salaries for executives is just the tip of the iceberg. Japanese minds love the teachings and musings of Drucker for example. Even so, there are common threads and beliefs that links all industrialized countries together but there are also a lot of different beliefs about entrepreneur principles and general ethics (Wartzman, 2009).
Despite his reputation, Mr. Drucker (just like Buffett) has been criticized for being non-factual and that his predictions often do not come true. For example, he believed the nation's financial center would shift from New York City to Washington DC and that has not happened. Even so, even people like Drucker and Buffett sometimes make wrong assumptions or guesses about what the future holds (Drucker, 1999).
Drucker, also like Buffett, was not afraid of his detractors and was not afraid to say things that were unpopular. For example, Drucker was not a huge fan of General Motors and this was true long before General Motors was nearly eviscerated by bankruptcy during, and its slow death spiral prior, to the Great Recession of 2007-2009. Similarly, Buffett wielded his entrepreneurship skills in…