Everybody in business knows at least a little bit about Warren Buffet, the Chairman and CEO of Berkshire Hathaway. (He is worth about $53 billion.)
Not so many people know about his business partner Charles Munger. He is the Vice Chairman of Berkshire Hathaway and a billionaire himself.
I've mentioned a book on this blog before by Peter Bevelin titled Seeking Wisdom: From Darwin to Munger. It is a fantastic book (although it may no longer be in print). There is a great quote in the book from Charles Munger that says:
"The iron rule of nature is: you get what you reward for. If you want ants to come, you put sugar on the floor."
As someone running a business, it's important to occasionally stop and think about what you "reward for". What are the important objectives you want to achieve this year? And what rewards do you have in place to help make them happen?
The Big Question
Here's a related question: What do you expect from your CFO?
It's true that your accounting function has only two objectives. The first is to help you improve financial results. The second is to help you attract capital.
Are you rewarding for boring financial statements that lack insight? (Most CEO's are.)
Now is a great time to consider what you expect from the role of CFO in your company. Then reward for that.
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