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The Outsiders: Eight Unconventional CEOs and Their Radically Rational Blueprint for Success

William N. Thorndike · 4 HN comments
HN Books has aggregated all Hacker News stories and comments that mention "The Outsiders: Eight Unconventional CEOs and Their Radically Rational Blueprint for Success" by William N. Thorndike.
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Amazon Summary
“An outstanding book about CEOs who excelled at capital allocation.” — Warren Buffett #1 on Warren Buffett’s Recommended Reading List, Berkshire Hathaway Annual Shareholder Letter, 2012 Named one of “19 Books Billionaire Charlie Munger Thinks You Should Read” in Business Insider. “A book that details the extraordinary success of CEOs who took a radically different approach to corporate management.” — Charlie Munger, Vice-Chairman of Berkshire Hathaway Corporation “Thorndike explores the importance of thoughtful capital allocation through the stories of eight successful CEOs. A good read for any business leader but especially those willing to chart their own course.” — Michael Dell, chairman of the board of directors and chief executive officer of Dell What makes a successful CEO? Most people call to mind a familiar definition: “a seasoned manager with deep industry expertise.” Others might point to the qualities of today’s so-called celebrity CEOs—charisma, virtuoso communication skills, and a confident management style. But what really matters when you run an organization? What is the hallmark of exceptional CEO performance? Quite simply, it is the returns for the shareholders of that company over the long term. In this refreshing, counterintuitive book, author Will Thorndike brings to bear the analytical wisdom of a successful career in investing, closely evaluating the performance of companies and their leaders. You will meet eight individualistic CEOs whose firms’ average returns outperformed the S&P 500 by a factor of twenty—in other words, an investment of $10,000 with each of these CEOs, on average, would have been worth over $1.5 million twenty-five years later. You may not know all their names, but you will recognize their companies: General Cinema, Ralston Purina, The Washington Post Company, Berkshire Hathaway, General Dynamics, Capital Cities Broadcasting, TCI, and Teledyne. In The Outsiders, you’ll learn the traits and methods—striking for their consistency and relentless rationality—that helped these unique leaders achieve such exceptional performance. Humble, unassuming, and often frugal, these “outsiders” shunned Wall Street and the press, and shied away from the hottest new management trends. Instead, they shared specific traits that put them and the companies they led on winning trajectories: a laser-sharp focus on per share value as opposed to earnings or sales growth; an exceptional talent for allocating capital and human resources; and the belief that cash flow, not reported earnings, determines a company’s long-term value. Drawing on years of research and experience, Thorndike tells eye-opening stories, extracting lessons and revealing a compelling alternative model for anyone interested in leading a company or investing in one—and reaping extraordinary returns.
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Hacker News Stories and Comments

All the comments and stories posted to Hacker News that reference this book.
Not specific to just tech teams, but I loved The Outsiders: Eight Unconventional CEOs and Their Radically Rational Blueprint for Success by William Thorndike. So many great notes about leadership and successfully running a business in general.

https://www.amazon.com/Outsiders-Unconventional-Radically-Ra...

There's an excellent book (you're probably aware of) called The Outsiders. It compares the results of operations focused CEO's like Welch to capital allocators like Buffett, Singleton, and Malone. The thesis is that overtime, the good cap allocators just blow everyone else out of the water.

http://www.amazon.com/Outsiders-Unconventional-Radically-Rat...

“An outstanding book about CEOs who excelled at capital allocation.” — Warren Buffett

⬐ spinchange
I was not aware of this one but appreciate the recommendation! I've also been a follower of John Malone's over the years so this sounds like a very interesting read. Added to my list!
⬐
Aug 10, 2015 · knes on G is for Google
It's almost as if they read "the outsiders"[0]

[0] http://www.amazon.com/The-Outsiders-Unconventional-Radically...

⬐ storgendibal
Yes! Both FB and now G are organized this way. Warren Buffet is really something else.
Hi Joel- thanks for being open to the feedback.

Like you said, you are in growth mode. To me, growth mode means reinvesting as much of the profits as possible back into the company. Paying yourself a large salary during this time is the same as taking money off the table.

There are some good reasons to take money off the table, like paying back personal debt or supporting family members. But paying yourself more because you're the CEO doesn't seem like a good one, because your equity position is so significant.

If you don't have a good reason to take money off the table, it signals to employees and investors that "Joel thinks the money is better spent going into his personal bank account vs. making the company's equity grow in value." That sort of logic doesn't work in a startup that is targeting high growth, where employees are hoping to receive some sort of payoff from their equity. Moreover, it casts doubt on your judgment in capital allocation, which is one of the most important responsibilities of a founder / CEO. *

Obviously, all of this logic falls apart if you're not working on a startup. Low growth businesses that have achieved much of their potential are a totally different story. But you aren't starting a restaurant. Even Uber, at its $4B valuation, is giving compensation packages that are weighted towards options vs. salary.

* http://www.amazon.com/The-Outsiders-Unconventional-Radically...

⬐ joelgascoigne
Thanks for the detailed comment, that makes a lot of sense to me. Also, what an awesome book that looks like. I've just grabbed it. Thanks.
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