Quotes in business

Most businesses change in character and quality over the years, sometimes for the better, perhaps more often for the worse. The investor need not watch his companies' performance like a hawk; but he should give it a good, hard look from time to time.

There are four prongs of quality and four ways to improve quality of product and service:

- Innovation in product and service
- Innovation in process
- Improvement of existing product and service
- Improvement of existing process

The common mistake is the supposition that quality is ensured by No. 4, improvement of process, that operations going off without blemish on the factory floor, in the bank, in the hotel will ensure quality. Good operations are essential, yet they do not ensure quality. Quality is made in the boardroom.

A bank that failed last week may have had excellent operations— speed at the tellers’ windows with few mistakes; few mistakes in bank statements; likewise in the calculation of interest and of penalties and loans. The cause of failure at the bank was bad management, not operations.

If football taught me anything about business, it is that you win the game one play at a time.

Too often, executive compensation in the U.S. is ridiculously out of line with performance. That won't change, moreover, because the deck is stacked against investors when it comes to the CEO's pay. The upshot is that a mediocre-or-worse CEO - aided by his handpicked VP of human relations and a consultant from the ever-accommodating firm of Ratchet, Ratchet and Bingo - all too often receives gobs of money from an ill-designed compensation arrangement.

The ability to learn faster than your competitors may be the only sustainable competitive advantage.

Consultants are people who borrow your watch and tell you what time it is, and then walk off with the watch.

Great discoveries and improvements invariably involve the cooperation of many minds.

It is not the employer who pays the wages. Employers only handle the money. It is the customer who pays the wages.

New product and new types of service are generated, not by asking the consumer, but by knowledge, imagination, innovation, risk, trial and error on the part of the producer, backed by enough capital to develop the product or service and to stay in business during the lean months of introduction.

No defects, no jobs. Absence of defects does not necessarily build business… Something more is required.