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

“The system in place corrupts you with so much autonomy and authority that you can’t imagine leaving.”

focus on industries with attractive economic characteristics, selectively use leverage to buy occasional large properties, improve operations, pay down debt, and repeat.

you can keep your head when all about you are losing theirs . . . —Rudyard Kipling, “If”

believed the key to long-term value creation was to optimize free cash flow,

Each ran a highly decentralized organization; made at least one very large acquisition; developed unusual, cash flow–based metrics; and bought back a significant amount of stock. None paid meaningful dividends or provided Wall Street guidance. All received the same combination of derision, wonder, and skepticism from their peers and the business pr

This approach led to lumpy, but highly profitable, underwriting results. As an example, in 1984, Berkshire’s largest property and casualty (P&C) insurer, National Indemnity, wrote $62.2 million in premiums. Two years later, premium volumes grew an extraordinary sixfold to $366.2 million. By 1989, they had fallen back 73 percent to $98.4 million

What separated these CEOs (and the performance of their companies) was two distinctly different mind-sets. The outsider CEOs, like Stonecipher and Tillerson, tended to dance when everyone else was on the sidelines and to cling shyly to the periphery when the music was loudest. They were intelligent contrarians willing to lean against the wall indef

“After we acquired a number of businesses, we reflected on business. Our conclusion was that the key was cash flow. . . . Our attitude toward cash generation and asset management came out of our own thinking.”

“The system in place corrupts you with so much autonomy and authority that you can’t imagine leaving.”