Berkshire Hathaway, Inc. – A Great Company
Background of the Company
The origins of Berkshire Hathaway, Inc. go back to the year 1839. Oliver Chace laid down the foundation for The Valley Falls Company in Valley Falls, Rhode Island, a textile manufacturing company. A merger with the Berkshire Cotton Manufacturing Company occurred in 1929, creating a new company entitled “Berkshire Fine Spinning Associates”. This company then merged with the Hathaway Manufacturing Company, becoming Berkshire Hathaway (BH), in 1955. This merger created the largest surviving textile manufacturer in New England. Buffet Partnership, Ltd. (BPL) began purchasing stock in BH in 1962. By 1964, BPL owned approximately 7% of Berkshire’s shares. Seabury Stanton, the current …show more content…
and numerous other online entities indicate that BH has no formal Vision or Mission Statement. Berkshire Hathaway is well known for its intelligent investing. The company is an extension of Warren Buffett, and his thoughts and attitudes on the market. He is a key influencer in the financial market, and when Buffet speaks, most people listen. The vision that he communicates regularly is that Berkshire companies are well managed and have great people (Stallard, 2008). If I were to articulate a vision for Berkshire Hathaway, Inc., it would be:
“We trust our people to do the right thing. You can …show more content…
is a holding company that owns over 60 subsidiaries outright and has minority holdings in 50+ others. The portfolio of companies is diverse, and includes insurance operations, gas and electric utilities, media, specialty finance, retail, manufacturing and service companies, just to name a few. Decentralization is the operating structure for all owned subsidiaries. The responsibility for business performance is placed solely in the hands of local management personnel. The company has only two main requirements from its operating managers: submit financial statements monthly and send cash flow generated by the operations to Berkshire corporate. Management within subsidiaries are not required to meet with the executive team from corporate headquarters. It is not required to make financial projections or develop plans of strategy or plans including long-term operating targets. Instead, local management is left to operate their businesses largely without supervision or control from Berkshire corporate. The Berkshire Hathaway model is to assign the right people to the right jobs. The system has been described as “delegation just short of abdication.”(Lynch, 2015). Berkshire Hathaway does not have a separate international operation. Almost all of its portfolio of companies are based in the United States. It has minority holdings in Sanofi, a French pharmaceutical firm, and Munich Re, a re-insurance organization from Germany. In recent years Berkshire has
Background of the Company
The origins of Berkshire Hathaway, Inc. go back to the year 1839. Oliver Chace laid down the foundation for The Valley Falls Company in Valley Falls, Rhode Island, a textile manufacturing company. A merger with the Berkshire Cotton Manufacturing Company occurred in 1929, creating a new company entitled “Berkshire Fine Spinning Associates”. This company then merged with the Hathaway Manufacturing Company, becoming Berkshire Hathaway (BH), in 1955. This merger created the largest surviving textile manufacturer in New England. Buffet Partnership, Ltd. (BPL) began purchasing stock in BH in 1962. By 1964, BPL owned approximately 7% of Berkshire’s shares. Seabury Stanton, the current …show more content…
and numerous other online entities indicate that BH has no formal Vision or Mission Statement. Berkshire Hathaway is well known for its intelligent investing. The company is an extension of Warren Buffett, and his thoughts and attitudes on the market. He is a key influencer in the financial market, and when Buffet speaks, most people listen. The vision that he communicates regularly is that Berkshire companies are well managed and have great people (Stallard, 2008). If I were to articulate a vision for Berkshire Hathaway, Inc., it would be:
“We trust our people to do the right thing. You can …show more content…
is a holding company that owns over 60 subsidiaries outright and has minority holdings in 50+ others. The portfolio of companies is diverse, and includes insurance operations, gas and electric utilities, media, specialty finance, retail, manufacturing and service companies, just to name a few. Decentralization is the operating structure for all owned subsidiaries. The responsibility for business performance is placed solely in the hands of local management personnel. The company has only two main requirements from its operating managers: submit financial statements monthly and send cash flow generated by the operations to Berkshire corporate. Management within subsidiaries are not required to meet with the executive team from corporate headquarters. It is not required to make financial projections or develop plans of strategy or plans including long-term operating targets. Instead, local management is left to operate their businesses largely without supervision or control from Berkshire corporate. The Berkshire Hathaway model is to assign the right people to the right jobs. The system has been described as “delegation just short of abdication.”(Lynch, 2015). Berkshire Hathaway does not have a separate international operation. Almost all of its portfolio of companies are based in the United States. It has minority holdings in Sanofi, a French pharmaceutical firm, and Munich Re, a re-insurance organization from Germany. In recent years Berkshire has