Specialization Fails Business Leaders

Buffet and Munger

The division of labor leads to specialization leads to great efficiency, but probably not in the case of business leadership.

Charlie Munger has a fascinating perspective on educating business leaders that were excerpted on Farnam Street.

In my experience, history was the ideal course of study in preparing for business leadership.  It is, essentially, the study of causation, including analysis of all possible contributing factors, not just the engineering, psychological, technical, or cultural variable sets.

Of course, in business, studying history often takes the form of case studies.

Has over specialization and turf protection blinded business leaders to larger issues and insights that case studies of business success and failure might reveal?

How could analysts pushing collateralized debt obligations not see the house of cards they were building?  Were they missing the forest for the trees because their education and the culture they worked in were overly specialized?

Munger’s wisdom not only makes sense, it has earned him (and Buffet) some real dollars.