By a strong operating model I mean great operating margins or license fees or distribution capabilities that permit strong profits. It is possible to be a special situation without egregious profit margins. I have listed management last, but it is certainly not least. Here are four aspects that we consider imperative for management of special situations. Without the zeal and the drive for achieving a goal, you don t have management, you have caretakers Experience.
Enthusiasm is no substitute for experience.
In our recent search for the RedChip CEO of the year for 2000, it was startling that the contenders were typically in their 50s and their successful ventures were their second or third careers. Without focus, passion has a habit of expanding an operation s boundaries well beyond the scope of safety, and that often mires the company in details that can kill it. I ve witnessed a lot of special situations that have narrowly focused on one successful enterprise. I ve witnessed no conglomerates that have become special situations Bench depth. Asked how many employees have been with him since the beginning of Nike, Phil Knight responded One.