My coauthors and I regularly discuss the concept of value versus cost. Not surprisingly, our mutual agreement on the concept can be summed up in a quote from the oracle of Omaha, Warren Buffet: “Price is what you pay. Value is what you get.” Also unsurprisingly, we don’t always agree with each other or other loved ones on specific cost versus value of different things. I think that reinforces the entire concept and our general philosophy.
For example, the three of us never conduct any form of accounting when we spend time together. There are a couple reasons for this. First, and most importantly, the value of our time together exceeds any cost we might incur while enjoying each other’s company. I honestly believe that if one of us were to encounter some sort of very significant financial difficulty, we would still do the same types of things, in the same types of places places, with the same frequency that we currently follow and none of us would blink an eye about any change in cost because the value of each other’s company and our conversations is not quantifiable in monetary currency. Secondly, we’ve all experienced the awkwardness and coldness of senior leaders who obviously put cost ahead of value and penny pinched their way to reputations as horrible leaders who failed to understand that authority is better earned than granted because of rank or position.
Multiple recent events have moved to me think even more deep;y about the concept of value versus cost. And if you didn’t get it from the previous two paragraphs, I’m not only speaking of financial cost. We “spend” more than money–time, energy, mental capacity, physical health, etc. I’ve seen it take a toll on people I love and others who I, and many others, need to be at full capacity to lead others. It’s sad when these people place too much value on money over time, health or relationships. It’s frustrating when I see people spend so much time on worry or doubt or other things over which they have no control. Warren Buffet would call that imbalance in cost versus value “junk bonds.”