The Most Important Power in Business

Last week I took Warren Buffet to task for his ill-conceived philosophy on making mistakes. Today, I'm going to highlight his genius.

While being interviewed by the Financial Crisis committee, Buffet commented, That good management is unnecessary to a successful company. So what is important:

"The single most important decision in evaluating a business is pricing power."

While I think Buffet is overstating his comments on management, I completely agree with his sentiment about pricing power. The biggest challenge for businesses following The Great Recession is recapturing pricing power - if they ever had it.

B2B companies that don't have clear, distinct value propositions that stand out in a meaningful way DO NOT have pricing power.

As I've written before, the single best way to capture the pricing power that Buffet is talking about is to be indispensable to your core market.