The Outsiders: Eight Unconventional CEOs and Their Radically Rational Blueprint for Success

by William N. Thorndike Jr.

Burke believed his “job was to create the free cash flow and Murphy’s was to spend it.”4 He exemplifies the central role played in this book by exceptionally strong COOs whose close oversight of operations allowed their CEO partners to focus on longer-term strategic and capital allocation issues.

“hire the best people you can and leave them alone.”

Murphy and Burke believed that even the smallest operating decisions, particularly those relating to head count, could have unforeseen long-term costs and needed to be watched constantly.

Teledyne, however, alone among 1960s-era conglomerates, steadfastly refused to pay dividends, believing them to be tax inefficient (dividends are taxed twice—once at the corporate level and again at the individual level).

Magness was among the first to fully recognize these attributes and made aggressive use of leverage to build his company, famously saying that it was “better to pay interest than taxes.”