"Allowing people the freedom to pursue their own interests, within beneficial rules of just conduct, is the best and only sustainable way to promote societal progress."
"An organization must not only avoid unproductive tendencies, but continually strive to improve its ability to internalize and apply proper mental models. This requires the most difficult and painful of all changes: A change in the way we think."
"A positive reputation is built by behaving consistently with sound principles, creating real value, achieving compliance excellence and living up to commitments."
"Businesses that destroy value are detrimental to our lives. When businesses make unprofitable products, they are drawing resources away from higher-valued used, and when businesses waste resources, they prevent them from being beneficially used at all. In either case, a business with unattractive returns should be restructured, sold to a better owner or shut down."
"Business managers don’t want to come here because you have a former business manager on board."
"By instilling a work ethic in me at an early age, my father did me a big favor, although it didn’t seem like a favor back then. By the time I was eight, he made sure work occupied most of my spare time."
"Businesses’ visions must – and do – change."
"Constantly innovate and learn through experimental discovery."
"Creating superior value means generating greater value from the resources consumed than alternative uses."
"Developing a personal knowledge involves a personal transformation. It requires learning a new framework and mental models, and then using them to work out concrete problems. Personal knowledge is the result of integrating theory and practice."
"Do what you have a passion for and is most rewarding to you."
"Embrace change. Envision what could be, challenge the status quo, and drive creative destruction."
"For business to survive and prosper, it must create long-term value in society through principled behavior."
"He told me at an early age that he didn’t want ‘no country club bum’ as he facetiously put it. There was going to be no country club in my life as a boy. He started me out digging dandelions – when I was six years old – in most of my spare time. And I thought I’d soon get over that but it escalated from there." [His father]
"I am convinced the combination of our market based philosophy and how we practice it has been the primary source of our success."
"I developed two strong passions. The first was to help build a great company. The second was to identify and understand the principles that lead to prosperity and societal progress. After studying history, economics, philosophy, science psychology and other disciplines, I concluded that the two passions were strongly, indeed intimately related."
"If an evaluation of an employee’s performance only includes his or her contribution to current profits but not the effect on long-term profits and culture, we inadvertently encourage employees to work on the wrong things."
"In a return free market, with beneficial rules and property rights, the appropriate measure of the enterprise’s value creation is long-term profitability."
"In today’s world it is not sufficient to satisfy customers. A company’s reputation is critical to how it will be treated by others and to its long-term success."\
"I screw up a lot. Are you kidding me?" [On making mistakes]
"It is not a question of whether there should be self-interest; it is a question of how to channel that self-interest."
"It prompted my father to advise me to ‘never sue; the lawyers get a third, the government gets a third and you get your business destroyed.’ I’ve tried to follow his advice and have filed very few lawsuits. Unfortunately, he forgot to tell me how to keep from being sued."
"I understood the natural world operated according to fixed laws… I came to realize that there were, likewise, laws that govern human well-being."
"Just as central planning is a failure in running government, so it is at the level of the firm."
"Koch companies turn crude oil into products such as gasoline, and chemicals into fibers used in carpets and clothes. If we can make these products using fewer or less costly raw materials, the resources saved are available to satisfy other needs, enabling our profits to increase even when our prices decline."
"Measure profitability wherever practical."
"My father stressed the importance of humility as well as hard work. When I arrived in Wichita, his first words to me were: ‘I hope your first deal is a loser, otherwise you will think you’re a lot smarter than you are.’ He had nothing to worry about – I got us in plenty of losers."
"My father, who co-founded the company that would become Koch Industries. He exemplified much of what is centrally important to us: the value of hard work, integrity, humility and a lifelong dedication to learning."
"Our willingness to move quickly, absorb more risk and give better service enabled us to become the leading crude oil gathering company."
"Past performance does not guarantee future success."
"People benefit through profit and loss according to the value they create in society."
"Prosperity is only possible in a system where property rights are clearly and properly defined and protected, people are free to speak, exchange and contract, and prices are free to guide beneficial action."
"Prudent risk-taking should be encouraged by applying the concept of opportunity cost."
"Striving to comply with every law does not mean agreeing with every law."
"Successful entrepreneurs are not deterred by their lack of authority to control resources."
"Surprisingly, my father gave me almost complete freedom in the management of Koch Engineering. He told me I could do anything I want with it, short of selling it."
"The most difficult and painful of all changes: A change in the way we think."
"The process of discovery begins when we observe, often vaguely, a gap between what is and what could be."
"To build a culture of discovery, we must encourage, no discourage, the passionate pursuit of our own and others’ hunches."
"To guide activity correctly, we must measure what leads to results, not simply what is easy to measure."
"To the person with only a hammer and no understanding, every problem looks like a nail."
"True failures, are lost opportunities, the things you should have done but didn’t."
"Vision for us is not a one-time statement of goals and aspirations, but a dynamic concept, always evolving based on continual examination of how we create value for our customers and for society."
"We all ten to pursue our own interests, but in a true market economy we can only prosper by providing others with what they value."
"We don’t enter into partnerships without an exit mechanism."
"We must build a positive reputation based on reality, or others will create one for us based on speculation or animus and we won’t like what they create."
"We must measure what leads to results, not simply what is easy to measure."
"When everyone gets something for nothing, soon no one will have anything, because no one will be producing anything."
"You’ve got to be honest with people. You’ve got to challenge. You’ve got to give people honest feedback."