Circle of competence
Work only inside the area you can genuinely evaluate, and know exactly where its edge is
Draw a line around what you actually understand, then refuse to act outside it. That is the whole method. How big the circle is matters far less than knowing where its edge sits, because the expensive mistakes come from wandering past it while still feeling confident. In practice it means passing on opportunities you cannot evaluate, however attractive they look, and widening the circle slowly, through study, rather than by assumption. Investors coined the phrase, but it gets applied just as often to hiring, career moves and any other decision where being wrong costs a lot.
Who backs it
Sorted by strength of stance
- Warren BuffettRecommends
Investor · Berkshire Hathaway chairman
Investors do not need to be experts on every company or even many, he wrote in the 1996 letter; they need to evaluate the ones inside their circle of competence. How big the circle is matters little. Knowing where its boundary lies, he says, is vital.
Source: Berkshire Hathaway: 1996 Chairman's Letter“You don't have to be an expert on every company, or even many. You only have to be able to evaluate companies within your circle of competence. The size of that circle is not very important; knowing its boundaries, however, is vital.”
Berkshire Hathaway: 1996 Chairman's Letter (opens in a new tab) · 28 Feb 1997
Aimed at the same thing
Other entries filed under focus.
- Protocol$$$Cheap: Roughly under $50, or under $15/month.
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Cold showers or ice baths used deliberately, usually a few minutes at a time
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Morning sunlight exposure
Bright outdoor light soon after waking, 5-30 minutes and no sunglasses
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Environment design
Change the room instead of relying on willpower
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Deep work blocks
Long, scheduled, distraction-free sessions on one cognitively hard task
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Time blocking
Give every hour of the workday a job before the day starts
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Digital declutter
A 30-day break from optional tech, then reintroduce deliberately
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Protocol entry · notes paraphrased from cited sources, quoted excerpts copied from the transcript they link to. Not medical advice. Not affiliated with, endorsed by, or reviewed by anyone listed. How this works.