A Warren Buffett Protégé on the Most Critical Thing She’s Learned About Turning Companies Around

Tracy Britt Cool learned a thing or two from Buffett. She shared some wisdom on stage at Fortune's MPW Next Gen conference.

When she landed a lunch meeting with Warren Buffett in 2009, Tracy Britt Cool arrived with a basket of fresh produce from her family farm. Charmed with the gesture, the Oracle of Omaha offered her a job. Cool has since parlayed the opportunity into a series of investing and operations roles at Berkshire Hathaway, where she learned some critical lessons about running companies—including the first thing to do with ones in trouble.

“The number one thing you have to start with in companies is the people. Do you have the right people? If not you have to find them, and create a culture and strategy with them,” Cool explained while speaking at Fortune’s Most Powerful Women Next Gen conference in Laguna Niguel, Calif.

Cool gained that insight while advising struggling Berkshire Hathaway companies where she had to replace CEOs. The key to choosing the right people, she said, was finding those with motivation but also a high level of integrity who would treat the company as their own.

Her advice echoed what Buffett himself told her when she asked to become CEO of one of Berkshire Hathaway’s companies, Pampered Chef, which at the time was struggling to adapt to the era of online commerce.

“He said ‘do what you think is best. Treat this company as if it’s the only business your family will own for the next 50 years and make decisions on that basis,” Cool said.

Her five-year stint at Pampered Chef has been a success as she helped the kitchen ware firm embrace technology to boost the business, including innovations like “virtual parties” where clients shop together on Facebook and Instagram.

Cool said a focus on people was a key to the turnaround at Pampered Chef, though she admitted choosing the right ones is never an easy task.

“Hiring, even on your best day, you don’t get right all the time,” she said, adding that a 60 or 70% success rate in hiring is the best she can hope for.

Now, Cool is beginning a new endeavor that will test her ability to build teams and create culture. After a decade at Berkshire Hathaway, she is leaving to build an investment firm of her own that will likewise acquire and support companies.

“I want to focus on owning companies for the long term…and taking them to the next level,” Cool said.

More must-read stories from Fortune’s MPW Next Gen Summit:

—Chanel Miller is more than “Emily Doe”
—The “blameless post mortem” and other techniques that spur innovation
—Career pivots are daunting. How three powerful women made them work
—Five tips for giving the perfect pitch, according to experts
—Exclusive: Enterprise’s Chrissy Taylor to become car rental giant’s CEO
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