Yeah, I think all the posters above me have it right. Warren Buffett frequently emphasizes the importance of a good management team and corporate governance, but if the business is fundamentally broken, there’s not much a management team can do to revive it.
The real-life application of this is that frequently, investors will buy into a company with a new management team when they seemed to have good track records turning around prior businesses. Sometimes turnaround investing works, but more often than not people are either too early to the game (i.e. turnaround hasn’t shown signs of life yet and things get worse before they get better), or the turnaround just doesn’t happen…ever.
This is Buffett’s admonition that even a great captain frequently can’t save a sinking ship.