Page 19 - BusinessWest September 1, 2021

Expertise Is Under Attack
And When It Comes to Investing, That’s Not a Good Thing
By Jeff Liguori
Malcolm Gladwell, prolific non-fiction writer, journalist, and podcaster, has written extensively about mastering a
subject. In his book Outliers, Gladwell builds
subject. In an article he wrote for the New Yorker in 2013, he stated “nobody walks into an oper- ating room, straight out of a surgical rotation, and does world-class neurosurgery. And second — and more crucially for the theme of Outliers
gets a job in a major accounting firm where she likely works 50 hours per week. At night she stud- ies for her CPA exam. After three years, between college study, work, and prepping for the CPA, she has logged approximately 3,200 hours of work in a single subject: accounting.
And it is likely in a specific area, either audit or tax work. At 25 years of age, she is about one third of the way toward the 10,000-hour rule. This is precisely why a business or individual, with complex accounting issues, would not hire a young person with that level of experience. The analogy could be made for doctors, lawyers, or diesel mechanics as well.
In the investment field, the information needed to manage one’s money is widely avail- able. I’m not aware of a network that dedicates 24 hours to the practice of medicine. But turn on CNBC and it is a non-stop barrage of stock quotes and ideas, complete with bright colors, loud voices, and blinking lights. It thrives on our culture of excitement and reality TV.
Almost anyone with a decent Internet con- nection can invest his or her hard-earned funds. And early success reaffirms the dangerous bias that ‘I’m a talented investor.’ Until one morn-
Expertise
Continued on page 21
“There is nothing inherently wrong with the do-it-yourself trend. However, the intersection of social media, and the assault of information from a variety of sources (some questionable), has empowered many to shun traditional expertise that has been built upon years of study.”
— the amount of practice necessary for exceptional performance is so exten- sive that people who end up on top need help.” Today it seems that expertise is under attack. Whether it is climate science, economics, or healthcare. There are no hurdles to gathering infor- mation, factual or not, which has emboldened
upon the idea that it takes a person 10,000 hours to become a master, or expert, at some- thing.
The premise was originally put forth nearly 50 years ago by two academics, Herbert Simon and William Chase, and published in the Ameri- can Scientist specifically to address how one becomes an expert chess player. Gladwell elabo- rated on the idea by saying that an innate ability, or even exceptional intelligence, on a particular subject was not enough to excel or master that
many to opine on, and in some instances act on, areas for which they are not equipped. Being informed and questioning authority is not a bad thing. But acting as an expert has the potential for serious long-term damage.
Let’s break down the 10,000 hours concept. A young woman decides on majoring in account- ing her junior year in college. She has four semesters until graduation, where most of her classes are related to her major. Let’s assume that is a total of 100 hours of study. She graduates,
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