Morgan Housel, a writer and former columnist with The Wall Street Journal and Motley Fool, is currently a partner at The Collaborative Fund. This post initially appeared on that website.
My friend Patrick O'Shaughnessy is a professional investor with a book club. A while ago he sent his club an email with his favourite books of the year. "Consistent with my belief that it is more productive to read around one's field than in one's field, there are no investing books on this list," it read.
This is such a powerful concept.
Most of us spend too much time in the bubble of our own professions, unaware of how much there is to learn from other fields. A lot of jobs fall under the category of “trying to figure out what other people want,” so many ideas from one field transfer to another.
Here are a few takeaways from various professions that are relevant to business and investing.
Poet: Quality does not scale with the number of inputs. You can make a more powerful point in 10 words than you can 10,000.
Doctor: The cumulative effects of small daily habits – both good and bad – add up to something enormous over time.
Politician: The winner is not always the most accurate, but the most persuasive.
Lawyer: No argument is ever 100% air tight.
Pilot: Ninety percent of the job is uneventful to the point of automation; ten percent of the job is terrifying and requires complex skills and a flawlessly calm demeanor.
Accountant: You can lie more easily with numbers than you can with words. People associate numbers with math, and math with facts, leading them to be more gullible with numbers than they are when confronted with words alone.
Gambler: Bet when others think the odds of success are low (that’s where there’s big payoffs) but be able to survive when those other people are right most of the time.
Dietician: Solutions to problems can be shockingly simple; Getting people to adhere to simple solutions can be shockingly difficult.
Engineer: Break down a complex problem into its simplest series of steps.
Therapist: What people present to the world is a tiny fraction of what’s going on inside their head.
Biologist: All environments change, and the best protection against those changes is the ability to adapt.
Pediatrician: You don’t know how important communication is until your customers are incapable of talking you.
Banker: The combination of leverage and a momentum can make ordinary people look extraordinarily talented.
Psychologist: People are amazingly good at convincing themselves of things that are untrue but justify unpleasant parts of their lives.
Financial advisor: People think they want expert advice, but what they really want is advice that sounds like something an expert would say.
Cop: By the time people get caught they’ve probably committed a crime dozens, maybe hundreds, of times. The bad behavior you hear about is a small fraction of the bad behavior that occurs.
Cab driver: Nothing teaches the concept customer acquisition cost better than driving across town to pick someone up for a $4 fare.
Construction worker: You cannot argue with physics.
Waiter: Incentives are powerful when your pay depends on the ability to satisfy customers this moment.
Customer service rep: Patience often stops short of the ability to realize how difficult other people’s jobs are.
