Are you the “Jack of all Trades”? There is a common misconception- “Jack of all Trades is the Master of None”. It may be true, but not always. Why can’t you Be the Jack of all Trades and become a successful investor?
Is there anything wrong to be a Jack of all Trades?
The one who knows something about everything is usually considered a loser. It is due to the fact that he is not a specialist in any particular field.
Our world treats specialized persons with more respect than a generalist.
Even the job market out there wants you to be a specialized person in some chosen fields for you to get an offer. Creeping in the idea of a secure job with income stability.
Beefing up deeper skills and becoming more and more specialized in that particular field to remain competitive in that specialization, is much more pathetic if you once lack interest in that field.
But, what is wrong if you have interests in many fields. Why should you be strictly constrained to a single specialization?
Yes, we do have personal finances to look after.
One day your employer may come to you and say
“Sorry, you are laid off”,
Or your company may declare bankruptcy. Sorry to say this.
But, life is full of surprises. I have to admit that.
If that’s the case, what are you going to do?
You have no option, but to look for another job.
But what if there is an industry-wide job cut or maybe a big disruption coming along.
You don’t have any option to resort.
Being a domain-specific master makes you completely dependent on that particular skill. It is not bad to have deep specialization.
But, if that particular skill is no longer relevant and goes void, you will remain obsolete or you have to think about a career alternative.
You may not be young enough to bear those changes.
For example.
If you have an uncommon medical condition you’ll be looking for a specialized doctor who does specialize in that particular medical condition.
Let’s see a medical emergency when the patient got admitted for a severe headache and the neurologist couldn’t identify the root cause of the medical condition.
The condition might be caused due to some other body parts. But what could a neurologist do? He has no idea…
He might have done exceptionally well in his specialization, but it only works if you know what is wrong with you and if there is only one thing wrong with you.
Of course, these kinds of situations might occur once in a while.
But who knows? A general Physician can solve this. (Generalists are specialist in their chosen field of generalization. They know something about every medical condition)
They might not be having deep knowledge about any neural therapy, but they can look the problem from a generalized view and can identify the issue.
Connecting the dots is what a good generalist can to exceptionally well.
Innovations Happens at the Intersections
Ok. Now the general physician found the issue. It is due to the neurological manifestation of a pulmonary disease.
Then what? We have to treat the condition.
Now, leave that to any medical expert who specializes in neurology, if that was the reason for the cardiac issue.
Problem Solved.
How this applies to Become Successful Investor?
Here are the some of the cases of concern. These may happen in a company where you invest.
- The company CEO start micro-managing every operation by directly involving the roles of COO or CFO.
To make it further intense, in some cases involving in direct sales, plant operations, etc. In many cases, it is driven by field-specific expertise.
For a small business with limited manpower resources, it may be a good approach for a CEO to keep things under control.
But as the business grows, complications dive in, and it is not that much easy to think about all at once.
If he continues to micromanage, it will have a negative impact on your business and employees.
A CEO has huge responsibilities to care for. Like, involved in key strategic decisions and planning activities, foreseeing the whole operations and planning to meet the future growth of the business.
- They start buying too many unrelated businesses and at one point it becomes difficult for them to manage. Or, they simply expand into uncharted territories of businesses.
Expanding in related verticals to improve the business is necessary, but overdoing it will act against the core objective of the business and make things uncontrollable.
You see, Historical events like Mergers and Acquisitions, expansions in many cases have personal motives and indirect incentives behind it.
Like an increase in remuneration in case of more acquisitions. Some CEO’s consider it as a symbol of pride, a toss in their ego. There were unethical and hidden benefits for the director or CEO.
Whatever the case may be.
As an investor, it should be worrying you…
Because it’s your money at stake.
If you want to diversify to reduce the concentration risk of your investments, you can do it by investing in various businesses separately. It is not necessary to have various businesses run by the same manager.
Your CEO might be a pucca manager with efficient entrepreneurial skills, but besides managing, he/ she should delegate most of the work.
Not following the hierarchy and doing activities without proper delegation will lead to misjudgments and business catastrophe.
Real Jack of all trades is those CEO’s who are doing exceptionally well in all areas of businesses.
They are leaders, having able managers to look after. They properly delegate responsibilities and motivate the managers. Moreover, they do it consistently without overdoing it.
To be a specialized generalist is a rare phenomenon.
They can solve issues and problems with generosity without being driven by a field-specific expertise.
He now looks at the problem from a wide angle, with no constraints from a view of a closed spectrum or a particular specialization.
If you happened to find one at the early stages, you might be more than just lucky enough to invest in their business.
Investor’s Attribute,
Being the Jack of all Trades by knowing about a lot of things and having a wide area of understanding will help an in connecting the dots.
Example:
Your knowledge in the aeronautical industry may hint you about a particular evolving technology that can probably solve the missing cases of flights from the RADAR.
This particular piece of information is a Eureka moment when you know about a not so famous public company testing an advanced flight tracking device.
If that company have able managers with good execution history, then it might be a potential turnaround investment for you.
Bottom Line:
Knowing and doing a lot more will definitely impact you as a person by deviating from any focussed specialization.
Though, this concept is not widely respected, in a dynamic world where things change too often and everything is interconnected, it does have its merits.
Not at all times, when CEO’s and directors overdo it.
You can perform reasonably well in investing by having a wide area of reasonable knowledge and understanding.
When it widens our view and aids in connecting the dots to have a better understanding of various investments out there, why can’t you generalize?
