# The Business of Expertise  ## Metadata - Author: [[David C. Baker]] - Full Title: The Business of Expertise - Category: #books ## Highlights - Pattern matching, or reverse pattern matching, is foundational to expertise. ([Location 186](https://readwise.io/to_kindle?action=open&asin=B07B7DFP1B&location=186)) - Tags: [[pink]] - Without pattern matching, there is no intelligence. Without similar scenarios, there is no pattern matching. Without a tight positioning, there are no similar scenarios. Time and time again, you’ll come back to this realization, and it will form the basis of everything you do. ([Location 211](https://readwise.io/to_kindle?action=open&asin=B07B7DFP1B&location=211)) - Tags: [[pink]] - Your only real control is to withhold your expertise. And although withholding expertise is the only leverage real experts have, it can be a powerful one, indeed. Let me show you how this relates to the second basic component of positioning: Good positioning makes you noninterchangeable. ([Location 238](https://readwise.io/to_kindle?action=open&asin=B07B7DFP1B&location=238)) - Tags: [[pink]] - If it’s easy to find a replacement for your expertise, you have no control (or power or choice) when you withhold it. ([Location 283](https://readwise.io/to_kindle?action=open&asin=B07B7DFP1B&location=283)) - Tags: [[pink]] - “Click here to schedule an introductory call.” Or at how eager they are to give away their expertise. “Contact us for a free assessment of your [fill in the blank].” All that is such bullshit and it devalues what you do. It stems from an acute lack of confidence. ([Location 302](https://readwise.io/to_kindle?action=open&asin=B07B7DFP1B&location=302)) - Tags: [[pink]] - Parental belief that their kids can do anything becomes a self-fulfilling prophecy that informs their later entrepreneurial pursuits. ([Location 320](https://readwise.io/to_kindle?action=open&asin=B07B7DFP1B&location=320)) - Tags: [[pink]] - Expertise blends knowledge with self-awareness of that knowledge. You’re smart, and you recognize that you’re smart. Otherwise, people don’t listen to you. ([Location 327](https://readwise.io/to_kindle?action=open&asin=B07B7DFP1B&location=327)) - Tags: [[pink]] - No matter how much I believed in my clients and their work, nothing but marketplace acceptance would confirm that in their own minds. ([Location 329](https://readwise.io/to_kindle?action=open&asin=B07B7DFP1B&location=329)) - Tags: [[pink]] - In a way, positioning is fake for a brief period of time. You’ve noticed just enough patterns to gain some credibility. Then you make the most of that driver’s permit to keep exploring, keep learning, and keep articulating insight. Eventually it feeds on itself and then you step into your expert clothes and really fill them out. ([Location 355](https://readwise.io/to_kindle?action=open&asin=B07B7DFP1B&location=355)) - Tags: [[pink]] - The first path is a deeply held belief or confidence about their value to clients. In spite of the fact that nearly everyone espouses this to be true, the evidence tells a different story (more on that is forthcoming). ([Location 361](https://readwise.io/to_kindle?action=open&asin=B07B7DFP1B&location=361)) - Tags: [[pink]] - The second path is benefiting from the many opportunities that come their way, either accidentally (being in the right place at the right time), or intentionally (they’re really good at marketing their services). ([Location 365](https://readwise.io/to_kindle?action=open&asin=B07B7DFP1B&location=365)) - Tags: [[pink]] - The right size is always this: slightly smaller than the amount of opportunity within reach. ([Location 406](https://readwise.io/to_kindle?action=open&asin=B07B7DFP1B&location=406)) - Tags: [[pink]] - A hobby costs you money. A job trades expertise for a predictable income. An enterprise is a separate entity on its own, bigger than a person, contributing profit on top of the monetary exchange associated with the job. ([Location 478](https://readwise.io/to_kindle?action=open&asin=B07B7DFP1B&location=478)) - Tags: [[pink]] - If you’re open to the exercise of pattern matching, always start with yourself. Where have you consistently failed or thrived? What inputs led to better decisions? What happened when you pulled these levers in these combinations? ([Location 546](https://readwise.io/to_kindle?action=open&asin=B07B7DFP1B&location=546)) - Tags: [[pink]] - You should always have a list with getting to “know” topics on it. Quit protecting what you learned in the past and spend that energy on new things right now. ([Location 628](https://readwise.io/to_kindle?action=open&asin=B07B7DFP1B&location=628)) - Tags: [[pink]] - The idea that you should follow your heart and that success will find you is a fool’s errand. ([Location 717](https://readwise.io/to_kindle?action=open&asin=B07B7DFP1B&location=717)) - Tags: [[pink]] - But do some research and planning first. Then save up some money so that you’ll have a cushion without having to compromise. Fake it a little at first — we all do — but get smarter every day. Build a business that delivers the value that others enjoy paying you for. Enjoy your work and be disciplined about the parts that you don’t. Ensure a profitable enterprise to fund your excessive habits. Follow your heart, but follow your brain, too. ([Location 720](https://readwise.io/to_kindle?action=open&asin=B07B7DFP1B&location=720)) - Tags: [[pink]] - Values are the non-negotiables in our belief system that would never change regardless of the setting or external pressures. They are best discerned by observing our actions, which reflect our character. Values stem from who we are. They would show up in whatever sort of business we were running. Purpose is the reason why our particular organization exists. (Later in life, the same values might lead to a different purpose, mediated through a different business.) Mission is how the organization will achieve the purpose for our existence, based on the values that we share. (Any given purpose could lead to multiple missions. Your mission is how you choose to implement your purpose.) Vision is the destination. It’s what the end result will look like if my values lead to a certain purpose whose mission my organization exists to fulfill. It connects purpose with impact. (This is the huge, wide-ranging vision that drives you forward. It’s aspirational in nature.) ([Location 734](https://readwise.io/to_kindle?action=open&asin=B07B7DFP1B&location=734)) - Tags: [[pink]] - Stephanie’s values are built around helping others. She’s a confident, articulate giver and not a taker. She is a former practicing architect — a talented one — but she struggled to make smart business decisions and decided instead to help her peers. Addleback’s purpose is to help leading architects build strong architectural practices. Addleback’s mission is to provide critical insight, applicable tools, and transparent peer learning environments to equip architects to succeed. Addleback’s vision is that every expert architect would be led by an engaged managing partner doing impactful work in a profitable environment for right-fit clients. ([Location 749](https://readwise.io/to_kindle?action=open&asin=B07B7DFP1B&location=749)) - Tags: [[pink]] - Let me suggest the order that might work best over the lifetime of a business, in descending order of importance: Make money. Do effective work. Build a strong culture. Enjoy your work. ([Location 764](https://readwise.io/to_kindle?action=open&asin=B07B7DFP1B&location=764)) - Tags: [[pink]] - money is the currency of respect, and the customer of an expert treats the advice more seriously if it comes with a hefty bill. So charge a lot for them or charge a lot for yourself, but whatever you do, charge a lot. ([Location 775](https://readwise.io/to_kindle?action=open&asin=B07B7DFP1B&location=775)) - Tags: [[pink]] - As you think about the title of this chapter — The Why of Expertise — I think you’ll be well served by trying to achieve these three goals all the time: profit, effectiveness, and culture. Any one of them could be trumped or put on pause for a greater good, but the big picture is comprised of consistently meeting those three goals. And if you can enjoy your work building your business, you have a pretty ideal job and can tip your hat to the gods. ([Location 795](https://readwise.io/to_kindle?action=open&asin=B07B7DFP1B&location=795)) - Tags: [[pink]] - And believe me, you will love what you do because competence is its own reward. ([Location 818](https://readwise.io/to_kindle?action=open&asin=B07B7DFP1B&location=818)) - Tags: [[pink]] - All this to say that expertise is about knowing, and knowing can be turned into lots of other good things. ([Location 825](https://readwise.io/to_kindle?action=open&asin=B07B7DFP1B&location=825)) - Tags: [[pink]] - After looking at 1,340 examples of successful experts, the only consistent trait was that they were risk-takers. That means that they were wrong a lot — but that they were usually right about the important things. ([Location 845](https://readwise.io/to_kindle?action=open&asin=B07B7DFP1B&location=845)) - Tags: [[pink]] - Life isn’t about finding yourself but about creating yourself. That process of creation is about understanding yourself and then defining a competence on top of that, and the building process never stops. ([Location 978](https://readwise.io/to_kindle?action=open&asin=B07B7DFP1B&location=978)) - Tags: [[pink]] - It feels to me like every transition through this competence and creation and competence again is like crossing over into ever-increasing personal strengths, finding something new. Every one of those cycles that you go through helps you find one additional satellite so that your location in the world is just that much more precise; you know exactly what impact you are having. Having interviewed thousands of experts over the years, it seems like they typically go through four or five cycles. They do something. They’re very competent. Then they cross over to something else, like a Venn diagram, that has some relevance to what they were doing but it’s something different and really beautiful. They find new patterns. ([Location 1003](https://readwise.io/to_kindle?action=open&asin=B07B7DFP1B&location=1003)) - Tags: [[pink]] - That’s part of having an impact on your world: making decisions and not simply reacting to what the world wants from you. ([Location 1033](https://readwise.io/to_kindle?action=open&asin=B07B7DFP1B&location=1033)) - Tags: [[pink]] - A combination of those four reasons explains why so many experts define their sphere of influence so broadly: lack of objectivity, the struggle to say no, the notion that marketing is beneath them, and distraction. ([Location 1101](https://readwise.io/to_kindle?action=open&asin=B07B7DFP1B&location=1101)) - Tags: [[pink]] - In my consulting practice, I advise that a creative firm should not spend more than 6% of their fee base on burdened facility costs: monthly lease, utilities, taxes, insurance, cleaning, repairs, and security. ([Location 1154](https://readwise.io/to_kindle?action=open&asin=B07B7DFP1B&location=1154)) - Tags: [[pink]] - How are you going to pull off this crossbar of broader relevance and the deeper expertise that clients really want to pay for? The answer is to focus your business life on deep SME (subject matter expertise) while maintaining a varied, sponge-like, interesting personal life that puts that SME into context. ([Location 1159](https://readwise.io/to_kindle?action=open&asin=B07B7DFP1B&location=1159)) - Tags: [[pink]] - There’s a time and a place for confidence, but your army (confidence) can’t march too far forward of your supply lines (expertise) or you’ll be caught without what you’ll need in order to win the war. ([Location 1208](https://readwise.io/to_kindle?action=open&asin=B07B7DFP1B&location=1208)) - Tags: [[pink]] - Think of the options as a spectrum, with the right side depicting a completely undifferentiated firm (I’m an accountant) and the left side depicting the most focused firm you could imagine (I’m an accountant who works with U.S.-based multi-location casual dining brands). ([Location 1218](https://readwise.io/to_kindle?action=open&asin=B07B7DFP1B&location=1218)) - Tags: [[pink]] - That’s the first reason why you stop and regroup: running out of opportunity. ([Location 1228](https://readwise.io/to_kindle?action=open&asin=B07B7DFP1B&location=1228)) - Tags: [[pink]] - The second reason you might stop moving from right to left along this spectrum is lack of courage, or perhaps interest, on your part. ([Location 1229](https://readwise.io/to_kindle?action=open&asin=B07B7DFP1B&location=1229)) - Tags: [[pink]] - So those are the four classic advantages of vertical expertise: It’s easy to find your prospective clients. Your best clients take you with them to their next job. The word spreads organically as clients and prospects mingle around vertical water coolers. Vertically pinned expertise is more highly compensated. By extension, then, we can flip those around and see the four challenges of horizontal expertise: It’s more difficult to find your prospective clients. Your best clients don’t necessarily need you at the next step on their career path. Word of your work doesn’t have as many natural paths to grow. The expertise isn’t valued quite as highly. ([Location 1311](https://readwise.io/to_kindle?action=open&asin=B07B7DFP1B&location=1311)) - Tags: [[pink]] - One client and you’re learning. Two similar clients and you have a conflict. Three similar clients and you’re an expert. Four similar clients and there are no conflicts. ([Location 1358](https://readwise.io/to_kindle?action=open&asin=B07B7DFP1B&location=1358)) - Tags: [[pink]] - In review, these are the four classic advantages of horizontal expertise: More variety as you apply your work to different verticals. Few significant conflicts of interest. Greater immunity from an economic downturn in a particular vertical. Work of the size that you can handle, from larger and more sophisticated clients. By extension, we can flip these around, too, and see the four challenges of vertically-positioned expertise: Less variety. Will need to manage a thoughtful conflict strategy. Could rise and fall with the industry you serve. Assumption that you can be their full-service expert, which will limit the size of companies for which you can honestly be just that. ([Location 1382](https://readwise.io/to_kindle?action=open&asin=B07B7DFP1B&location=1382)) - Tags: [[pink]] - Positioning must be declared publicly. Positioning should be semi-permanent. Positioning’s importance is inversely related to the size of your firm. Positioning’s importance is inversely related to the remoteness of your geographic center. Positioning is ideally narrowed to a single focus. Positioning is built on your expertise and not your implementation. ([Location 1541](https://readwise.io/to_kindle?action=open&asin=B07B7DFP1B&location=1541)) - Tags: [[pink]] - The positioning of your expertise is built almost exclusively on your strategy and not your implementation work. ([Location 1650](https://readwise.io/to_kindle?action=open&asin=B07B7DFP1B&location=1650)) - Tags: [[pink]] - As we noted above, a very diverse and interesting personal life outside work will keep your expertise grounded within a larger context, but if you expect clients to fund the arts (your learning experiences), it’s not honest work. ([Location 1851](https://readwise.io/to_kindle?action=open&asin=B07B7DFP1B&location=1851)) - Tags: [[pink]] - Remember that no good answer starts without a good question. If you aren’t sure what to say next, just quit talking and start asking better questions. ([Location 1931](https://readwise.io/to_kindle?action=open&asin=B07B7DFP1B&location=1931)) - Tags: [[pink]] - Early questions are a test; later questions are truly exploratory. ([Location 1935](https://readwise.io/to_kindle?action=open&asin=B07B7DFP1B&location=1935)) - Tags: [[pink]] - Develop all your insightful observations into a system. Price it as a diagnostic package, and now you have a real process that is likely different from all the “me too” processes that have spread like weeds on websites. ([Location 2071](https://readwise.io/to_kindle?action=open&asin=B07B7DFP1B&location=2071)) - Tags: [[pink]] - If you aren’t consistently helping your clients see things in new, helpful ways, you are not consistently relevant. ([Location 2099](https://readwise.io/to_kindle?action=open&asin=B07B7DFP1B&location=2099)) - Tags: [[pink]]