Generalists and specialists

So you have generalists and specialists. Generalists are fundamentally smart people who can do a variety of things. They take a look at a problem, take some time to understand the basics, and then go about solving it. They get bored easily, and move from problem to problem. Generally, they don’t dig deep but are well equipped enough to solve most problems.

Specialists, as the name suggests, dig deep into a particular problem. They are the kings of all they survey within their domain, and know every little trick in the book. However, they are usually unaware of the world outside of their wells, and suffer from the hammer-nail problem (to a man with a hammer, everything looks like a nail). They are also deeply insecure – for if their area of specialization gets invaded by generalists, they are likely to lose their livelihood. So, they are incentivized to build walls, and make it harder for generalists to invade. Generalists don’t have any such problem. Given their nature, if one fort gets invaded, they can soon go ransack another.

The world is dominated by specialists, and they continue to build walls around themselves. Artificial barriers to entry get created (such as “experience requirements”). While this keeps their domains safe, it leads to an increase in transaction costs and overall decrease in efficiency.

Take accounting as an example. In principle, it is not a particularly hard practice. What makes it particularly hard for aspiring accountants is the way you go about becoming an accountant. You need to pass an exam, set by the association of accountants, and then intern under an already qualified accountant (who pays you less than minimum wage) and pass another exam (again set by the association of accountants) in order to practice accounting. The exam and internship are rigorous enough that you need to devote two or more years of your life (full time) in trying to get your charter. All for a profession that is fundamentally fairly intuitive. So that the specialists’ turf is protected (of course the accountants have every incentive to keep the requirements to the charter prohibitively tough – for more chartered accountants would mean more competition and hence less margins).

Another example is in math papers. They are so formula and jargon ridden that it is prohibitively difficult for anyone who is not a full-time mathematician to make much sense of them. While some of the rigour may actually be justified, most of it is for the sake of preserving the mathematicians’ turf. The same applies in general to all peer-reviewed paper publication journals and conferences.

Social scientists are afraid of economists. Financial traders (from a commerce background) are afraid of engineers. In business schools, “marketing students” are afraid of “finance students” (more on this in another post). Their only defence is raising barriers, forming cliques and spewing jargon.