i am currently reading the black swan by nassim nicholas taleb and am getting some really interesting points out of it. as i read about taleb's upbringing and his philosophies on life, there is a really interesting point that he writes about that i thought i would share with everyone. he talks about getting a lot of advice in life, and while ignoring most of it, one point stuck with him.
one of his fellow wharton classmates explained to taleb that in looking for a career, make sure that it is "scalable". what he meant by this is to look for a profession where you are not paid by the hour and therefore are not subject to the limitations of the amount of your labour. this is a really interesting way to put careers in perspective and something that we should discuss a little further.
since sokanu is about helping you find your passion in life, and most passions are translated through careers, this point really piqued my interest. we have all heard of the terms "passive income", "making money while you sleep", etc... but i've never thought of a career as being "scalable". in business, we talk about building scalable businesses all the time.
a scalable business is one that can grow at an extremely rapid pace, with roughly a base input from the people working on the business. for example, for each user that facebook gains, they don't hire one person to manage that person. they don't have to put in eight hours of work to get 100 people to use farmville. they have built a scalable platform that grows at a very high rate relative to the amount of employees they have or the time they put in. compare this to a consulting business like deloitte or accenture or mckinsey. the reason they have 150,000+ employees each is because in consulting, for each client or project, you need to assign a team to it. they need to put in x hours and produce deliverables in order to get paid. thus, they are not considered a scalable business.
scalable vs non-scalable careers
so how does this apply to careers? what does taleb mean when he talks about choosing a scalable profession to work in? take some professions, such as being a doctor, dentist, consultant or personal trainer. these are professions that cannot be scaled, because there is a cap on the given number of patients or clients that you can see in a given period of time. in professions like these, no matter how hard you work or how highly you get paid, they are subject to gravity. your income depends on your continuous efforts more so than the quality of your decisions.
by contrast, scalable professions allow you to make more money without an equivalent increase in labor / time. as an example, an author writes a book one time and his effort is the (basically) the same whether he sells 500 or 500,000 copies. a hollywood actress need not show up at every screening of her movie to make money off it.
now, taleb's book is about black swan events, or highly improbable events that take place that can change history or your career. the reason that he does not want to have a non-scalable career is because it is not subject to a black swan event. one day cannot (under normal circumstances) produce significantly more income than that of the rest of your life. choosing a scalable career allows you to create a massive amount of wealth (or whatever your career's measurable metric is) very quickly at certain points. it is a risk/reward scenario. scalable careers have much more risk, yet an incredible reward.
this quote comes directly from the book and illustrates the difference between a scalable and non-scalable career.
a scalable profession is good only if you are successful; they are more competitive, produce monstrous inequalities, and are far more random with huge disparities between efforts and rewards -- a few can take a large share of the pie, leaving others out entirely at no fault of their own.
one category of profession is driven by the mediocre, the average, and the middle-of-the-road. in it, the mediocre is collectively consequential. the other has either giants or dwarves -- more precisely, a very small number of giants and a huge number of dwarves.
the problem with trying to build a scalable career is that it is a winner-take-all scenario. really good authors or athletes make a ton of money, but most of them make very little money at all. compare this to a dentist or doctor, where they make a very good living, and it is immediately comparable to other dentists or doctors.
obviously for most people pursuing a non-scalable career makes sense. especially when we read that taleb attributes these astronomical scalable successes to randomness and luck instead of hard work and persistence. what's your risk tolerance? are you looking for massive professional and financial success or would you be happy with a surer small slice of the total pie? do you see huge success as significantly dependent on circumstances out of your control?
by asking yourself these questions, you can determine whether or not you are in a position to pursue a scalable career. just remember, you may just be the next black swan.