I have a very good friend who is a real estate agent (prior to that, he was a public school teacher in a very impoverished area). When he became a real estate agent, he needed to choose a mentor who would guide him through his first five transactions.
Early on, my friend would often complain about his mentor. He didn’t have his act together, he was often late, he wasn’t that smart, etc.
Finally I asked him: “If this guy is such a loser, why did you pick him as your mentor?”
He said, “I felt sorry for him.”
That was when I sat him down. “This is the business world. You don’t pick the worst guy, you pick the best guy. Got it?”
Ever been to a pro tennis match? The crowd typically goes with whoever is losing. Or look at the UConn women’s basketball team. They are so dominant that they have generated a huge backlash.
And outside of sports, we’re always rooting for “the little guy,” “Main Street,” the disenfranchised, the underprivileged.
Screw the moral superiority of the underdog.
In the public sphere, you divert resources where there is need. The more need, the more resources. In the private sphere, you invest—in people, places, things. You allocate resources to things that are good. If somebody is winning, you bet on them to win more.
This is true for people, and it is true for departments and divisions, and it is true for entire companies, even countries.
Why is the underdog, the underdog? Why do we never carefully examine the actions of the underdog or assign any responsibility for his behavior? Can you imagine what the financial markets would be like if we tried to invest in the worst companies, instead of the best?
People Are Mentally Ill
So why is it that whenever people see a chart like this…