Lately I got to read quite some stuff on credentialism. I haven’t analyzed it enough to form an opinion though I firmly believe in my ability to influence, if not control, outcomes. Odds might be long, but they are rarely insuperable. The folklore of individual successes in business already confirms my thesis. But I do have a great respect for meritocracy – that advocates crowning anyone that truly deserves – than credentialism.
Way back in 2005, David W Boles referred it as phony-on-the-surface and irresistible-in-the-depths separation of people by paper (degrees).
How about validation by the market place? Something like a true blue hands-on guy that boxed every norm and broke every tradition that beat all others to the top on just raw nerve and imagination; I would love those types. They are so seeped in and when they start to tell, it hits you hard and shakes you up. You get your comeuppance.
But the system always demands more to keep out those it wishes to not welcome. As more and more people challenge the ivory tower power base with higher base degrees, the bar of perceived excellence gets higher and higher, just to keep the self-proclaimed majority elite in power; and that is accomplished by requiring more and more layers of bullshit to protect a process that is already overrun by pomposity and downward-nose-looking.
I see a lot of that in Investment banks and Private Equity funds. They recruit people that have expensive foreign degrees or MBAs with an added engineering background thrown in. A few years with Wall Street I-Banks, you are THE guy. Your level of awareness of local market systems, business laws, entrepreneurial culture and traditions hardly matter. You don’t need go far to seek why there are fewer multi-bagger exits in proportion to the sums invested. These are the guys that manufacture subprime crisis, invent alphabet soup like ABS, CDO, CLO that eventually screw up a vibrant market, bring out IPOs and later pressurize the issuer to withdraw when the sentiment thaws. When the market is at its peak, they open their treasure chests, buy minority stakes at mind boggling valuations. Later when it slumps and valuations look realistic, they shirk even from their underwriting obligations and do fewer deals. Small businesses like mine are beginning to feel the chill because of their frostiness. We drive deals to these icemen and they sleep over it for weeks leaving us to face clients with no firm answers.
Soon they too will get their comeuppance. As James Fallows asked, “If everyone has the tenure and security that come with professional status, who will take the risks?”