Causes of Leadership Failure – Expectation of Pay for What They “Know” Instead of What They Do With What They Know


What you know may NOT be worth moreThe world doesn’t pay for what people “know.” It pays for what they do, or induce others to do. – Napoleon Hill

[This is the third in a series discussing the causes of leadership failure presented by Napoleon Hill]

You’ve probably heard some variation of this story: A company is working hard to complete a production run for over 10,000 items to satisfy a multimillion dollar order when suddenly a key piece of equipment breaks down. Frantically, their techs try to get the machine back online, but have no success. So they call a specialist to come in and get the unit back up and running. After getting some details on the make and model, how long it’s been in operation, and some facts regarding what occurred leading to the breakdown, the specialist quotes a price of $5,000. The factory manager readily agrees to the terms. After all, there’s over $1M, not just in sales but also in profits, on the line!

The specialist shows up about a half hour later. He checks the logs, looks at the gauges, and crawls under the machine. Then he takes out a wrench and begins tapping the unit in select locations. After five minutes of his doing this, the unit starts up! The factory is back in business and can complete the production run in time to satisfy the order. The specialist was there a total of 15 minutes.

A few days later, the factory manager receives a bill for the agreed upon $5,000 – and he’s furious! “He wants this much for 15 minutes worth of work?! He’s out of his mind!” So the manager calls the specialist and says he wants a breakdown of exactly what the specialist provided to justify his $5,000 price tag. Five minutes after that call, a fax arrives from the specialist to the manager’s attention. It broke down the charge as follows:

  • One hour of labor:                                       $50.00
  • Knowing where to tap the unit                $4,950.00

Aside from getting you to read three paragraphs without even realizing it (and hopefully keeping you entertained), what does that story have to do with this particular cause of leadership failure? What lessons can we learn from it, and how can it help us avoid the pitfall Napoleon Hill describes above?

Use What You Know

Female manager

Do you feel passed over for a deserved promotion even though you “know more?”

Regardless of whether or not you think the specialist deserved his fee, one thing is certain: He used his knowledge to produce results. He wasn’t asking to simply be paid for what he knew, but for the results that knowledge produced when applied. Let’s contrast that with another type of person you’ve probably met in your professional life. We’ll call him Joe (no offense to all the successful leaders of the same name).

Joe’s been at his job over 20 years. In that time he’s received good performance reviews and as a result received pay increases slightly above cost-of-living. He’s also received the occasional modest bonus. Joe is on time and competent. Joe is also risk-averse. He doesn’t volunteer anything unless directly asked, and he’s as likely to follow orders even when he knows they’ll probably cause trouble down the line. Why? Because ‘it’s not his job’ to make those type of decisions, he reasons. Joe worked with all types of managers and has seen almost all aspects of the operation, and serves as a de facto team leader of a small group within his department, even while still answering to the department head and running every decision by his overseer no matter how small.

The company hires a new person, whom we’ll call Jane. Fresh out of school, she’s full of energy and wants to contribute. She works with different people in various areas, including Joe, who tried to share his views on keeping a low profile and only doing what you’re told. Jane has different ideas, however, and learns what she can from Joe, but remains ready to take on new tasks, always volunteering if it means an opportunity to showcase her skills. Jane quickly rises through the ranks and becomes a department head in three years. Eventually she takes over the position left by Joe’s former department leader, thus having Joe answer to her. As you can imagine, Joe isn’t very happy with this turn of events.

“Who does she think she is? She’s so wet behind the ears, she needs a towel! I know 10 times more than she does, and they’re giving her 6-figures, not including bonuses and perks, instead of me?! That’s just wrong.”

Poor Joe! The sad truth is, it’s not wrong for Jane to earn what she does. Although relatively new, Jane proved her value long before she received the compensation. Here are a few errors in Joe’s thinking to keep in mind:

  • He knows 10X more than Jane. That’s probably true – but unused knowledge is like potential energy. It has no real worth until it’s put into action.
  • Jane’s inexperience is a liability. While she lacks Joe’s years on the job, she’s filled her few short years with meaningful experiences that drastically increased her practical knowledge. That’s why she received the promotions never offered Joe.
  • Keeping under the radar is safe. Even if you’re looking to remain status quo, never challenging yourself to grow is dangerous. The world around us is constantly changing, and to simply maintain whatever level of success or advancement you currently have often requires developing new skills. So never taking on new challenges and forcing yourself to grow is the riskier course.
  • Not sharing your insight is safe. Even though the final decision rests on another’s shoulders, it’s in your best interests to speak up and share that knowledge. If a project tanks because of poor execution or poor planning, it’s not your responsibility. However, if you knew how to correct the problem and didn’t speak up, you bear some of the blame. Ultimately, a failed project affects everyone, not just the one in charge.

Joe fell victim to a sense of entitlement, the belief that he deserves compensation for what he knows. Sure, his years of service taught him much. However, as was eloquently stated by Napoleon Hill, the world pays you for what you do, or can induce others to do. It never pays you for what you know.

Don’t Fall Victim to the Trap

You’ll often see sites advertising, “Get paid for what you know!” Many, like Rewarder, Maven, and others, legitimately allow people with expertise the opportunity to share that knowledge with others for a fee. That’s a great resource; those sites provide a valuable service. That’s a far cry, however, from feeling you deserve a high five or even six-figure income simply because you’ve “been around” and “know a lot.” Business is like the Janet Jackson song; it always asks “what have you done for me lately?” So if you know a lot but haven’t done anything with it, don’t expect any compensation either.

If you really want to get paid for what you know, find ways to put what you know to good use. Establish yourself as the go-to resource in a particular field or niche market within that field. Once you’re respected as an expert and the word gets out, others will start seeking you out. You’ll get to share your knowledge with others, and eventually you’ll start getting paid for what you know and use in the service of others.

Have you ever found yourself victim to thinking you deserve payment for what you know rather than what you do? How did you overcome such thinking? What did you learn from the experience? Leave your thoughts in the Comments below.

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