Book Review: The Story of Success by Malcolm Gladwell

The book “Outliers” explores the underlying factors of success stories to find commonalities, across fields. The author Malcolm Gladwell goes beyond the obvious ones such as ability, hard work, and intelligence, where a star is usually born in modest circumstances and fights her way to greatness by virtue of her own brilliance and efforts. He argues individuals who achieve outstanding success referred to as “Outliers”, are not just the result of individual/isolated persistent efforts and intelligence alone.

He makes case for a combination of factors particularly – 1) extraordinary opportunities and 2) cultural legacies that play a tremendous role in one’s success. While I am in total agreement with the intelligence and ability, I have not consciously acknowledged and appreciated the opportunity and cultural factors. It suggests that success takes into account where you are from in addition to who you are. According to him, this cannot be the rule in itself, but it can definitely explain some of the success stories.

The famous “10,000-hour rule” phrase from the book emphasizes that even the highly talented Fab Four Beatles or Bill Gates had the special benefit of rigorous practice/ access before they became world-famous and achieve professional mastery in respective fields providing them the “Accumulative Advantage”. While innate talent is real, the achievement is talent plus preparation. He lays emphasis on the second aspect of cultural legacy as well- the ancestors, the community, and the era you are born and brought up in have a major impact on the path to success. This is easily validated in the case of super-investors like Warren Buffet who was born in the Great Depression-era of 1930 and started investing in the 1950s.

The Key Takeaways from the book

Persistent hard work, the influence of the environment & culture coupled with the external opportunities are presented as fundamental determinants of success in the book. I can draw parallels in the world of investing in the context of both successful businesses and investing.

In the case of companies, opportunity and cultural legacy can go far to explain the success of the companies than the obvious factors of right strategy/ management, etc. It’s evident in my assessment of several companies too that businesses cannot be built overnight and require years of intense focus to achieve greatness and is significantly influenced by the culture of the organization.  And some businesses invariably benefit from the timing and opportunities that are otherwise non-existent which could be a first-mover advantage or timely technological breakthrough. This reinforces my idea to dwell more on the company’s legacy, longevity, and its undeterred focus through tough times to understand the factors underpinning the success. Also, I have personally found it easier said than done to stick to a particular investing style. This indeed requires sustained focus over a long time on the investment philosophy and not to get carried through cycles which in some way is corroborated by the 10,000-hour rule in the book.

– Repost from UTI Mutual Fund