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February 25, 2014

The Real Value of Experience

In most conversations Experience is an intangible, something that people acquire simply by doing “things” throughout their life.  If you’ve been doing a job for 25 years, you have 25 years worth of experience in that job.  Seems like a fairly inaccurate measure because if you spent the first 5 years getting the coffee surely that isn’t worth as much as the other 20 years.  It’s not worth zero experience, just not as much.

Experience should be looked at the way education is.  A Harvard MBA is more highly valued than a University of Phoenix MBA.  Both technically cover the same topics and course work but it’s generally looked at as clearly different.  Part of that is the selection process – higher acceptance standards usually means better graduates regardless of the actual education passed along.  Another part is the professors – Harvard has access to educators with more “experience” both teaching and working.  This adds up to mean the value gained from a Harvard MBA is greater than the value gained from the University of Phoenix MBA even though any given student does exactly the same work over exactly the same amount of time.

Apply that to the real estate industry now.  A 25 year broker who spent the first 20 years only dealing with local market deals less than 10,000 square feet is not going to have the same experience as a broker of 10 years who has dealt with 100,000 square foot deals in multiple countries.  It’s apples and oranges even though one has an extra 15 years of “experience.”

Experience is the actual work that people do.  This includes the network they build, the skills they learn, the problems they have solved and the mentoring they have received.  Collectively, these make up your experience.  It is not something time based other than from the fact that more time means you have had longer to collect it.  This is also why young workers with parents higher up in an industry advance quicker – they have the mentoring and network already received before they even start.  There’s nothing wrong with that, it’s the way the world works.

But that is how experience should be valued.  It’s not a matter of years.  1 year does not equal 1 experience.

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