The English word, “Appraise,” originates from 15th century Middle English. It is an adaptation of the French word, “Apriser,” and the Latin, “Appretiare” or “Adpretium” It translates in all three languages as: (1) to set a price on, or (2) to value.
Simply put, to appraise is to price or value someone or something.
The earliest known real estate appraisals date back to ancient Mesopotamia and Egypt, around 3000 BC. Ancient clay tablets and papyrus scrolls uncovered reveal that scribes in these civilizations formerly inspected, measured, and valued land and buildings. This information was used to record ownership, define land boundaries, document the sale or exchange of property, and to assess taxes.
The Mesopotamians implemented basic value exchanges for continuity purposes. Ancient Egypt determined tax obligations based on soil quality and proximity to the Nile. Each culture established its own rules and guidelines for appraisals.
One of the earliest references of real estate appraisals in the United States dates back to 1626 when the Dutch West India Company assigned experts to value land in New Amsterdam, now know as New York City, for tax purposes. Like Ancient Egypt, the tax base was determined in part by the size of the land parcel, soil quality, and proximity to water.
Economists like Adam Smith, David Ricardo, and Alfred Marshall all shaped modern appraisal theory, implementing standards resulting in more uniform valuations of land and buildings. In 1932, the American Institute of Real Estate Appraisers was established to standardize education and ethics. By 1936, the Federal Housing Administration introduced the first centralized underwriting manual to formalize market-based valuations in the U.S.
But appraisals aren’t just limited to land and buildings.
The concept of evaluating workplace performance has its roots in 19th century Scotland. In the early 1800s, textile manufacturer Robert Owen utilized a “silent monitor” system in his New Lanark mills. Colored blocks, white for excellent, yellow for good, blue for acceptable, and black for poor, were used to appraise and distinguish daily worker performance.
Today, workplace appraisals are not only used to benchmark performance, but to determine placement, training, and compensation. Appraisals are also used to identify staffing needs, maintain quality control, and to provide feedback to employees and staff.
In the 1960s, Magda Arnold fundamentally shifted psychology away from rigid behaviorism, the belief that all human actions are purely physical responses to environmental stimuli, toward what today is known as Intuitive Appraisal. Arnold argued that the initial appraisal of any stimuli is immediate and intuitive, occurring in the primal regions of our brains, the seat of emotions, without conscious thought.
Further studies by Richard Lazarus added credence to Arnold’s work, reinforcing that the role of emotions in the brain’s appraisal process is dynamic. He went on to demonstrate that as situations change or we gather more information, we continually reappraise the event. This, in turn, may alter our emotional and physical response.
The expansion of appraisals to include personal property and fine art helped to establish a fair market value for taxation, estate distribution, and insurance. In the mid-1700s, auctioneers began to increasingly rely on appraisals to set fair opening bids and reserves. By early 1800s, this practice was commonplace in European auction houses like Southeby’s and Christie’s.
Today, we use certified appraisals not only for real estate and mortgages, but to insure high-value items. These same appraisals dictate the value of assets in wills, trusts, and probate cases. This ensures equitable distribution and proper tax reporting.
So why the history lesson on appraisals? I’m glad you asked, because there is one very specific appraisal I want to focus on for the remainder of this lesson. It’s an appraisal that directly affects you, your livelihood, and the level of success you experience in life, depending on who is conducting the valuation.
One of my early mentors was Dan Kennedy, a man I often refer to as the Godfather of Direct Response Marketing. As a former member of the GKIC Inner Circle, I was privileged to receive a monthly “No B.S.” Newsletter from Dan Kennedy, full of insightful tips and tools to expand your reach and influence. I also received Audio CDs of Dan’s appearances at industry events, as well as regular teleconferences.
I was listening to one of Dan’s CDs on a trip to Missouri a couple of weeks back, and he made a statement that I’ve heard him say many times, but that day it spoke to me in a new and powerful way, inspiring this lesson on appraisals. Here’s what Dan said:
“The marketplace takes you at your own appraisal. If you don’t have the guts to ask for what you’re worth, the market simply accepts you at lesser value.”
What are you worth? What’s your value? Who’s assessing your life? Who’s setting the valuation on your life? Is it you, or someone else?
If it’s you, are you truly asking for what you’re worth? Because if you’re not, the marketplace will gladly offer you less for your expertise, experience, and brilliance.
For the next few moments, I want to share with you ten observations from Dan Kennedy’s powerful statement you can use to make an honest, candid valuation of your worth, your value, in the marketplace. I believe that, over the next few moments, you’re going to discover that you’re worth far more than you may believe.
It’s time for a fresh appraisal.
The first observation comes in the form of a question. Who defines your value? For centuries, civilizations have appraised land, employers have appraised employees, auction houses have appraised art, and banks have appraised property. The most important appraisal is the one you make of yourself.
What do you believe you’re truly worth?
The first leadership principle from my book, Black Belt Leadership 101, is this: “You cannot achieve what you do not believe.” Your valuation, the appraisal of your worth, is a byproduct of your belief system. Your belief serves as an anchor for your self-worth. It’s subject to the value you place on yourself, based on what you believe to be true about you.
Without a strong belief in your own value and worth, you may simply accept the lesser value others choose to put on you, limiting what you can say, do, and become in the process. If you willfully accept the lesser opinion of others, you cheapen your value in your own thoughts, and you limit your potential.
Do you want to be worth more or less? Who’s establishing that valuation?
Secondly, Dan Kennedy powerfully noted that the market takes you at your own appraisal. Henry Ford famously said, “Whether you think you can, or think you can’t, you’re right.”
I recently finished reading a powerful book by Dr. David Hawkins, “Power vs. Force.” Dr. Hawkins points out that as we elevate the level of our consciousness, we begin to elevate how we see ourselves. We uncover talents, skills, and abilities that were latent, but waiting to be discovered, developed, and deployed. When this happens, the value we place on ourselves elevates as well.
Remember, as you think, you say, do and become. The more and better you think, the more and better you say, do, and become. But once you stop thinking, you stop saying, doing, and becoming any more than you already are.
The third observation from Dan’s powerful quote is the danger of borrowed pricing. In real estate, appraisers use comparable sales (comps) to determine a property’s value by comparing it to similar homes in the same area that recently sold. This establishes a baseline, but one that is set not by you, but by borrowing from the value of others.
When I’m working with an organization to help them launch a new product or service, the inevitable valuation conversation always comes up. Most organizations want to research what their competitors are charging, determining a range of pricing. From there, the conversation shifts to whether they want to price themselves in the middle, near the top (but not the most expensive), or near the bottom (but not the cheapest).
It’s the wrong conversation. If you’re delivering substantially more value than your peers in the marketplace, why would you discount that? People want to do business with people who can uniquely help them achieve a goal or objective or overcome a need or a concern. If you can do that better than anyone else, there’s great value in that.
What if you simply told your clients, “We charge more because we’re better,” and then you went on to explain to them what that looks like, how they uniquely benefit, and the outcome they can expect as a result of working with you?
You can only do that when you’re setting your own valuation.
The fourth point I would make, building on the prior point, is that price is not the same as value. Outcome is the value. People are willing to pay more when the value of the outcome exceeds the price requested. Don’t believe me? I’m one of the featured speakers at a conference in Dallas next week. A general admission ticket is $249 for a 3-day event. An “All In” ticket that includes an additional year of group coaching, access to four additional events this year, preferred seating, specialty dining, and a VIP experience is going for $8,000.
There are still a number of general admission tickets available, but only 5 “All In” tickets left.
Remember, people don’t pay premium prices for time, labor, information, or effort. They pay premium prices for outcomes, certainty, speed, trust, access, expertise, transformation, and reduced risk. Price is not the same as value. Outcome is the value.
The fifth takeaway is that the inner appraisal comes first. What was the first leadership principle from my book, Black Belt Leadership 101? “You cannot achieve what you do not believe.” Before the marketplace will accept the value you place on yourself, you’ve first got to believe your appraisal is valid and accept this as truth.
Psychologist Albert Bandura is renowned for developing the Social Learning Theory and the concept of self-efficacy. This is a person’s belief in their own ability to get things done and reach their goals. When you have high self-efficacy, you trust yourself to navigate obstacles to success, as you see them as challenges to master and overcome, not a threat to avoid.
When you believe in yourself, you possess not only the confidence to accomplish your goals, but the ability to overcome obstacles and influence outcomes in your favor, leading to more and greater levels of personal and professional success.
Until you see and affirm the true value in yourself, others are unwilling to accept and pay it.
Sixth, you must escape the race to the bottom. When your only differentiator is price, you’re trapped in a race to the bottom where margins erode and your product or service becomes a commodity. When you shift the conversation to focus on expertise, trust, and proven results, you now elevate yourself from being just another option to consider to becoming an indispensable partner.
For example, when I’m working with sales professionals, I often shift their focus away from selling hours or delivering a product or a service to selling a proprietary methodology. As previously noted, you’re offering an outcome. The product or service you’re offering are simply tools to help you achieve what the other person wants or needs.
People don’t buy a hammer and a box of nails. They buy a solution to getting the pictures hung in their home. People don’t buy life insurance. They are buying replacement income for those they would leave behind if they died prematurely.
People are willing to pay a premium for a clear, trusted roadmap that guarantees results. How you package your skills, talent, expertise, and experience into a proven process that delivers results matters.
The seventh observation comes from a quote from Ray Kroc, the Braintrust behind the global McDonald’s empire. His aggressive, systems-driven business philosophy was built around relentlessly repeating, but constantly refining, a good simple system so the competition was always chasing a moving target. Essentially, reinvent yourself faster than others can copy.
Assets can either appreciate or depreciate. Appreciating assets are always worth more than depreciating assets. You want to be an appreciating asset. This requires that you become a lifelong student of learning. To appreciate yourself, you must continually be upleveling the value you bring to the marketplace.
Yesterday’s expertise becomes today’s commodity unless you keep moving. What got you to where you are today won’t get you to where you want and need to be tomorrow. You’ve got to daily become a better version of who you are and what you do.
This leads to the next observation. Movement changes the value of the appraisal. Albert Einstein famously said, “Nothing happens until something moves.” The status quo has great power. It’s mission, to keep you where you are, as you are, unchanged. Einstein’s quote highlights a fundamental truth about both physics and personal growth. Whether you’re referring to the physical vibration of particles in the universe or taking the first step on a personal growth goal, no change can occur without initiating movement.
Zig Ziglar said it well, “You don’t have to be great to start, but you have to start to be great.”
The ninth observation is practical and direct. You must have the courage to state your terms. Successful people don’t merely accept the terms of others; they define them. They don’t do this arrogantly, but they do so clearly. Their confidence in themselves and their ability humbly says, “This is who I am. This is what I do. These are the results I help create. This is what I require in exchange.”
This is the Black Belt Leadership principle of Boldness.
The final observation is a return to the first. You must continually re-appraise yourself. If you’re an appreciating asset, your value grows over time. You should regularly reassess your gifts, talent, ability, experience, expertise, results, and your future potential and factor these into your self-appraisal. Don’t sell yourself for less than you’re worth.
The marketplace will eventually place a value on you, a number they are willing to pay. The question is whether it will be based on your fear, your comparison, or your silence in declaring your true value and worth. Or, your value will be based on your growth, your results, and your honest appraisal of yourself.
Self-appraisal isn’t arrogance. It is stewardship. It’s a disciplined act of recognizing what’s been placed in your hands, developing it with excellence, and presenting it to the marketplace with courage, conviction, and clarity.
This is what Black Belt Leaders do!
