Imagine there was a machine where you spoke and the machine delivered [maybe there already is]. For example, you say "iced tea" and presto, the machine emits a refreshing iced tea. You say "burger and fries" and you got it!
That, beloved friends, is what a well placed, sincere, compliment accomplishes. You say something positive to someone else and that very quality will emerge. You tell a person "You are really diligent" his self-identity becomes that he is someone who is diligent, so whenever he feels like slacking off a voice inside of himself says "You can't do that! You're diligent".
If you tell a person that he is kind, he starts seeing himself that way and the next time a kindness presents itself he rushes to perform it because that is who he is.
The more a person hears the same compliment, the more he becomes convinced that that is who he is.
So of course the lesson is to try to be very free with SINCERE compliments [fake insincere compliments can often be very hurtful]. You can help someone transform himself.
The truth is, that deep down inside we know our positive qualities but we often doubt them and hearing about it from an unbiased source confirms our innate feelings.