Principles are ways of successfully dealing with reality to get what you want out of life.
Ray Dalio, one of the world’s most successful investors and entrepreneurs, cites principles as his key to success.
In 1975, Ray Dalio founded Bridgewater Associates, out of his two-bedroom apartment in New York City. Over forty years later, Bridgewater has grown into the largest hedge fund in the world and the fifth most important private company in the United States (according to Fortune magazine), and Dalio himself has been named to TIME’s list of the 100 most influential people in the world. Along the way Dalio discovered unique principles that have led to his and Bridgewater’s unique success. It is these principles, and not anything special about Dalio, that he believes are the reason behind whatever success he has had. He is now at a stage in his life that he wants to pass these principles along to others for them to judge for themselves and to do whatever they want with them.
Work Principle
Make clear that the organization's structure and rules are designed to ensure that its checks-and-balances system functions well.
Every organization has its own way of doing this. The diagram below is a sketch of my conceptualization of how this should work for Bridgewater, which is currently an organization of about 1,500 people. The principles it follows, however, are universal; I believe that all organizations need some version of this basic structure.
There are one to three chairmen working with seven to fifteen board members supported by staff, whose purpose is primarily to assess whether: 1) The people running the company are capable; 2) The company is operating in accordance with its agreed-upon principles and rules. The board has the power to select and replace the CEOs, but doesn't engage in the micromanagement of the firm nor the people running it, though in the event of an emergency, they can drop into a more active role. (They can also help the CEOs to the extent they want it.) While Bridgewater's idea meritocracy is ideally all- inclusive, there need to be various circles of authority, trust and access to information, and decision-making authority, which are shown in the chart's three circles.
Work Principle
- And for Heaven's Sake, Don't Overlook Governance!
- To be successful, all organizations must have checks and balances.
- Make clear that the organization's structure and rules are designed to ensure that its checks-and-balances system functions well.
- To be successful, all organizations must have checks and balances.
Any person or organization can adopt Principles to better achieve their goals.
Learn what Principles are and how they are applied at Principles.com
