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 the process of learning what someone is like open, evolutionary, and iterative.
Articulate your assessment of a person's values, abilities, and skills up front and share it; listen to their and others' responses to your description; organize a plan for training and testing; and reassess your conclusions based on the performance you observe. Do this on an ongoing basis. After several months of discussions and real-world tests, you and your report should both have a pretty good idea of what he or she is like. Over time this exercise will crystallize suitable roles and appropriate training or it will reveal that it's time for the person to find a more appropriate job somewhere else.
Work Principle
- Constantly Train, Test, Evaluate, and Sort People
Make the process of learning what someone is like open, evolutionary, and iterative.
- Make your metrics clear and impartial.
- Encourage people to be objectively reflective about their performance.
- Look at the whole picture.
- For performance reviews, start from specific cases, look for patterns, and get in sync with the person being reviewed by looking at the evidence together.
- Remember that when it comes to assessing people, the two biggest mistakes you can make are being overconfident in your assessment and failing to get in sync on it.
- Get in sync on assessments in a nonhierarchical way.
- Learn about your people and have them learn about you through frank conversations about mistakes and their root causes.
- Understand that making sure people are doing a good job doesn't require watching everything that everybody is doing at all times.
- Recognize that change is difficult.
- Help people through the pain that comes with exploring their weaknesses.
Any person or organization can adopt Principles to better achieve their goals.
Learn what Principles are and how they are applied at Principles.com
