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
To be successful, all organizations must have checks and balances.
By checks, I mean people who check on other people to make sure they're performing well, and by balances, I mean balances of power. Even the most benevolent leaders are prone to becoming more autocratic, if for no other reason than because managing a lot of people and having limited time to do it requires them to make numerous difficult choices quickly, and they sometimes lose patience with arguments and issue commands instead. And most leaders are not so benevolent that they can be trusted to put the organization's interests ahead of their own.
Work Principle
- And for Heaven's Sake, Don't Overlook Governance!
To be successful, all organizations must have checks and balances.
- Even in an idea meritocracy, merit cannot be the only determining factor in assigning responsibility and authority.
- Make sure that no one is more powerful than the system or so important that they are irreplaceable.
- Beware of fiefdoms.
- Make clear that the organization's structure and rules are designed to ensure that its checks-and-balances system functions well.
- Make sure reporting lines are clear.
- Make sure decision rights are clear.
- Make sure that the people doing the assessing 1) have the time to be fully informed about how the person they are checking on is doing, 2) have the ability to make the assessments, and 3) are not in a conflict of interest that stands in the way of carrying out oversight effectively.
- Recognize that decision makers must have access to the information necessary to make decisions and must be trustworthy enough to handle that information safely.
Any person or organization can adopt Principles to better achieve their goals.
Learn what Principles are and how they are applied at Principles.com
