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 typical organizations, most decisions are made either autocratically, by a top-down leader, or democratically, where everyone shares their opinions and those opinions that have the most support are implemented. Both systems produce inferior decision making. That’s because the best decisions are made by an idea meritocracy with believability-weighted decision making, in which the most capable people work through their disagreements with other capable people who have thought independently about what is true and what to do about it.
It is far better to weight the opinions of more capable decision makers more heavily than those of less capable decision makers. This is what we mean by “believability weighting.” So how do you determine who is capable at what? The most believable opinions are those of people who 1) have repeatedly and successfully accomplished the thing in question, and 2) have demonstrated that they can logically explain the cause-effect relationships behind their conclusions. When believability weighting is done correctly and consistently, it is the fairest and the most effective decision-making system. It not only produces the best outcomes but also preserves alignment, since even people who disagree with the decision will be able to get behind it.
But for this to be the case, the criteria for establishing believability must be objective and trusted by everybody. At Bridgewater everyone’s believability is tracked and measured systematically, using tools such as Baseball Cards and the Dot Collector that actively record and weigh their experience and track records. In meetings we regularly take votes about various issues via our Dot Collector app, which displays both the equal-weighted average and the believability-weighted results (along with each person’s vote).
Typically, if both the equal-weighted average and the believability-weighted votes align, we consider the matter resolved and move on. If the two types of votes are at odds, we try again to resolve them and, if we can’t, we go with the believability-weighted vote. Depending on what type of decision it is, in some cases, a single “Responsible Party” (RP) can override a believability-weighted vote; in others, the believability- weighted vote supersedes the RP’s decision. But in all cases believability-weighted votes are taken seriously when there is disagreement. Even in cases in which the RPs can overrule the believability-weighted vote, the onus is on the RP to try to resolve the dispute before overruling it. In my forty years at Bridgewater, I never made a decision contrary to the believability-weighted decision because I felt that to do so was arrogant and counter to the spirit of the idea meritocracy, though I argued like hell for what I thought was best.
Regardless of whether or not you use this kind of technology and structured process for believability weighting, the most important thing is that you get the concept. Simply look down on yourself and your team when a decision needs to be made and consider who is most likely to be right. I assure you that, if you do, you will make better decisions than if you don’t.