Black and white portrait of Ray Dalio: Narrator and Creator of Life Principles

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.

Work Principle

Diagnose Problems to Get at Their Root Causes

When you encounter problems, your objective is to specifically identify the root causes of those problems—the specific people or designs that caused them—and to see if these people or designs have a pattern of causing problems.

What are the most common reasons for failing to diagnose well?

The most common mistake I see people make is dealing with their problems as one-offs rather than using them to diagnose how their machine is working so that they can improve it. They move on to fix problems without getting at their root causes, which is a recipe for continued failure. A thorough and accurate diagnosis, while more time-consuming, will pay huge dividends in the future.

The second most common mistake people make is to depersonalize the diagnosis. Not connecting problems to the people who failed and not examining what it is about them that caused the failure will not lead to improvements of the individuals or the machines.

The third biggest reason for failure is to not connect what one is learning in one diagnosis to what was learned in prior ones. It is important to determine whether the root cause of a particular problem (“Harry was careless”) is part of a larger pattern (“Harry is often careless”) or not (“It’s unlike Harry to be careless”).

Work Principle

Find a Meaningful Principle for You

Learn to get more of what you want out of life.

Life Principles

Work Principles

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