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.
Life Principle
Know when it's best to stop fighting and have faith in your decision-making process.
It’s important that you think independently and fight for what you believe in, but there comes a time when it’s wiser to stop fighting for your view and move on to accepting what believable others think is best. This can be extremely difficult. But it’s smarter and ultimately better for you to be open-minded and have faith that the consensus of believable others is better than whatever you think. If you can’t understand their view, you’re probably just blind to their way of thinking. If you continue doing what you think is best when all the evidence and believable people are against you, you’re being dangerously arrogant.
The truth is that while most people can become radically openminded, some can’t, even after they have repeatedly encountered lots of pain from betting that they were right when they were not. People who don’t learn radical open-mindedness don’t experience the metamorphosis that allows them to do much better. I myself had to have that humility beaten into me by my crashes, especially my big one in 1982. Gaining open-mindedness doesn’t mean losing assertiveness. In fact, because it increases one’s odds of being right, it should increase one’s confidence. That has been true for me since my big crash, which is why I’ve been able to have more success with less risk.
Becoming truly open-minded takes time. Like all real learning, doing this is largely a matter of habit; once you do it so many times it is almost instinctive, you’ll find it intolerable to be any other way. As noted earlier, this typically takes about eighteen months, which in the course of a lifetime is nothing.
RECENT USER EXCHANGES
I opened my business the overwhelming majority of people thought I was crazy. I was laughed at and called many unique names. They were all wrong. Certainly you have gone against the grain in your fantastic career. I’m confused about the message here.
I experienced the same thing - ie others thought I was crazy but my crazy ways panned out. Having said that I have found that the best way for me and the visionary innovators I know to succeed in unimaginable ways is to have others who are smart attack his theories so that the logic behind those attacks can be assessed and, after it’s assessed, to choose well.
I get the sentiment and the link to self awareness but where is the line between visionary / innovator and this - surely many have been through similar situations and come out the other side better for staying the course?
The visionary innovator knows that the best way to stretch the boundaries to succeed in unimaginable ways is to have others who are smart attack his theories, assess their logic and, then choose well. I know that I can only comfortably go to those outter boundaries if it do that.
Simply going along with a group’s opinion because they are your “decision making process” means never questioning if the process could be improved.
I presume that you haven’t read my Principles book, most importantly about how to be open-minded and assertive at the same time and about how decision making is a two step process (of taking in and then deciding). I suggest that you read those principles because that will help you understand the concept better. In other words, I recommend that you will take in what I have to say about the issue you are raising and then decide for yourself what you want to do with it.
Should I keep going with my way of view if I can see why I am right and they are wrong even though most people disagree?
The key thing that you need to do is get out the best answer without being dangerously biased in thinking that the best answer is in your head. The key to doing that well is through knowing how to triangulate well, which is explained more comprehensively in my book than I can explain here. If the question at hand is important main thing is to find two or three highly successful experts in the important area that you are trying to get a good perspectives about who are willing to disagree with you and the others. If you’re the odd one out, and you have honestly heard their objections to your thinking and you want to go ahead anyway, do so with caution. The main thing is that your confidence in your perspective is appropriate rather than arrogantly closed-minded.
So do you mean it’s being dangerously arrogant to believe in your own decisions and not listen to others?
No. To believe in one’s own decisions isn’t dangerously arrogant if ones own decisions have been well stress tested and one’s own assessment of one’s own decisions is accurately assessed. However, to believe one’s own opinions just because they’re one’s own opinion and because one is biased to believe oneself is just plain stupid and dangerous.
What if believable people don’t have time or interest to look at the evidence until the cases become to complex? Is this not a usual occurrence in the public sector?
Do the best you can. Pick the most believable people you can get to triangulate well with.
Is it about accepting other's view just for peace? Is it not unjust?
No. It’s about knowing when you have reached the point of diminishing returns in debating and issue and should then move on to deciding.
I try to learn from everyone because seeing other prospectives can sometimes be enlightening!
You have learned a great power to improve your learning and your decision making. Do that well, with great triangulating, and you will be radically more successful than if you don’t do it well.
Even though you do not have the authority or power to make the decision, should you "agree" for the sake of consensus- especially when the stakes are high?
I would never agree to a consensus of people who are not more believable than me and I have always agreed to a believability weighted group of people who have more believability than I have.
Did you become a billionaire by doing this?
Yep. That’s how I became a billionaire. Said differently, I became a billionaire by knowing when to rely on my own views and when to instead rely on others views. I did that by understanding the art of thoughtful disagreement and by knowing how to triangulate well in the ways I described in my book Principles. That, more than anything, is the gift that I wish I could give people.
Groupthink among believable others is my biggest fear.
The antidote for group think is thoughtful disagreement. I recommend that you review in my book my recommendations for how to do that well and how to triangulate well.
The crucial point is believable others. People who's opinion or experience or expertise you can rely on. Is this easy to do? No. But crucial to play at a bigger scale than yourself.
You understand.
Life Principle
- Be Radically Open-Minded
- Understand how you can become radically open-minded.
- Know when it's best to stop fighting and have faith in your decision-making process.
- Understand how you can become radically open-minded.
Any person or organization can adopt Principles to better achieve their goals.
Learn what Principles are and how they are applied at Principles.com
