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
Don't be naive about dishonesty.
People lie more than most people imagine. I learned that by being in the position of being responsible for everyone in the company. While we have an exceptionally ethical group of people, in all organizations there are dishonest people who have to be dealt with in practical ways. For example, don't believe most people who are caught being dishonest when they say that they've seen the light and will never do it again because chances are they will. Dishonest people are dangerous, so keeping them around isn't smart.
At the same time, let's be practical. If I tried to limit my relationships to people who never lied, I'd have nobody to work with. While I have extremely high standards when it comes to integrity, I don't view it in a black-white, one-strike-and-you're-out way. I look at the severity, the circumstances, and the patterns to try to understand whether I am dealing with a person who is a habitual liar and will lie to me again, or with a person who is fundamentally honest yet imperfect. I consider the significance of the dishonesty itself (Was the person stealing a piece of cake or were they committing a felony?) as well as the nature of our existing relationship (Is it my spouse telling the lie, a casual acquaintance, or an employee?). Treating such cases differently is appropriate because a basic law of justice is that the punishment should fit the crime.
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Do you have any options if your spouse lies to you?
For me it’s the same, just more serious. To be able to trust the people I care about and operate in a way that they can trust me creates so many practical benefits that makes the cost of not operating with radical truthfulness so great that I don’t have any to have it. Of course, as I’ve explained elsewhere, nothing is 100pct perfect because everything has some forms of extenuating circumstances.
Do you think it depends on what others are lying about?
That is true for me too, but to be clear, if the lie isn’t tiny and/or doesn’t have extenuating circumstances, it won’t be ok with me. Btw, I’m not asking others to give me what I won’t give.
Do your think there are degrees of dishonesty and degrees of truthfulness?
Sure there are various severities of dishonesty that have to be considered and there are occasions when a white lie might be appropriate. Like all my principles, there are always some cases in which exceptions are warranted. The question is where the norm is and what are the consequences of deviations from it. I think my norm and what I think of as an acceptable deviation and how I shaped my company is different in ways that I believe produces better outcomes than what is usually considered normal. For example, while it’s true that a small white lie might not be a big deal, I think it’s a bigger deal than most people because I know that if I’m caught in one, or if I catch someone in one, it puts a crack in my or that other person’s credibility that undermines trust. When one has trust of others, one has a tremendous asset. To know that others are trustworthy is a tremendous benefit. Besides leading to better relationships, it makes dealing with issues much more efficient and it gives people who operate that way the freedom to be themselves. It’s easier to be this way when one operates in a culture that is this way, and I was able to have that culture because I started and shaped the culture of Bridgewater — and operating that way was and continues to be self-reinforcing because it produces success and attracts people who want to be that way — however, we all have choices. For people who can shape their organizations, I want to pass along how effective it is to create a radically truthful and transparent culture. For those who don’t have the power to shape their organizations, I want to convey how beneficial it is to move to an organization that operates that way. In your personal life, operating that way with others and dealing with people who operate that way with you is also very powerful.
I have adopted my own version of radical honesty at home and in my business and have learned that truth really makes us free.
I hope others who have not experienced the consequences of being radically truthful as you have will interact with you about this. I also hope that you will pass around to others what you have experienced and have come to believe.
While you are in a position of power and can choose to give second chances, if you were an employee and realise that your boss/ management is being dishonest then what would you do ?
Please understand that my operating this way came first and gave me my power rather than my power giving me the ability to operate this way. What I wouldn’t do, which is what it sounds like you’d be willing to do that I’d recommend you not do, is be suppressed because of fear of retaliation of my boss. To me that sounds like resigning myself to a life I have no control of, living in fear of what my boss might do to me. So, to answer your question directly: If I found my boss to be dishonest I’d ask him about it and see what he had to say, and I’d resolve this to my satisfaction. If the environment didn’t let me do that, I’d leave. I think too many people are trapped in bad environments because of inappropriately exaggerated fears that they can’t find a good alternative. That approach to life of settling for the inacceptable guarantees an unsatisfactory life. Most people can make changes to get what they want if they’re committed to not settling.
Would you fire the CEO or other critical employees if they lie to you?
As a rule I fire anyone who lies to me regardless of what job they’re in for too many reasons to delve into in this limited space. If it was a CFO who lies to me that would especially scare me as the person in that job must be honest because the consequences of dishonesty in that job can be devastating. Of course, as with any rule, it’s not 100pct true in that the size of the lie (can be tiny), the circumstances behind it (to do some greater good) and the persons track record (they might never have lied in the last 15 years) are relevant for me to determine if I have a liar on my hands (which I won’t tolerate). You get the idea of my standard. Btw, it should come through in the holistic reading of my principles because I provided a number of principles about where and how I’d draw the line, as well as why I’d draw the line that way. As always, I’m just conveying to you the principles that I believe as best and worked well for me for you to take or leave as you see fit.
Work Principle
Any person or organization can adopt Principles to better achieve their goals.
Learn what Principles are and how they are applied at Principles.com
