May 22, 2019

Ray Dalio Author and Founder of Bridgewater on Principles for Managing Work and Life.

Ray Dalio visited Google recently to discuss his management principles.

Ray Dalio, was the founder of Bridgewater Associates, a top tier hedge fund, that he started out of a two-bedroom apartment in 1975.

Ray Dalio discuses life’s three big stages:

1. You are learning from others
2. You are working and you are trying to be successful
3. Freedom – Helping others be successful without you.

Over time, Ray made it a habit to document the reasons behind his decisions, as he calls it, his principles.

Some of his principles at Bridgewater included building a meritocracy that valued thoughtful disagreement. Some of the key components of this included:

– Enabling meaningful work and meaningful relationships through radical truthfulness and transparency.
– For employees allowing people in the culture to be open about conveying their ideas.  This was especially important for their hedge fund as many times investments must be contrarian or provide some non-consensus view since the stock price already incorporates the consensus view.
– And to hold people accountable by recording everything that everyone said. According to Dalio, employees would record many meetings and decisions.

Dalio generalized his approach to success with a five-step process:

  1. Goals. Know what your goals are and be clear about them
  2. Problems. Identify the problems that are occurring.
  3. Diagnose the Root Cause. Diagnose the root cause of the problems.
  4. Design Solutions.  Design solutions that you or others can do.  For example, if you are not good at something it is okay if you find someone else to do it”
  5. Do it. You actually have to implement and try the items that are necessary.

 

 

 

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