To lead and manage teams effectively the My Org App has leveraged the top principles and action items that came from the most trusted resources. The list below has the details on this book and all the key principles and actions that came from this book to make the app.
Title: Principles: Life and Work
From Amazon: Ray Dalio, one of the world’s most successful investors and entrepreneurs, shares the unconventional principles that he’s developed, refined, and used over the past forty years to create unique results in both life and business—and which any person or organization can adopt to help achieve their goals
Remember That the WHO Is More Important than the WHAT People often make the mistake of focusing on what should be done while neglecting the more important question of who should be given the responsibility for determining what should be done. That’s backward. When you know what you need in a person to do the job well and you know what the person you’re putting into it is like, you can pretty well visualize how things will go.
Know that the ultimate Responsible Party will be the person who bears the consequences of what is done. So long as you bear the consequences of failure, you are the ultimate Responsible Party. For example, while you might choose to delegate the responsibility of figuring out how to handle your illness to a doctor, it is your…
7.3 Remember the force behind the thing. Most people see the things around them without considering the forces that created them. In most cases those forces were specific people with specific qualities who worked in specific ways. Change the people and you change how things develop; replace creators with noncreators and you stop having creations. People tend to personify organizations (“Apple is a creative company”) while mistakenly depersonalizing their results, thus losing sight of who did what to produce them. That’s misguided because companies don’t make decisions—people do. So who are the…
we learned from our mistakes and failures that we could improve our hiring results in two ways: 1) by always being crisp and clear on exactly what kind of person we were looking for, and 2) by developing our vocabulary for and means of evaluating people’s abilities at a much more granular level.
Understand that hiring is a high-risk gamble that needs to be approached deliberately. A lot of time, effort, and resources go into hiring and developing new employees before it’s clear whether or not they are good fits. Months or even years and countless dollars can be wasted in training and retraining. Some of those costs are intangible, including loss of morale and a gradual diminishment of standards as people who aren’t excellent in their roles bump into each other; other costs from bad outcomes can be measured all too easily in dollars and cents.
8.1 Match the person to the design. When building a “machine,” design precedes people because the type of people you will need will depend on the design. As you design, create a clear mental image of the attributes required for each person to do their job well. It is futile to give responsibilities to people who do not have the qualities required to succeed. It frustrates, and inevitably angers, all parties, which is damaging to the environment.
In order to match a person to the design, start by creating a spec sheet so that there will be a consistent set of criteria that can be applied from recruiting through performance reviews. Bridgewater’s spec sheets use the same bank of qualities as our Baseball Cards.
Don’t design jobs to fit people; over time, this almost always turns out to be a mistake. This often happens when someone you are reluctant to let
In picking people for long-term relationships, values are most important, abilities come next, and skills are the least important. Yet most people make the mistake of choosing skills and abilities first and overlooking values.
If your people are bound by a sense of community and mission and they are capable, you will have an extraordinary organization.
You should think through what questions are asked and how the different answers candidates give differentiate them in the ways that you are seeking to differentiate them. You should also save all of those answers so you can learn about how indicative they might be of subsequent behaviors and performance. I do not mean that the human dimension or art of the hiring process should be eliminated—the personal values and esprit de corps part of a relationship are critically important and can’t be fully measured by data. Sometimes the twinkle in the eye and the facial expressions are telling. However, even for those areas where people’s subjective interpretations are important, you can still use data and a scientific approach to be more objective—for example, you can capture data to assess the track records of those making the interpretations.
Some ways of thinking will serve you well for some purposes and serve you poorly for others. It is highly desirable to understand one’s own and others’ ways of thinking and their best applications. Some qualities are more suitable for some jobs. For example, you might not want to hire a highly introverted person as a salesman. That’s not to say an introvert can’t do that job; it’s just that a gregarious person is likely to be more satisfied in the role and do a better job.
Understand how to use and interpret personality assessments. Personality assessments are valuable tools for getting a quick picture of what people are like in terms of their abilities, preferences, and style. They are often more objective and reliable than interviews.
If you’re looking for a visionary, pick a visionary to do the interview in which you probe for vision. If you are looking for a mix of qualities, assemble a group of interviewers who embody those qualities collectively. Don’t choose interviewers whose judgment you don’t trust (in other words, make sure they are believable).
Everybody has strengths and weaknesses. The key to success is understanding one’s weaknesses and successfully compensating for them. People who lack that ability fail chronically.
This is especially true over short periods of time like a year or two, yet most people want to assume that when someone does something wrong the person will learn the lesson and change. That’s naive. It is best to assume that they won’t change unless there is good evidence to they will. It's better to bet on changes you have seen than those you hope for.
No one person possesses everything required to produce success, yet everyone must excel.
There are all sorts of jobs and they require all types of people to handle them. I am frequently biased toward finding the entrepreneur type—a clever, open-minded scrapper who will find the best solution—and I have often been disappointed. On the other hand, sometimes I have found a master craftsman who has devoted decades to his specialty who I could completely rely on.
To be practical one needs to be a realist—to know where people’s interests lie and how to design machines that produce results, as well as metrics that measure those benefits in relation to the costs. Without such measures, waste will limit or erase the benefits, and with them the benefits will keep flowing.
No matter how good you are at hiring, some of your hires won’t work out. Know how the people you’re considering operate and visualize how that will produce successful results. Knowing what they did is valuable only insofar as it helps you figure out what they are like.
Ultimately, what you need in the people you work with are excellent character and excellent capabilities, which is why it’s so hard to find great people.
Turnover is costly and inefficient because of the time it takes for people to get to know each other and the organization. Both the people you work with and the company itself will evolve in ways you can’t anticipate. So hire the kind of people you want to share a long-term mission with. You will always have uses for great people.
You need people who share your tastes and style but who can also push and challenge each other. The best teams, whether in music, in sports, or in business, do all those things at the same time.
Pay people enough so that they’re not under financial stress, but not so much that they become fat and happy. You want your people to be motivated to perform so they can realize their dreams. You don’t want people to accept a job for the security of making a lot more money—you want them to come for the opportunity to earn it through hard and creative work.
While you will never fully capture all the aspects that make for a great work relationship in metrics, you should be able to establish many of them. Tying performance metrics to compensation will help crystallize your understanding of your deal with people, provide good ongoing feedback, and influence how the person behaves on an ongoing basis.
Pay north of fair. By being generous or at least a little north of fair with others I have enhanced both our work and our relationships and most people have responded in kind. As a result, we have gained something even more special than money in the form of mutual caring, respect, and commitment.
The best negotiations are the ones with someone in which I say, “You should take more,” and they argue back, “No you should take more!” People who operate this way with each other make the relationship better and the pie bigger—and both benefit in the long run.
Be generous and expect generosity from others. If you’re not generous with others and others aren’t generous with you, you won’t have a quality relationship.
Make sure you are building meaningful relationships and constantly getting in sync. Most importantly, you have to encourage people to speak up about how things are going for them. Ensuring that their personal development is proceeding appropriately is important too. Close advice from an active mentor should last at least one year. When you know what someone is like, you know what you can expect from them.
A manager’s ability to recognize when outcomes are inconsistent with goals and then modify designs and assemble people to rectify them makes all the difference in the world. The more often and more effectively a manager does this, the steeper the upward trajectory.
Not knowing what is required to do the job well and not knowing what your people are like is like trying to run a machine without knowing how its parts work together.
7.1 Recognize that the most important decision for you to make is who you choose as your Responsible Parties. If you put your goals in the hands of RPs who can execute those goals well, and if you make it clear to them that they are personally responsible for achieving those goals and doing the tasks, they should produce excellent results. The same goes for yourself. If your designer/manager-you doesn’t have a good reason to be confident that your worker-you is up to a given task, it would be crazy to let yourself do the task without seeking the supervision of believable parties. You know that there are a lot of incompetent people in the world trying to do things they’re not good at, so the chances are good that you are one of them. That’s just a reality and it’s okay for you to accept it and deal with it in a way that produces good outcomes.
Understand that the most important RPs are those responsible for the goals, outcomes, and machines at the highest levels. Give me someone who can be responsible for an entire area—someone who can design, hire, and sort to achieve the goal—and I can be comfortable things will go well. These are the most important people to choose and manage well. Senior managers must be capable of higher-level thinking,…
Make sure that everyone has someone they report to. Even a company’s owners have bosses, in their case, the investors whose money is being spent to achieve their goals. If the owners are self-funded, they still have to make their clients and employees happy. And they can’t escape the responsibility of making sure that their costs are acceptable and their goals are being…
Think through which values, abilities, and skills you are looking for (in that order). Values are the deep-seated beliefs that motivate behaviors and determine people’s compatibilities with each other. People will fight for their values, and they are likely to fight with people who don’t share them. Abilities are ways of thinking and behaving. Some people are great learners and fast processors; others possess the ability to see things at a higher level. Some focus more on the particulars; still others think creatively or logically or with supreme organization. Skills are learned tools, such as being able to speak a foreign language or write computer code. While values and abilities are unlikely to change much, most skills can be acquired in a limited amount of time (e.g., software proficiency can be learned) and often change in worth (today’s most in-demand programming language is likely to be obsolete in a few years).
The process for choosing people should be systematically built out and evidence-based. You need to have a people-hiring machine in which the goals are clearly stated so that the outcomes can be compared with them and the machine (the design and the people) producing the outcomes can evolve to improve.
Hear the click: Find the right fit between the role and the person.Remember that your goal is to put the right people in the right design. First understand the responsibilities of the role and the qualities needed to fulfill them, then ascertain whether an individual has them. When you’re doing this well, there should almost be an audible “click” as the person you’re hiring fits into his or her role.
Look for people who sparkle, not just “any ol’ one of those.” Too many people get hired because they are just “one of those.” If you’re looking for a plumber you might be inclined to fill the job with the first experienced plumber you interview, without ascertaining whether he has the qualities of an outstanding plumber. Yet the difference between an ordinary plumber versus an outstanding one is huge. When reviewing any candidate’s background, you must identify whether they have demonstrated themselves to be extraordinary in some way. The most obvious demonstration is outstanding performance within an outstanding peer group. If you’re less than excited to hire someone for a particular job, don’t do it. The two of you will probably make each other miserable.
People’s personalities are pretty well formed before they come to you, and they’ve been leaving their fingerprints all over the place since childhood; anyone is fairly knowable if you do your homework. You have to get at their values, abilities, and skills: Do they have a track record of excellence in what you’re expecting them to do successfully at least 3 times?
Talk to believable people who know them, look for documented evidence, and ask for past reviews from their bosses, subordinates, and peers. As much as possible, you want to get a clear and objective picture of the path that they have chosen for themselves and how they have evolved along the way. I’ve seen plenty of people who claimed to be successful elsewhere operate ineffectively at Bridgewater. A closer look often revealed that they were either not as successful as they portrayed themselves or they got credit for others’ accomplishments.
Recognize that performance in school doesn’t tell you much about whether a person has the values and abilities you are looking for. Largely because they are the easiest to measure, memory and processing speed tend to be the abilities that determine success in school, so school performance is an excellent gauge of these qualities. School performance is also a good gauge of a person’s determination to succeed, as well as their willingness and ability to follow directions. But when it comes to assessing a candidate’s common sense, vision, creativity, or decision-making abilities, school records are of limited value. Since those traits are the most important, you must look beyond school to ascertain whether an applicant has them.
Idealistic people who have moralistic notions about how people should behave without understanding how people really do behave do more harm than good.
The person who is capable but doesn’t have good character is generally destructive, because he or she has the cleverness to do you harm and will certainly erode the culture.
Smart people are the ones who ask the most thoughtful questions, as opposed to thinking they have all the answers. Great questions are a much better indicator of future success than great answers.
Show your job prospects the real picture, especially the bad stuff. Also show them the principles in action, including the most difficult aspects.
Look at what people in comparable jobs with comparable experience and credentials make, add some small premium over that, and build in bonuses or other incentives so they will be motivated to knock the cover off the ball. Never pay based on the job title alone.