Principles: Life and Work – Ray Dalio

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Principles: Life and Work – Ray Dalio

 

 “Operate by principles that are so clearly laid out that their logic can easily be assessed and you and others can see if you walk the talk.” Ray Dalio 
  

 

Have you ever shared your principles?

Bridgewater Associates is the world’s best performing hedge fund and the fifth most important private company in the United States. Black Monday of 1987 saw the largest single-day percentage decline in the history of the stock market but Bridgewater ended the day up by 22% while others crashed. The company also anticipated and navigated the 2008 debt crisis.

Bridgewater’s founder Ray Dalio says that whatever success he’s had in life has more to do with knowing how to deal with what he doesn’t know, than what he does know. Dalio was an ordinary kid from a middle-class neighbourhood who disliked school – but he has created an exceptionally effective work culture through clear principles. Dalio describes the culture as an idea meritocracy that strives to achieve meaningful work and meaningful relationships through radical transparency.

Dalio published a summary of his original principles on Bridgewater’s website in 2010 which has been downloaded more than three million times. Now that he has stepped back from running the company to become chairman and more engaged in philanthropy, he wants to share his experiences and updated life and work principles with others. His principles for investing and an app to help you apply the principles will follow.

Split into the three parts, the book first outlines how he began the company over 40 years ago from his two-bedroom apartment and made some spectacular gains and losses. Painfully, at one point his management team set up a meeting to explain to him why his direct personal style was detrimental to the morale of employees. This prompted Dalio to start putting his principles into writing so that everyone could understand how employees should work together, and how every situation that came up would be handled.

Life Principles

Work Principles overall:

Culture Principles

People Principles

Despite being a successful Harvard graduate, because of his poor rote memory Dalio has always exploited the power of computers, developing algorythms to test market and human assumptions. He has developed a number of software tools to apply computer algorthyms to people and decision making within Bridgewater, such as issue logs, pain buttons, a dispute resolver and a contract tool. Examples include:

While some may find Dalio’s approach and computer-backed analysis of principles daunting, it has undoubtedly helped Bridgwater become one of the world’s most successful companies, whose advice is sought by governments and organisations globally. Could this be the time to develop and lay out your own organisation’s principles as honestly and openly as Dalio, before your culture evolves into one you don’t recognise?

 

About the author

Ray Dalio founded Bridgewater Associates in 1975 – the largest and best performing hedge fund in the world and Fortune magazine’s fifth most important private company in the US. According to Forbes magazine Dalio is one of the hundred richest people in the world and has appeared on the Time 100 list of the world’s most influential people. He graduated from Harvard Business School and lives with his family in Connecticut.

 

Reviews

“Mr Dalio has long been an object of fascination . . . His new book is more significant than the original list of principles: It is part memoir, part how-to guide. It is a deeply personal story, with Mr Dalio wading into how he started his firm in 1975, internal conflicts inside the company, and strife early on in his career. The book is both instructive and surprisingly moving. . . . Underneath what may seem like a clinical, emotionless approach is something different and far more poignant…” The New York Times

“Ray Dalio has provided me with invaluable guidance and insights that are now available to you in Principles.” Bill Gates

“Ray Dalio’s market acumen is legendary, but it was creating and living by a set of principles that allowed him to reach the top. Everyone with goals and dreams can learn from Ray’s approach.” Michael Bloomberg

 

 

 

Book Details

Author: Ray Dalio

ISBN: 978-1501124020