April 30, 2016

Do What You Set Out to Do...Push Through!

"I believe that having principles that work is essential for getting what we want out of life," Ray Dalio writes in his book on life and management principles. Mr. Dalio, Chairman and Chief Investment Officer at Bridgewater Associates, an investment firm, further says: "I also believe that to understand each other we have to understand each other's principles. That is why I believe we need to talk about them." This post looks into a few principles I apply in my life.

Mr. Dalio segments his book, Principles, in three parts: "Part 1 is about the purpose and importance of having principles in general, having nothing to do with mine. Part 2 explains my most fundamental life principles that apply to everything I do. Part 3 explains my management principles as they are being lived out at Bridgewater." He presents the purpose and desired use of this book by writing:
Above all else, I want you to think for yourself—to decide 1) what you want, 2) what is true, and 3) what to do about it. I want you to do that in a clear-headed, thoughtful way, so that you get what you want. I wrote this book to help you do that. I am going to ask only two things of you—1) that you be open-minded and 2) that you honestly answer some questions about what you want, what is true, and what you want to do about it. If you do these things, I believe that you will get a lot out of this book. If you can't do these things, you should reflect on why that is, because you probably have discovered one of your greatest impediments to getting what you want out of life.
Mr. Dalio presents the following as his most fundamental principle: "Truth —more precisely, an accurate understanding of reality— is the essential foundation for producing good outcomes." I completely agree. I can name numerous examples of when my accurate understanding of reality was essential for producing good outcomes. Equally important, however, is the fact that I am able to provide many stories of an inaccurate understanding of reality that led to the production of negative outcomes. It is these moments that I take as learning moments and opportunities to strengthen my ethical core values.

"I believe that the desire to evolve, i.e., to get better, is probably humanity's most pervasive driving force" Mr. Dalio continues: "Enjoying your job, a craft, or your favorite sport comes from the innate satisfaction of getting better. Though most people typically think that they are striving to get things (e.g., toys, better houses, money, status, etc.) that will make them happy, that is not usually the case. Instead, when we get the things we are striving for, we rarely remain satisfied." I find great enjoyment in improving my skills whether I am speeding down the slopes at my favorite ski area, learning the Chinese language or building ROI3, Inc.

In his "Summary and Table of Principles," Mr. Dalio provides more than 200 enumerated principles. I am particularly fond of principles 8-19:
8) Create a Culture in Which It Is OK to Make Mistakes but Unacceptable Not to Identify, Analyze, and Learn From Them
... 9) Recognize that effective, innovative thinkers are going to make mistakes.
... 10) Do not feel bad about your mistakes or those of others. Love them!
... 11) Observe the patterns of mistakes to see if they are a product of weaknesses.
... 12) Do not feel bad about your weaknesses or those of others.
... 13) Don’t worry about looking good—worry about achieving your goals.
... 14) Get over “blame” and “credit” and get on with “accurate” and “inaccurate.”
... 15) Don’t depersonalize mistakes.
... 16) Write down your weaknesses and the weaknesses of others to help remember and acknowledge them.
... 17) When you experience pain, remember to reflect.
... 18) Be self-reflective and make sure your people are self-reflective.
... 19) Teach and reinforce the merits of mistake-based learning.
a) The most valuable tool we have for this is the issues log (explained fully later), which is aimed at identifying and learning from mistakes.
Throughout my professional career, I have learned that success (and failure) is often associated with team that you build. Therefore, I found principles 117-127 to resonate similarly to how I approach my management style:
117) Train and Test People Through Experiences
... 118) Understand that training is really guiding the process of personal evolution.
... 119) Know that experience creates internalization.
... 120) Provide constant feedback to put the learning in perspective.
... 121) Remember that everything is a case study.
... 122) Teach your people to fish rather than give them fish.
... 123) Recognize that sometimes it is better to let people make mistakes so that they can learn from them rather than tell them the better decision.
a) When criticizing, try to make helpful suggestions.
b) Learn from success as well as from failure.
... 124) Know what types of mistakes are acceptable and unacceptable, and don't allow the people who work for you to make the unacceptable ones.
... 125) Recognize that behavior modification typically takes about 18 months of constant reinforcement.
... 126) Train people; don’t rehabilitate them. a) A common mistake: training and testing a poor performer to see if he or she can acquire the required skills without simultaneously trying to assess their abilities.
... 127) After you decide "what’s true" (i.e., after you figure out what your people are like), think carefully about "what to do about it."
And quite simply:
188) Do What You Set Out to Do... 189) Push through!
What is your reaction to Mr. Dalio's Principles? What would you add?

Aaron Rose is an advisor to talented entrepreneurs and co-founder of great companies. He also serves as the editor of Solutions for a Sustainable World.

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