Understanding What Is True Is Essential For Success

Understanding what is true is essential for success, and being radically transparent about everything, including mistakes and weaknesses, helps create the understanding that leads to improvements.

That’s not just a theory; we have put this into practice at Bridgewater for over forty years, so we know how it works. But like most things in life, being radically truthful and transparent has cons as well as pros, which I will describe as accurately as possible.

Being radically truthful and transparent with your colleagues and expecting your colleagues to be the same with you ensures that important issues are apparent instead of hidden. It also enforces good behavior and good thinking, because when you have to explain yourself, everyone can openly assess the merits of your logic.

If you are handling things well, radical transparency will make that clear, and if you are handling things badly, radical transparency will make that clear as well, so it helps to maintain high standards.

Radical truth and radical transparency are fundamental to having a real idea meritocracy. The more people can see what is happening—the good, the bad, and the ugly—the more effective they are at deciding the appropriate ways of handling things.

This approach is also invaluable for training: Learning is compounded and accelerated when everyone has the opportunity to hear what everyone else is thinking.

As a leader, you will get the feedback essential for your learning and for the continual improvement of the organization’s decision-making rules. And seeing firsthand what’s happening and why builds trust and allows people to make the independent assessments of the evidence that a functioning idea meritocracy requires.

Why Most People Make Bad Decisions

Most people make bad decisions because they are so certain that they're right that they don't allow themselves to see the better alternatives that exist. Radically open-minded people know that coming up with the right questions and asking other smart people what they think is as important as having all the answers.

Don’t Lower The Bar.

You reach a point in all relationships when you must decide whether you are meant for each other - that's common in private life and at any organization that holds very high standards.

At Bridgewater, we know that we cannot compromise on the fundamentals of our culture, so if a person cannot operate within our requirements of excellence through radical truth and transparency in an acceptable time frame, he or she must leave. 

Principle Of The Day

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.

Where You Go In Life

Where you go in life will depend on how you see things and who and what you feel connected to (your family, your community, your country, mankind, the whole ecosystem, everything).

You will have to decide to what extent you will put the interests of others above your own, and which others you will choose to do so for.

Why People Make Bad Decisions

Most people make bad decisions because they are so certain that they're right that they don't allow themselves to see the better alternatives that exist.

Radically open-minded people know that coming up with the right questions and asking other smart people what they think is as important as having all the answers.

Understand How People Came By Their Opinions

Our brains work like computers: they input data and process it in accordance with their wiring and programming. Any opinion you have is made up of these two things: the data and your processing or reasoning.

When someone says, "I believe X," ask them: What data are you looking at? What reasoning are you using to draw your conclusion? Dealing with raw opinions will get you and everyone else confused; understanding where they come from will help you get to the truth.

Two People Who Collaborate Well (1+1=3)

Two people who collaborate well will be about three times as effective as each of them operating independently, because each will see what the other might miss—plus they can leverage each other’s strengths while holding each other accountable to higher standards.

Principle Of The Day: Teams Should Operate Like Those In Professional Sports

Teams should operate like those in professional sports, where different skills are required to play different positions. Excellence in each is mandatory, the success of the mission is uncompromisable, and members that don’t measure up may need to be cut.

Thoughts on Bitcoin

I think that Bitcoin (and some other digital currencies) have, over the last ten years, established themselves as interesting gold-like asset alternatives, with similarities and differences to gold and other limited-supply, mobile (unlike real estate) store holds of wealth.

As far Bitcoin relative to gold, I have a strong preference for holding those things which central banks are going to want to hold and exchange value in when they are trying to transact.

Successful People Learn From Mistakes

Everyone makes mistakes. The main difference is that successful people learn from them and unsuccessful people don’t. By creating an environment in which it's okay to safely make mistakes so that people can learn from them, you’ll see rapid progress and fewer significant mistakes.

What Does A Successful Life Look Like?

People who achieve success and drive progress deeply understand the cause-effect relationships that govern reality and have principles for using them to get what they want. The converse is also true: Idealists who are not well grounded in reality create problems, not progress.

What does a successful life look like? We all have our own deep-seated needs, so we each have to decide for ourselves what success is... Each of us needs to decide what we value most and choose the paths we take to achieve it.

 

How To Focus On A Goal

If you're focused on the goal, excited about achieving it, and recognize that doing some undesirable tasks to achieve the goal is required, you will have the right perspective and will be appropriately motivated.

If you're not excited about the goal that you're working for, stop working for it. Personally, I like visualizing exciting new and beautiful things that I want to make into realities.

The excitement of visualizing these ideas and my desire to build them out is what pulls me through the thorny realities of life to make my dreams happen.

Peace & Prosperity

In the new chapter of my series, The Changing World Order, I explore the timeless and universal principles that drive the big cycle of order and disorder within nations, especially as they relate to what’s happening in the US now.

Principles: People, Culture and Transparency

Being Radically Transparent

Understanding what is true is essential for success, and being radically transparent about everything, including mistakes and weaknesses, helps create the understanding that leads to improvements.

A Great Organization Has Both Great People And A Great Culture

Companies that get progressively better over time have both. Nothing is more important or more difficult than to get the culture and the people right.

Reforming The System

If we cannot agree on a path that both increases the size of the pie by maximizing human productivity and divides the pie well so there is something approaching equal opportunity, we will fight each other and not be productive which will hurt most everyone. There is no system that has proven better than capitalism in providing incentives, ideas and products. And it can easily be reformed to work better for most people. What’s the better choice?

Following Principles

Following principles is for me simply like following good recipes that get me what I want. However, when operating in a principled way one can see things from a higher level so that one wants to operate with a high standard of behavior. 

Principle Of The Day: Fail Well

Everyone fails. Anyone you see succeeding is only succeeding at the things you’re paying attention to—I guarantee they are also failing at lots of other things. The people I respect most are those who fail well. I respect them even more than those who succeed. 

That is because failing is a painful experience while succeeding is a joyous one, so it requires much more character to fail, change, and then succeed than to just succeed. People who are just succeeding must not be pushing their limits. Of course the worst are those who fail and don’t recognize it and don’t change.

You Must Stretch Yourself

It’s a basic law of nature: You must stretch yourself if you want to get strong. You and your people must act with each other like trainers in gyms in order to keep each other fit. Force yourself and the people who work for you to do difficult things.

Principle of the Day: Meaningful Work & Relationships

I asked if people were finding Principles useful in guiding them through this time and I was so glad that a large number of folks said they were. Over the next few weeks, I’d like to pass along some of the principles that people said they were finding most helpful.

Principle of the Day:

Meaningful relationships are invaluable for building and sustaining a culture of excellence, because they create the trust and support that people need to push each other to do great things.