Principles: Table of Life Principles 3, 4 and 5 (part 4 of 14)

3. Be Radically Open-Minded

  1. Recognize your two barriers
    • Understand your ego barrier
    • Your two “you” fight to control you
    • Understand your blind spot barrier
  2. Practice radical open-mindedness.
    • Sincerely believe that you might not know the best possible path and recognize that your ability to deal well with “not knowing” is more important than whatever it is you do know.
    • Recognize that decision making is a two-step process: First take in all the relevant information, then decide.
    • Don’t worry about looking good; worry about achieving your goal.
    • Realize that you can’ t put out without taking in.
    • Recognize that to gain the perspective that comes from seeing things through another’s eyes, you must suspend judgement for a time – only by empathizing can you properly evaluate another point of view.
    • Remember that you’re looking for the best answer, not simply the best answer that you can come up with yourself.
    • Be clear on whether you are arguing or seeking to understand, and think about which is most appropriate based on your and others’ believability.
  3. Appreciate the art of thoughtful disagreement
  4. Triangulate your view with the believable people who are willing to disagree.
    • Plan for the worst-case scenario to make it as good as possible.
  5. Recognize the signs of closed-mindedness and open-mindedness that you should watch out for.
  6. Understand how you can become radically open-minded
    • Regularly use pain as your guide toward quality reflection.
    • Make being open-minded a habit.
    • Get to know your blind spots.
    • If a number of different believable people say you are doing something wrong and you are the only one who doesn’t see it that way, assume that you are probably biased.
    • Meditate.
    • Be evidence-based and encourage others to be the same.
    • Do everything in your power to help others also be open-minded.
    • Use evidence-based decision-making tools.
    • Know when it’s best to stop fighting and have faith in your decision-making process.

4. Understand That People Are Wired Very Differently

  1. Understand the power that comes from knowing how you and others are wired.
    • We are born with attributes that can both help us and hurt us, depending on their application.
  2. Meaningful work and meaningful relationships aren’t just nice things we chose for ourselves – they are genetically programmed into us.
  3. Understand the great brain battles an dhow to control them to get what “you” want.
    • Realize that the conscious mind is in a battle with the subconscious mind.
    • Know that the most constant struggle is between feeling and thinking.
    • Reconcile your feelings and your thinking.
    • Choose your habits well.
    • Train your “lower-level you” with kindness and persistence to build the right habits.
    • Understand the difference between right-brained and left-brained thinking.
    • Understand how much the brain can and cannot change.
  4. Find out what you and others are like.
    • Introversion vs. extroversion.
    • Intuiting vs. sensing.
    • Thinking vs.  feeling.
    • Planning vs. perceiving.
    • Creators vs. refiners vs. advancers vs. executors vs. flexors.
    • Focusing on tasks vs. focusing on goals.
    • Workplace Personality Inventory.
    • Shapers are people who can go from visualization to actualization.
  5. Getting the right people in the right roles in support of your goal is the key to succeeding at whatever you choose to accomplish.
    • Manage yourself and orchestrate others to get what you want.

5. Learn How to Make Decisions Effectively

  1. Recognize that 1) the biggest threat to good decision making is harmful emotions, and 2) decision making is a two-step process (first learning and then deciding)
  2. Synthesize the situation at hand
    • One of the most important decisions you can make is who you ask questions of.
    • Don’t believe everything you hear.
    • Everything looks bigger up close.
    • New is overvalued relative to great.
    • Don’t over squeeze dots.
  3. Synthesize the situation through time
    • Keep in mind both the rates of change and the levels of things, and the relationships between them.
    • Be imprecise.
    • Remember the 80/20 Rule and know what the key 20 percent is.
    • Be an imperfectionist.
  4. Navigate levels effectively
    • Use the terms “above the line” and “below the line” to establish which level a conversation is on.
    • Remember that decisions need to be made at the appropriate level, but they should also be consistent across levels.
  5. Logic, reason, and common sense are your best tools for synthesizing reality and understanding what to do about it.
  6. Make your decisions as expected value calculations.
    • Raising the probability of being right is valuable no matter what your probability of being right already is.
    • Knowing when not to bite is as important as knowing what bets are probably worth making.
    • the best choices are the ones that have more pros than cons, not those that don’t have any cons at all.
  7. Prioritize by weighing the value of additional information against the cost of not deciding.
    • All of your “must-dos” must be above the bar before you do your “like-to-dos.”
    • Chances are you won’t have time to deal with the unimportant things, which is better than not having time to deal with the important things.
    • Don’t mistake possibilities for probabilities.
  8. Simplify!
  9. Use principles.
  10. Believability weight your decision making.
  11. Convert your principles into algorithms and have the computer make decisions alongside you.
  12. Be cautious about trusting AI without having deep understanding.

 

Principles: Table of Life Principles 1 and 2 (part 3 of 14)

Summary and Table of Life Principles

  • Think for yourself to decide 1) what you want, 2) what is true, and 3) what you should do to achieve #1 in light of #2, and do that with humility and open-mindedness so that you consider the best thinking available to you.
  • Look to the patterns of those things that affect you in order to understand the cause-effect relationships that drive them and to learn principles for dealing with them effectively.
  1. Embrace Reality and Deal with it
    1.  Be a hyperrealist 
      • a Dreams + Reality + Determination = A Successful life
    2. Truth – or, more precisely, an accurate understanding of reality – is the essential foundation for any good outcome.
    3. Be radically open-minded and radically transparent
      • Radical open-mindedness and radical transparency are invaluable for rapid learning and effective change
      • Don’t let fears of what others think of you stand in your way.
      • Embracing radial truth and radical transparency will bring more meaningful work and more meaningful relationships
    4. Look to nature to learn how reality works
      • Don’t get hung up on your vies of ow things “should” be because you will miss out on learning how they really are.
      • To be “good,” something must operate consistently with the laws of reality and contribute to the evolution of the whole; that is what is most rewarded.
      • Evolution is the single greatest force in the universe; it is the only thing that is permanent and it drives everything
      • Evolve or die.
    5. Evolving is life’s greatest accomplishment and its greatest reward
      • The individual’s incentives must be aligned with the group’s goals.
      • Reality is optimizing for the whole – not for you.
      • Adaptation through rapid trial and error is invaluable.
      • Realize that you are simultaneously everything and nothing – and decide what you want to be.
      • What you will be will depend on the perspective you have.
    6. Understand nature’s practical lessons
      • Maximize your evolution
      • Remember “no pain, no gain.”
      • It is a fundamental law of nature that in order to gain strength one has to push one’s limits, which is painful.
    7. Pain + Reflection = Progress
      • Go to the pain rather than avoid it.
      • Embrace tough love.
    8. Weigh second- and third-order consequences
    9. Own your outcomes
    10. Look at the machine from the higher level
      • Think of yourself as a machine operating within a machine and know that you have the ability to alter your machines to produce better outcomes.
      • By comparing your outcomes with your goals, you can determine how to modify your machine.
      • Distinguish between you as the designer of your machine and you as a worker with your machine.
      • the biggest mistake most people make is to not see themselves and others objectively, which leads them to bump into their own and others’ weaknesses again and again.
      • Successful people are those who can go above themselves to see things objectively and mange those things to shape change.
      • Asking others who are strong in areas where you are weak to help you is a great skill that you should develop no matter what, as it will help you develop guardrails that will prevent yo from doing what you shouldn’t be doing.
      • Because it is difficult to see oneself objectively, you need to rely on the input of others and the whole body of evidence.
      • If you are open-minded enough and determined, you can get virtually anything you want.
  2. Use the 5-Step Process to Get What You Want Out of Life
    1. Have clear goals
      • Prioritize: While you can have virtually anything you want, you can’t have everything you want.
      • Don’t confuse goals with desires.
      • Decide what you really want in life by reconciling your goals and your desires.
      • Don’t mistake the trappings of success for success itself.
      • Never run out a goal because you think it’s unattainable.
      • Remember that great expectations create great capabilities.
      • Almost nothing can stop you from succeeding if you have 1) flexibility and b) self-accountability.
      • Knowing how to deal well with your setbacks is as important as knowing how to move forward.
    2. Identify and don’t tolerate problems
      • View painful problems as potential improvements that are screaming at you.
      • Don’t avoid confronting problems because they are rooted in harsh realities that are unpleasant to look at.
      • Be specific in identifying your problems.
      • Don’t mistake a cause of a problem with the real problem.
      • Distinguish big problems from small ones.
      • Once you identify a problem, don’t tolerate it.
    3. Diagnose problems to get at their root causes
      • Focus on the “what is” before deciding “what to do about it.”
      • Distinguish proximate causes from root causes.
      • Recognize that knowing what someone (including you) is like will tell yo what you can expect from them.
    4. Design a plan
      • Go back before you go forward.
      • Think about your problem as a set of outcomes produced by a machine
      • Remember that there are typically many paths to achieving your goals.
      • Think your plan as being like a movie script in that you visualize who will do what through time.
      • Write down your plan for everyone to see and to measure your progress against.
      • Recognize that it doesn’t take a lot of time to design a good plan.
    5. Push through to completion
      • Great planners who don’t execute their plans go nowhere.
      • Good work habits are vastly underrated.
      • Establish clear metrics to make certain that you are following your plan.
    6. Remember that weaknesses don’t matter if you find solutions.
      • Look at the patterns of your mistakes and identify at which step in the 5-Step Process you typically fail.
      • Everyone has at least one big thing that stands in the way of their success; find yours and deal with it.

 

Principles: Life Principles (part 2 of 14)

Life Principles: Putting It All Together

In order to have the best life possible, you have to: 1) know what the best decisions are and 2) have the courage to make them.

In Life Principles, I’ve explained some principles that helped me do both of these things. I believe that because the same kinds of things happen over and over again, a relatively few well-thought-out principles will allow you to deal with just about anything that reality throws at you. Where you get these principles from doesn’t matter as much as having them and using them consistently – and that you never stop refining and improving them.

To acquire principles that work, it’s essential that you embrace reality and deal with it well. Don’t fall into the common trap of wishing that reality worked differently than it does or that your own realities were different. Instead, embrace your realities and deal with them effectively. After all, making the most of your circumstances is what life is all about. This includes being transparent with your thoughts and open-mindedly accepting the feedback of others. Doing so will dramatically increase your learning.

Along your journey you will inevitably experience painful failures. It is important to realize that they can either be the impetus that fuels your personal evolution or they can ruin you, depending on how you react to them. I believe that evolution is the greatest force in the universe and that we all evolve in basically the same way. Conceptually, it looks like a series of loops that either lead upward toward constant improvement or remain flat or even trend downward toward ruin. You will determine what your own loops look like.

Your evolutionary process can be described as a 5-Step Process for getting what you want. It consists of setting goals, identifying and not tolerating problems, diagnosing problems, coming up with designs to get around them, and then doing the tasks required. The important thing to remember is that no one can do all the steps well, but that it’s possible to really on others to help. Different people with different abilities working well together create the most powerful machines to produce achievements.

If you’re willing to confront reality, accept the pain that comes wit doing so, and follow the 5-Step Process to drive yourself toward your goals, you’re on the path to success. Yet most people fail to do this because they hold on to bad opinions that could easily be rectified by going above themselves to objectively look down at their situation and weigh what they and others think about it. It’s for that reason I believe you must be radically open-minded.

Our biggest barriers for doing this well are our ego barrier and our blind spot barrier. The ego barrier is our innate desire to be capable and have others recognize us as such. The blind spot barrier is the result of our seeing things through our own subjective lenses; both barriers can prevent us from seeing how things really are. The most important antidote for them is radical open-mindedness, which is motivated by the genuine worry that one might not be seeing one’s choices optimally. It is the ability to effectively explore different points of view and different possibilities without letting your ego or your blinds spots get in your way.

Doing this well requires practicing thoughtful disagreement, which is the process of seeking out brilliant people who disagree with you in order to see things through their eyes and gain a deeper understanding. Doing this will raise your probability of making good decisions and will also give you a fabulous education. If you can learn radical open-mindedness and practice thoughtful disagreement, you’ll radically increase your learning.

Finally, being radically open-minded requires you to have an accurate self-assessment of your own and others’ strengths and weaknesses. This is where understanding something about how the brain works and the different psychometric assessments that can help you discover what your own brain is like comes in. To get the best results out of yourself and others, you must understand that people are wired very differently.

In a nutshell, learning how to make decisions in the best possible way and learning to have the courage to make them comes from a) going after what you want, b) failing and reflecting well through radical open-mindedness, and c) changing/evolving to become ever more capable and less fearful. In the final chapter of this section, Learn How to Make Decisions Effectively, I shared some more granular principles for how to do all of the above and weigh your options in specific situations to determine the right path to follow.

You can of course do all of these things alone, but if you’ve understood anything about the the concept of radical open-mindedness, it should be obvious that going it alone will only take you so far. We all need other sot help us triangulate and get to the best possible decisions – and to help us see our weaknesses objectively and compensate for them. More than anything else, your life is affected by the people around you and how you interact with each other.

Your ability to get what you want when working with others who want the same things is much greater than your ability to get these things by yourself. Yet we have’ talked about how groups should operate to be most effective. That’s what we’ll do in Work Principles.

Work Principles is about people working together. because the power of a group is so much greater than the power of an individual, the principles that follow are likely even more important than those we covered up to this point. In fact, I wrote them first and then wrote Life Principles in order help others make sense of the approach I was implicitly applying in running Bridgwater. My Work Principles are basically the Life Principles you just read, applied to groups. I will show you , principle by principle, how an actual, practical, believability-weighted decision-making system converts independent thinking into effective group decision making. I believe that such a system can work to make any kind of organization – business, government, philanthropic – both more effective and more satisfying to belong to.

Principles (part 1 of 14)

Principles

By: Ray Dalio (2017)

[Pigeonhole] A Practical Principal Book

[Premise] This book is the ‘Operating System’ for Ray Dalio and his firm Bridgewater Capital – the most successful hedge fund in history. He gives a quick background, then details his “Life Principles” which form an operating mentality for his “Work Principles,” Which details how to apply that mentality to an organization.

Chapters

PART I – WHERE I’M COMING FROM

  1. My call to adventure: 1949 – 1967 (5 -10)
  2. Crossing the Threshold: 1967 – 1979 (11 – 26)
  3. My Abyss: 1979 – 1982 (27 – 38)
  4. My Road of Trials: 1983 – 1994 (39 – 66)
  5. The Ultimate Boon: 1995 – 2010 (67 – 90)
  6. Returning the Boon: 2011 – 2015 (91 – 116)
  7. My Last Year and My Greatest Challenge: 2016 – 2017 (117 – 120)
  8. Looking Back from a Higher Level (121 – 131)

PART II – LIFE PRINCIPLES

  1. Embrace Reality and Deal with it (132 – 167)
  2. Use the 5-Step Process to Get What You Want Out of Life (168 – 181)
  3. Be Radically Open-Minded (182 – 203)
  4. Understand That People Are Wired Very Differently (204 – 233)
  5. Learn How to Make Decisions Effectively (234 – 266)
    Life Principles: Putting It All Together (267 – 271)
    Summary and Table of Life Principles (272 – 279)

PART III – WORK PRINCIPLES

Summary and Table of Work Principles (280 – 317)
TO GET THE CULTURE RIGHT … (318 – 321)

  1. Trust in Radical Truth and Radical Transparency (322 – 337)
  2. Cultivate Meaningful Work and Meaningful Relationships (338 – 347)
  3. Create a Culture in Which It Is Okay to Make Mistakes and Unacceptable Not to Learn from Them (348 – 355)
  4. Get and Stay in Sync (356 – 369)
  5. Believability Weight Your Decision Making (370 – 383)
  6. Recognize How to Get Beyond Disagreements (384 – 393)
    TO GET THE PEOPLE RIGHT … (394 – 397)
  7. Remember That the WHO is More Important than the WHAT (398 – 403)
  8. Hire Right, Because the Penalties for Hiring Wrong Are Huge (404 – 419)
  9. Constantly Train, Test, Evaluate, and Sort People (420 – 443)
    TO BUILD AND EVOLVE YOUR MACHINE … (444 – 447)
  10. Manage as Someone Operating a Machine to Achieve a Goal (448 – 471)
  11. Perceive and Don’t Tolerate Problems (472 – 481)
  12. Diagnose Problems to Get at Their Root Causes (482 – 495)
  13. Design Improvements to Your Machine and Get Around Your Problems (496 – 517)
  14. Do What You Set Out to Do (518 – 523)
  15. Use Tools and Protocols to Shape How Work Is Done (524 – 529)
  16. And for Heaven’s Sake, Don’t Overlook Governance! (530 – 538)
    Work Principles: Putting It all Together (539 – 542)

Conclusion (543 – 544)
Appendix: Tools and Protocols for Bridgwater’s Idea Meritocracy (545 – 552)
Bibliography (553 – 554)
Index (555 – 564)
Acknowledgments (565 – 568)
About the Author (569)

[Key Points]

This book is Thick and Dense, but he summarizes his work completely. This digest is actually just a reprint of pages 267 – 317.  This center section of the book lays out a summary for both Life Principles and Work Principles, included each of the major and minor principles discussed in greater detail in the book itself.