principles

Author: xchen87

_posts/2025-02-15-principles-ray-dalio.md

@@ -0,0 +1,64 @@
+---
+title: Principles
+date: 2025-02-09 14:34 +0800
+categories: [BookReview]
+tags: [BookReview]
+---
+
+![CoverImage]({{ site.url }}/{{ site.baseurl }}/assets/img/principles_ray_dalio.jpg)
+Author: Ray Dalio
+
+## Book Notes
+> I urge you to be curious enough to want to understand how the people who see things differently from you came to see them that way.
+
+> I believe that all organizations basically have two types of people: those who work to be part of a mission, and those who work for a paycheck.
+
+> Whether you own a hotel, run a technology company, or do anthing else, your business produces a return stream. Having a few good uncorrelated return stream is better than having just one, and knowing how to combine return streams is even more effective than being able to choose good ones (though of course you have to do both).
+
+![CoverImage]({{ site.url }}/{{ site.baseurl }}/assets/img/principles_the_holy_grail_portfolio.png)
+
+> Having a process that ensures problems are brought to the surface, and their root causes diagnosed, assures that continual improvements occur.
+> For that reason I insisted that an issue log be adopted throughout Bridgewater. My rule was simple: If something went badly, you had to put it to the log, characterize its severity, and make clear who was responsible for it. If a mistake happened and you logged it, you were okey. If you didn't log it, you would be in deep trouble. This way managers had problems brought to them, which was worlds better than having to seek them out.
+
+Everybody makes mistakes, if you punish severly for the person that made a mistake or even fire him, then the chances are other folks would tend toward hiding their mistakes other than exposing it. Eventually this leads to bad outcomes for the team long term. Ray's solution of an open error log is a great way to handle this. This will surely generate a lot of discomfort and conflict still, but once the culture is there in the team it'll be great for long term. Or put it another way, it's ok to make mistakes, it's unacceptable to not learn from it.
+
+> Heros inevitablely experience at least one very big failure that tests whether they have the resilience to come back and fight smarter and with more determination. If they do, they undergo a change in which they experience the fear that protects them, without losing the aggressiveness that propels them forward.
+
+> In an idea meritocracy, openness is a responsibility; you not only have the priviledge to speak up and "fight for right" but are obliged to do so.
+
+> Be loyal to the common misson and not to anyone who is not operating consistently with it.
+
+I've seen the oppsite situations happen, and the ugly effect it causes in black sesame, building a culture where each one is loyal to the common mission is critical, regardless of how hard it is to achieve.
+
+> Be open-minded and assertive at the same time. Most people have problem with this, typically they are more rinclined to be assertive than open-minded though some people are too willing to accept others' views at the expense of their own. It helps to remind people that those who change their minds are the biggest winners because they learned something, whereas those who stubbornly refuse to see the truth are losers.
+
+> Distinguish open-minded people from closed-minded people. Don't have anything to do with close-minded people. No matter how much they know, close-minded people will waste your time. If you must deal with them, recognize that there can be no helping them until they open their mind.
+
+> Watch out for people who think it's embarrassing not to know. They are likely to be more concerned with appearances than actually achieving the goal; this can lead to ruin over time.
+
+Oh this happens so often and to so many people, including myself in so many different situations. Even though most people know this is not a good trait, it's hard to fight the natural tendency to not be looking stupid. But it is must-change behavior for sure.
+
+> Disagreeing must be done efficiently. Know when to stop debating and move on to agreeing about what should be done. It's more important to do big things well than to do the small things perfectly.
+
+Another great point made here, is that the company should have a system, or principles set in place, to handle disagreement, just like how courts handle disputes based on law. Because you can't just encourage people to think independently and fight for what they believe is true. You also have to provide them with a way to get past their disagreements and move forward. 
+
+> Don't leave important conflicts unresolved.
+
+> Once a decision is made, everyone should get behind it even though individuals may still disagree.
+
+This is not to say people should pretend they like the decision if they don't, or that the matter in question can't be revisited at a future date. But in order to be effective, all groups that work together have to operate with protocols that allow time for disagreements to be explored, but in which dissenting minority parties recognize that group cohesion supersedes their individual desires once they have been overruled.
+
+> Remember that the WHO is more important than the WHAT
+
+Hiring the best fit people for the roles are the secrets of all successful companies.
+1. Remember the goal.
+2. Give the goal to people who can achieve it or tell them what to do to achieve it.
+3. Hold them accountable.
+4. If they still can't do the job after you've trained them and given them time to learn, get rid of them.
+
+> Remember that for every case you deal with, your approach should have two purposes. 1) to move you closer to your goal, and 2) to train and test your machine (i.e. your people and your design). The second purpose is more important than the first because it is how you build a solid organization that works well in all cases. Most people focus more on the first purpose, which is big mistake.
+
+## Reflections
+
+I find reading this book both fun and insightful. Even though the book is titled "Principles" and lots of specific life and work principles are specifically laid out and explained, and is probably what the book is mostly focused on, I enjoyed the first part of the book more, where Ray told the story for where he came from and the motivations behind writing the book. The self-written mini biography for both Ray and the Bridgewater as a company was intriguing and inspiring to read.\
+With that as the background, lots of principles came natural and I can quickly made sense of them, especially when attempting to put my feet inside Ray's shoes. For the many many specific principles that were laid out in second part of book, some I found very insightful which I recorded above, others are still meaningful but they are more on the common sense side, which fall more in the "we all know it, but it still takes tremendous efforts to achieve" type of things. One cannot expect to be executing those principles well just by reading, even remembing them fully the next day would be challenging. But it would be wise to have the book as a go-to when there are doubts in life or in work, and the book certainly warrents itself rights to be revisited many many times later on.