Principles: Life and Work

by Ray Dalio

Being effective at thoughtful disagreement requires one to be open-minded (seeing things through the other’s eyes) and assertive (communicating clearly how things look through your eyes) and to flexibly process this information to create learning and adaptation.

Typically they are more inclined to be assertive than open-minded (because it’s easier to convey how they see things than to understand how others do, and also because people tend to have ego attachments to being right) though some people are too willing to accept others’ views at the expense of their own. It’s important to remind people that they have to do both—and to remember that decision making is a two-step process in which one has to take in information as well as decide.

Make it clear who is directing the meeting and whom it is meant to serve. Every meeting should be aimed at achieving someone’s goals; that person is the one responsible for the meeting and decides what they want to get out of it and how they will do so. Meetings without someone clearly responsible run a high risk of being directionless and unproductive.

h. Be careful not to lose personal responsibility via group decision making. Too often groups will make a decision to do something without assigning personal responsibilities, so it is not clear who is supposed to follow up by doing what. Be clear in assigning personal responsibilities.

5.2 Find the most believable people possible who disagree with you and try to understand their reasoning. Having open-minded conversations with believable people who disagree with you is the quickest way to get an education and to increase your probability of being right.

d. Don’t pay as much attention to people’s conclusions as to the reasoning that led them to their conclusions. It is common for conversations to consist of people sharing their conclusions rather than exploring the reasoning that led to those conclusions. As a result, there is an overabundance of confidently expressed bad opinions. e. Inexperienced

Take the Protestants and Catholics. Though both are followers of Christ, some of them have been fighting for hundreds of years, even though many of them are unable to articulate the differences that divide them, and most of those who can articulate the differences realize that they are insignificant relative to the big important things that should bind them together. I once saw a close family have an irrevocable blow-out at a Thanksgiving dinner over who would cut the turkey. Don’t let this narcissism of small differences happen to you. Understand that nobody and nothing is perfect and that you are lucky to have by-and-large excellent relationships. See the big picture.

In picking people for long-term relationships, values are most important, abilities come next, and skills are the least important. Yet most people make the mistake of choosing skills and abilities first and overlooking values. We value people most who have what I call the three C’s: character, common sense, and creativity.

On the other hand, sometimes I see people dealing with each other, especially in groups, without regard for these differences. They are like the parable of the blind men touching different parts of an elephant and arguing about what it is. Just think about how much better it would be if people were open-minded enough to realize that none of them have the complete picture. Both people expressing their own views and those considering others’ views need to take each other’s differences into account. These differences are real, so it’s dumb to pretend they don’t exist.

a. Look for people who have lots of great questions. Smart people are the ones who ask the most thoughtful questions, as opposed to thinking they have all the answers. Great questions are a much better indicator of future success than great answers.

Remember that the only purpose of money is to get you what you want, so think hard about what you value and put it above money. How much would you sell a good relationship for? There’s not enough money in the world to get you to part with a valued relationship.

It’s also not a good thing for you as a manager. Instead of micromanaging, you should be training and testing. Give people your thoughts on how they might approach their decisions, but don’t dictate to them. The most useful thing you can do is to get in sync with them, exploring how they are doing things and why.

The greatest gift you can give someone is the power to be successful. Giving people the opportunity to struggle rather than giving them the things they are struggling for will make them stronger. Compliments are easy to give but they don’t help people stretch. Pointing out someone’s mistakes and weaknesses (so they learn what they need to deal with) is harder and less appreciated, but much more valuable in the long run.

Ultimately, to help people succeed you have to do two things: First let them see their failures so clearly that they are motivated to change them, and then show them how to either change what they are doing or rely on others who are strong where they are weak. While doing the first without the second can be demoralizing to the people you are trying to help, doing them both should be invigorating, especially when they start experiencing the benefits.