The other week, I read Ray Dalio’s book Principles. There were parts that I think were extremely insightful, but some other aspects that I thought less effective. I recently worked at a company that tried to implement Dalio’s principles, with mixed success, which I think underlies my view of this book.
Let’s start by talking about things I enjoyed about this book. This book was well organized, road-mapped often, and avoided ambiguity. Clear and effective writing makes ideas contagious, and I might just be coming down with the cold. The first part of the book, Ray’s personal life principles, was the most interesting to me. Particularly, hearing how he learned about how the livestock industry worked on a deep level, and the importance of timing in making his decisions. I think this gets to the deeper point that truth matters, and truth must be discerned through systematic thinking. Integrating truth and your hopes about the future is a sure pathway to success, and although maybe apparent, I appreciate him echoing this sentiment.
Probably the most insightful element in his book was seeing the corporation and business as an extension of nature. Regular discussions of the evolutionary process and virtuous and vicious cycles were interesting and novel, though I’m not sure how rigorous and extendable these ideas are, in general. Regardless, I think he hits it on the head that growth requires being uncomfortable, but it’s the only safe pathway overall.
A final thing I liked about the book was actionable insights into how to go about creating a successful business. I liked his demonstrations of tools that end up supporting the principles. The three tools I thought most interesting were the introduction of baseball card employee information, the process for reviewing mistakes, and weighted believability scores when assessing disagreements. Other things he pointed out, like avoiding nepotism, recognizing that individuals have different proclivities for success in specific roles, and giving candid feedback, while true and important, are not especially innovative.
It’s very clear from this book that Ray likes to think in terms of how a system operates, and the rules that determine the system working. In this way, Ray divorces outcome from process, and creates what I’ll dub a ‘decision machine’, one which aggregates the judgement of trustworthy believable people, to lead to the best possible results.
I think the first major challenge with this book is that it is unclear how one creates such a culture in an already established company with differing values, which I think is important to these general principles. This is apparent in the healthcare technology sector where tools like transparency surrounding mistakes doesn’t scale up since specific shortcomings, especially with multiple people reviewing to cover themselves from blame happens, and it’s unclear why higher-ups would take a risk on their careers in doing so. Similarly, candid feedback and believability weighting, while aspirational goals require lots of work to allow for feedback to flow up as well as down.
The other thing I didn’t like about this book is that frankly it felt a little repetitive on the ‘tell the truth’ schtick, and didn’t go as deep into the nature analogy as I would like. Having virtuous people is great and all, but how should an organization fill its niche? Do all great organizations have similar ingredients of people? I think moving away from his organization’s specific experiences would be insightful. Are all types of growth as important?
Overall, I think this was a helpful and interesting read, and I’m glad I took the time to finish it.
Isadore Johnson's Website 