Principles – Dalio

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I respect Ray Dalio’s humility and honesty.

You get the sense that he is an open, “enlightened” man who has seen the greater pattern in the world and lifted himself a little further away from the bopping of everyday life.

Part I

  • The quality of our lives is based on the quality of our decisions.
  • Imagine a room with just 6 people in it (A,B,C,D,E,F). A has $1000 and nobody else has any money. B decides to operate as a “bank”. A gives B his $1000. Blends 90% (regulation) of it to C to start a business. C buys $900 worth of goods from D for his business. D puts his 900 in the bank (B). B does the same with E, etc, etc. Through lending, $1000 can result in over $9000 worth of economic activity.
  • The art of life is learning how to struggle well.

Part II

  • Ignorance and Ego – The two fundamental challenges man has to face in life. Understanding how these two things prevent you from achieving everything in life is a form of enlightenment. It allows you to look down on your life, as an obstacle course constructed from these two elements and navigate your way through.
  • Ignorance and ego!
  • Own your outcomes – whatever life brings you, if you own the outcomes for your decisions and part in everything, then you will be more likely to make better decisions in the future.
  • Focus on cultivating your rulesets intentionally – The quality of your life is determined by the quality of your decisions. Your decisions are only as good as the rulesets (concepts) that it can choose from. Cultivate your ruleset to improve your decisions.
  • Radical open mindedness – requires you to replace your obsession with being right, for the joy of learning.
  • I like to think that I am open minded but when you look at the definitions put forward by Dalio, I’m actually pretty close-minded. (Starting sentences with “I could be wrong”, cutting off other people from talking, lack a deep sense of humility that comes from the empathy learned from crashing)
  • I think that I am right all the time and rarely really give people enough time to express their opinion before making a judgement.
  • Implement the 2 minute rule, where I give people 2 minutes to effectively communicate their idea/opinion.
  • Passion for truth: A big thing that keeps coming through in Dalio’s principles is that beyond anything else he is trying to get people to have an unwaivering passion for truth. Not for being right, but for finding the most accurate view of reality. This means, among other things, dropping your ego, being objective, being open minded and capitalizing on other people’s knowledge/opinions.
  • “Each neuron connects with on average 10 thousand other neighboring neurons” – Incognito

Part III

  • Meaningful work and relationships → inspires the right people to build the right culture → which creates outcomes that match the goals → which means long-term success.
  • Everything is about increasing your probabilities of making good decisions.
  • Thoughtful disagreements raise your odds of making good decisions.
  • Design your organisation as a machine that takes inputs, has steps, and should produce outcomes.
  • Problems need to be moved along the spectrum of “not identified, identified not planned solution, identified and planned, identified planned and solved.”
  • Don’t just solve problems when they occur, use them to diagnose what is wrong with your machine and improve the design.
  • Believable person – someone with skills and experience in a domain which give weight to their statements. People respect believable people.
  • 5 step process: goals → problems → diagnosis → design → doing

Quotes

  • “Time is like a river that carries us forward into encounters with reality that require us to make decisions. We can’t stop our movement down this river and we can’t avoid those encounters. We can only approach them in the best possible way.”
  • “For me, great is better than terrible, and terrible is better than mediocre, because terrible at least gives life flavor.”
  • “gradually learned that prices reflect people’s expectations, so they go up when actual results are better than expected and they go down when they are worse than expected. And most people tend to be biased by their recent experiences.”
  • “The message that reality was conveying to me was “You better make sense of what happened to other people in other times and other places because if you don’t you won’t know if these things can happen to you and, if they do, you won’t know how to deal with them.””
  • “If you are not aggressive, you are not going to make money, and if you are not defensive, you are not going to keep money.”
  • “Think about it: It’s senseless to have making money as your goal as money has no intrinsic value—its value comes from what it can buy, and it can’t buy everything. It’s smarter to start with what you really want, which are your real goals, and then work back to what you need to attain them. Money will be one of the things you need, but it’s not the only one and certainly not the most important one once you get past having the amount you need to get what you really want.”
  • “In retrospect, my crash was one of the best things that ever happened to me because it gave me the humility I needed to balance my aggressiveness.”
  • “In other words, I just want to be right—I don’t care if the right answer comes from me. So I learned to be radically open-minded to allow others to point out what I might be missing.”
  • “Seek out the smartest people who disagreed with me so I could try to understand their reasoning. 2. Know when not to have an opinion. 3. Develop, test, and systemize timeless and universal principles. 4. Balance risks in ways that keep the big upside while reducing the downside.”
  • ““theoretically . . . if there was a computer that could hold all of the world’s facts and if it was perfectly programmed to mathematically express all of the relationships between all of the world’s parts, the future could be perfectly foretold.””
  • “I believe one of the most valuable things you can do to improve your decision making is to think through your principles for making decisions, write them out in both words and computer algorithms, back-test them if possible, and use them on a real-time basis to run in parallel with your brain’s decision making.”
  • “Maturity is the ability to reject good alternatives in order to pursue even better ones.”
  • “for what I thought was best, and I wanted them to do so as well. When I thought someone did something stupid, I said so and I expected them to tell me when I did something stupid. Each of us would be better for it.”
  • “Because most people are more emotional than logical, they tend to overreact to short-term results; they give up and sell low when times are bad and buy too high when times are good.”
  • “Making a handful of good uncorrelated bets that are balanced and leveraged well is the surest way of having a lot of upside without being exposed to unacceptable downside.”
  • “1. Put our honest thoughts out on the table, 2. Have thoughtful disagreements in which people are willing to shift their opinions as they learn, and 3. Have agreed-upon ways of deciding (e.g., voting, having clear authorities) if disagreements remain so that we can move beyond them without resentments.”
  • “There is nothing to prompt learning like pain and necessity,”
  • “the greatest success you can have as the person in charge is to orchestrate others to do things well without you. A step below that is doing things well yourself, and worst of all is doing things poorly yourself.”
  • ““Unattainable goals appeal to heroes,” he once told me. “Capable people are those who sit there worrying about the future. The unwise are those who worry about nothing. If conflicts got resolved before they became acute, there wouldn’t be any heroes.”
  • “Simply put, governance is the system of checks and balances ensuring that an organization will be stronger than whoever happens to be leading it at any one time.”
  • “Instead of feeling frustrated or overwhelmed, I saw pain as nature’s reminder that there is something important for me to learn.”
  • “In my early years, I looked up to extraordinarily successful people, thinking that they were successful because they were extraordinary. After I got to know such people personally, I realized that all of them—like me, like everyone—make mistakes, struggle with their weaknesses, and don’t feel that they are particularly special or great. They are no happier than the rest of us, and they struggle just as much or more than average folks. Even after they surpass their wildest dreams, they still experience more struggle than glory. This has certainly been true for me. While I surpassed my wildest dreams decades ago, I am still struggling today. In time, I realized that the satisfaction of success doesn’t come from achieving your goals, but from struggling well.”
  • “my assessment is that the incremental benefits of having a lot and being on top are not nearly as great as most people think. Having the basics—a good bed to sleep in, good relationships, good food, and good sex—is most important, and those things don’t get much better when you have a lot of money or much worse when you have less.”
  • “cannot say that having an intense life filled with accomplishments is better than having a relaxed life filled with savoring, though I can say that being strong is better than being weak, and that struggling gives one strength.”
  • “What I have seen is that the happiest people discover their own nature and match their life to it.”
  • “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.”
  • “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.”
  • “Idealists who are not well grounded in reality create problems, not progress.”
  • “Truth—or, more precisely, an accurate understanding of reality—is the essential foundation for any good outcome.”
  • “Learning is the product of a continuous real-time feedback loop in which we make decisions, see their outcomes, and improve our understanding of reality as a result.”
  • “Embracing radical truth and radical transparency will bring more meaningful work and more meaningful relationships.”
  • “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. 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. That’s because you will regularly encounter situations that will force you to make such choices.”
  • “Though most people think that they are striving to get the things (toys, bigger houses, money, status, etc.) that will make them happy, for most people those things don’t supply anywhere near the long-term satisfaction that getting better at something does.”
  • “Pain + Reflection = Progress.”
  • “The challenges you face will test and strengthen you. If you’re not failing, you’re not pushing your limits, and if you’re not pushing your limits, you’re not maximizing your potential.”
  • “Identifying, accepting, and learning how to deal with your weaknesses, • Preferring that the people around you be honest with you rather than keep their negative thoughts about you to themselves, and • Being yourself rather than having to pretend to be strong where you are weak.”
  • “At such times, you will be in pain and might think that you don’t have the strength to go on. You almost always do, however; your ultimate success will depend on you realizing that fact, even though it might not seem that way at the moment.”
  • “Whatever circumstances life brings you, you will be more likely to succeed and find happiness if you take responsibility for making your decisions well instead of complaining about things being beyond your control.”
  • “Distinguish between you as the designer of your machine and you as a worker with your machine. One of the hardest things for people to do is to objectively look down”
  • “Successful people are those who can go above themselves to see things objectively and manage those things to shape change. They can take in the perspectives of others instead of being trapped in their own heads with their own biases.”
  • “if you as the designer/manager discover that you as the worker can’t do something well, you need to fire yourself as the worker and get a good replacement, while staying in the role of designer/manager of your own life. You shouldn’t be upset if you find out that you’re bad at something—you should be happy that you found out, because knowing that and dealing with it will improve your chances of getting what you want.”
  • “When encountering your weaknesses you have four choices: 1. You can deny them (which is what most people do). 2. You can accept them and work at them in order to try to convert them into strengths (which might or might not work depending on your ability to change). 3. You can accept your weaknesses and find ways around them. 4. Or, you can change what you are going after.”
  • “1. Have clear goals. 2. Identify and don’t tolerate the problems that stand in the way of your achieving those goals. 3. Accurately diagnose the problems to get at their root causes. 4. Design plans that will get you around them. 5. Do what’s necessary to push these designs through to results.”
  • “Don’t mistake the trappings of success for success itself.”
  • “When a problem stems from your own lack of talent or skill, most people feel shame. Get over it. I cannot emphasize this enough: Acknowledging your weaknesses is not the same as surrendering to them. It’s the first step toward overcoming them.”
  • “Proximate causes are typically the actions (or lack of actions) that lead to problems, so they are described with verbs (I missed the train because I didn’t check the train schedule). Root causes run much deeper and they are typically described with adjectives (I didn’t check the train schedule because I am forgetful). You can only truly solve your problems by removing their root causes, and to do that, you must distinguish the symptoms from the disease.”
  • “Remember that there are typically many paths to achieving your goals. You only need to find one that works.”
  • “Everyone has at least one big thing that stands in the way of their success; find yours and deal with it.”
  • “The two biggest barriers to good decision making are your ego and your blind spots. Together, they make it difficult for you to objectively see what is true about you and your circumstances and to make the best possible decisions by getting the most out of others.”
  • “Let’s look at what tends to happen when someone disagrees with you and asks you to explain your thinking. Because you are programmed to view such challenges as attacks, you get angry, even though it would be more logical for you to be interested in the other person’s perspective, especially if they are intelligent. When you try to explain your behavior, your explanations don’t make any sense. That’s because your lower-level you is trying to speak through your upper-level you. Your deep-seated, hidden motivations are in control, so it is impossible for you to logically explain what “you” are doing.”
  • “If you’re like most people, you have no clue how other people see things and aren’t good at seeking to understand what they are thinking, because you’re too preoccupied with telling them what you yourself think is correct. In other words, you are closed-minded; you presume too much. This closed-mindedness is terribly costly; it causes you to miss out on all sorts of wonderful possibilities and dangerous threats that other people might be showing you—and it blocks criticism that could be constructive and even lifesaving.”
  • “It requires you to replace your attachment to always being right with the joy of learning what’s true.”
  • “Don’t worry about looking good; worry about achieving your goal.”
  • “Recognize that to gain the perspective that comes from seeing things through another’s eyes, you must suspend judgment for a time—only by empathizing can you properly evaluate another point of view. Open-mindedness”
  • “Be clear on whether you are arguing or seeking to understand, and think about which is most appropriate based on your and others’ believability.”
  • “Closed-minded people say things like “I could be wrong . . . but here’s my opinion.” This is a classic cue I hear all the time. It’s often a perfunctory gesture that allows people to hold their own opinion while convincing themselves that they are being open-minded. If your statement starts with “I could be wrong” or “I’m not believable,” you should probably follow it with a question and not an assertion. Open-minded people know when to make statements and when to ask questions.”
  • “Closed-minded people block others from speaking. If it seems like someone isn’t leaving space for the other person in a conversation, it’s possible they are blocking. To get around blocking, enforce the “two-minute rule” I mentioned earlier. Open-minded people are always more interested in listening than in speaking; they encourage others to voice their views.”
  • “Closed-minded people lack a deep sense of humility. Humility typically comes from an experience of crashing, which leads to an enlightened focus on knowing what one doesn’t know. Open-minded people approach everything with a deep-seated fear that they may be wrong.”
  • ““Individual selection [which] prompted sin and group selection [which] promoted virtue.”
  • “As with animals, many of our decision-making drivers are below the surface. An animal doesn’t “decide” to fly or hunt or sleep or fight in the way that we go about making many of our own choices of what to do—it simply follows the instructions that come from the subconscious parts of its brain. These”
  • “Many people only see the conscious mind and aren’t aware of the benefits of connecting it to the subconscious. They believe that the way to accomplish more is to cram more into the conscious mind and make it work harder, but this is often counterproductive.”
  • “Train your “lower-level you” with kindness and persistence to build the right habits. I used to think that the upper-level you needed to fight with the lower-level you to gain control, but over time I’ve learned that it is more effective to train that subconscious, emotional you the same way you would teach a child to behave the way you would like him or her to behave—with loving kindness and persistence so that the right habits are acquired.”
  • “everyone has strengths and weaknesses, and everyone has an important role to play in life. Nature made everything and everyone for a purpose. The courage that’s needed the most isn’t the kind that drives you to prevail over others, but the kind that allows you to be true to your truest self, no matter what other people want you to be.”
  • “Getting the right people in the right roles in support of your goal is the key to succeeding at whatever you choose to accomplish.”
  • “New is overvalued relative to great. For example, when choosing which movie to watch or what book to read, are you drawn to proven classics or the newest big thing? In my opinion, it is smarter to choose the great over the new.”
  • “either learn it or have someone close to you who can translate for you. Your children and their peers must learn to speak this language because it will soon be as important or more important than any other language. By developing”
  • “embrace reality and deal with it well.”
  • “Our biggest barriers for doing this well are our ego barrier and our blind spot barrier.” (Ego and ignorance)
  • “An organization is a machine consisting of two major parts: culture and people. Each influences the other, because the people who make up an organization determine the kind of culture it has, and the culture of the organization determines the kinds of people who fit”
  • “nothing is more important or more difficult than to get the culture and the people right. Whatever successes we’ve had at Bridgewater were the result of doing that well”
  • “Having clear processes for resolving disagreements efficiently and clearly is essential for business partnerships, marriages, and all other forms of partnership.”
  • “Money is a byproduct of excellence, not a goal. Our overriding objective is excellence and constant improvement at Bridgewater.”
  • “Bob Kegan, who has studied Bridgewater, likes to say, in most companies people are doing two jobs: their actual job and the job of managing others’ impressions of how they’re doing their job.”
  • “your organization is a machine made up of culture and people that will interact to produce outcomes, and those outcomes will provide feedback about how well your organization is working. Learning from this feedback should lead you to modify the culture and the people so your organizational machine improves.”
  • “Work is either 1) a job you do to earn the money to pay for the life you want to have or 2) what you do to achieve your mission, or some mix of the two. I urge you to make it as much 2) as possible, recognizing the value of 1).”
  • “You have to work in a culture that suits you. That’s fundamental to your happiness and your effectiveness. You also must work in a culture that is effective in producing great outcomes, because if you don’t, you won’t get the psychic and material rewards that keep you motivated.”
  • “It’s a real asset that people know they can trust what we say.”
  • “Judging one person by a different set of rules than another is an insidious form of corruption that undermines the meritocracy.”
  • “Create an environment in which everyone has the right to understand what makes sense and no one has the right to hold a critical opinion without speaking up.”
  • “If we were handling things well, our transparency would make that clear (provided, of course, that all parties are reasonable, which isn’t something you can always take for granted), and if we were handling things badly, our transparency would ensure that we would get what we deserve, which, in the long run, would be good for us.”
  • “Make sure people give more consideration to others than they demand for themselves. This is a requirement.”
  • “Make sure that people understand the difference between fairness and generosity.”
  • “we are generous with people (and I am personally generous), but we feel no obligation to be measured and equal in our generosity.”
  • “Generosity is good and entitlement is bad, and they can easily be confused, so be crystal clear on which is which.”
  • “Everyone makes mistakes. The main difference is that successful people learn from them and unsuccessful people don’t.”
  • “It seems to me that if you look back on yourself a year ago and aren’t shocked by how stupid you were, you haven’t learned much.”
  • “It seems to me that the best students in school tend to be the worst at learning from their mistakes, because they have been conditioned to associate mistakes with failure instead of opportunity. This is a major impediment to their progress. Intelligent people who embrace their mistakes and weaknesses substantially outperform their peers who have the same abilities but bigger ego barriers.”
  • “If you don’t mind being wrong on the way to being right you’ll learn a lot—and increase your effectiveness. But if you can’t tolerate being wrong, you won’t grow, you’ll make yourself and everyone around you miserable, and your work environment will be marked by petty backbiting and malevolent barbs rather than by a healthy, honest search for truth.”
  • “Don’t worry about looking good—worry about achieving your goals.”
  • “Get over “blame” and “credit” and get on with “accurate” and “inaccurate.” Worrying about “blame” and “credit” or “positive” and a“negative” feedback impedes the iterative process that is essential to learning.”
  • “Be self-reflective and make sure your people are self-reflective.”
  • “the most fundamental principle for getting in sync, which is that people must be open-minded and assertive at the same time.”
  • “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.”
  • “Watch out for people who think it’s embarrassing not to know.”
  • “Worry more about substance than style.”
  • “If it is your meeting to run, manage the conversation.”
  • “Be careful not to lose personal responsibility via group decision making.”
  • “Utilize the “two-minute rule” to avoid persistent interruptions.”
  • “Watch out for assertive “fast talkers.” Fast talkers are people who articulately and assertively say things faster than they can be assessed as a way of pushing their agenda past other people’s examination or objections. Fast talking can be especially effective when it’s used against people worried about appearing stupid. Don’t be one of those people. Recognize that it’s your responsibility to make sense of things and don’t move on until you do. If you’re feeling pressured, say something like “Sorry for being stupid, but I’m going to need to slow you down so I can make sense of what you’re saying.” Then ask your questions. All of them.”
  • “1+1=3. Two people who collaborate well will be about three times as effective as each of them operating independently,”
  • “to 5 is more than 20. Three to five smart, conceptual people seeking the right answers in an open-minded way will generally lead to the best answers.”
  • “The most believable opinions are those of people who 1) have repeatedly and successfully accomplished the thing in question, and 2) have demonstrated that they can logically explain the cause-effect relationships behind their conclusions.”
  • “Remember that everyone has opinions and they are often bad. Opinions are easy to produce; everyone has plenty of them and most people are eager to share them—even to fight for them. Unfortunately many are worthless or even harmful, including a lot of your own.”
  • “Find the most believable people possible who disagree with you and try to understand their reasoning.”
  • “Remember that believable opinions are most likely to come from people 1) who have successfully accomplished the thing in question at least three times, and 2) who have great explanations of the cause-effect relationships that lead them to their conclusions. Treat those who have neither as not believable, those who have one as somewhat believable, and those who have both as the most believable. Be especially wary of those who comment from the stands without having played on the field themselves and who don’t have good logic, as they are dangerous to themselves and others.”
  • “The ultimate goal of independent thinking and open debate is to provide the decision maker with alternative perspectives. It doesn’t mean that decision-making authority is transitioned to those who are probing them.”
  • “See things from the higher level. You are expected to go to the higher level and look down on yourself and others as part of a system. In other words, you must get out of your own head, consider your views as just some among many, and look down on the full array of points of view to assess them in an idea-meritocratic way rather than just in your own possessive way.”
  • “A culture and its people are symbiotic—the culture attracts certain kinds of people and the people in turn either reinforce or evolve the culture based on their values and what they’re like.”
  • “At a high level, we look for people who think independently, argue open-mindedly and assertively, and above all else value the intense pursuit of truth and excellence, and through it, the rapid improvement of themselves and the organization.”
  • “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.”
  • “Since at Bridgewater the key shared values that maintain our culture are meaningful work and meaningful relationships, radical truth and radical transparency, an open-minded willingness to explore harsh realities including one’s own weaknesses, a sense of ownership, a drive for excellence, and the willingness to do the good but difficult things, we look for highly capable people who deeply want all of those things.”
  • “Don’t use your pull to get someone a job. It is unacceptable to use your personal influence to help someone get a job because doing so undermines the meritocracy. It’s not good for the job seeker, because it conveys they did not really earn it; it is not good for the person doing the hiring, because it undermines their authority; and it is not good for you because it demonstrates you will compromise merit for friends. It is an insidious form of corruption and it must not be tolerated.”
  • “Beware of the impractical idealist. Idealistic people who have moralistic notions about how people should behave without understanding how people really do behave do more harm than good.”
  • “impractical idealists are dangerous and destructive, whereas practical idealists make the world a better place. To be practical one needs to be a realist—to know where people’s interests lie and how to design machines that produce results, as well as metrics that measure those benefits in relation to the costs.”
  • “Great questions are a much better indicator of future success than great answers.”
  • “Remember that most people are happiest when they are improving and doing the things that suit them naturally and help them advance.”
  • “Every leader must decide between 1) getting rid of liked but incapable people to achieve their goals and 2) keeping the nice but incapable people and not achieving their goals.”
  • “Evaluate accurately, not kindly.”
  • “Know that most everyone thinks that what they did, and what they are doing, is much more important than it really is.”
  • “Don’t hide your observations about people.”
  • “Your reports have to believe that you’re not their enemy—that your sole goal is to move toward the truth; that you are trying to help them and so will not enable their self-deception,”
  • “weakness that is due to a lack of experience or training can be fixed, while a weakness that is due to a lack of ability can’t be. Failing to distinguish between these causes is a common mistake among managers, because managers are often reluctant to appear unkind or judgmental.”
  • “Train, guardrail, or remove people; don’t rehabilitate them.”
  • “Remember that if you are expecting people to be much better in the near future than they have been in the past, you are probably making a serious mistake.”
  • “Be willing to “shoot the people you love.””
  • “The best way to do it is to “love the people you shoot”—do it with consideration and in a way that helps them.”
  • “Most people get caught up in the blizzard of things coming at them. In contrast, successful people get above the blizzard so they can see the causes and effects at play.”
  • “When a problem occurs, conduct the discussion at two levels: 1) the machine level (why that outcome was produced) and 2) the case-at-hand level (what to do about it). Don’t”
  • “Great managers orchestrate rather than do. Like the conductor of an orchestra, they do not play an instrument, but direct their people so that they play beautifully together.”
  • “Clearly assign responsibilities.”
  • “I don’t use the word “leadership” to describe what I do or what I think is good because I don’t believe that what most people think of as “good leadership” is effective. Most people think a good leader is a strong person who engenders confidence in others and motivates them to follow him/her, with the emphasis on “follow.” The stereotypical leader often sees questioning and disagreement as threatening and prefers people do what they’re told. As an extension of this paradigm, the leader bears the main burden of decision making. But because such leaders are never as all-knowing as they try to appear, disenchantment and even anger tends to set in. That’s why people who once loved their charismatic leaders often want to get rid of them.”
  • “The most effective leaders work to 1) open-mindedly seek out the best answers and 2) bring others along as part of that discovery process.”
  • “If you want to be followed, either for egotistical reasons or because you believe it more expedient to operate that way, you will pay a heavy price in the long run.”
  • “Watch out for people who confuse goals and tasks, because if they can’t make that distinction, you can’t trust them with responsibilities.”
  • “Every problem you find is an opportunity to improve your machine.”
  • “Beware of group-think: The fact that no one seems concerned doesn’t mean nothing is wrong.”
  • “Be very specific about problems; don’t start with generalizations.”
  • “The most common mistake I see people make is dealing with their problems as one-offs rather than using them to diagnose how their machine is working so that they can improve it. They”
  • “Remember that a root cause is not an action but a reason. Root causes are described in adjectives, not verbs,”
  • “Most problems happen for one of two reasons: 1) It isn’t clear who the Responsible Party is, or 2) The Responsible Party isn’t handling his/her responsibilities well.”
  • “Systemize your principles and how they will be implemented. If you have good principles that guide you from your values to your day-to-day decisions but you don’t have a systematic way of making sure they’re regularly applied, they’re not of much use.”
  • “Put yourself in the position of pain for a while so that you gain a richer understanding of what you’re designing for.”
  • “Consider second- and third-order consequences, not just first-order ones.”
  • “Understand the power of the “cleansing storm.” In nature, cleansing storms are big infrequent events that clear out all the overgrowth that’s accumulated during good times. Forests need these storms to be healthy—without them, there would be more weak trees and a buildup of overgrowth that stifles other growth. The same is true for companies. Bad times that force cutbacks so only the strongest and most essential employees (or companies) survive are inevitable and can be great, even though they seem terrible at the time.”
  • “Remember that everyone must be overseen by a believable person who has high standards. Without”
  • “For example, the big-picture visionary should be responsible for goal setting, the taste tester should be assigned the job of identifying and not tolerating problems, the logical detective who doesn’t mind probing people should be the diagnoser, the imaginative designer should craft the plan to make the improvements, and the reliable taskmaster should make sure the plan gets executed.”
  • “Use “double-do” rather than “double-check” to make sure mission-critical tasks are done correctly.”
  • “Keep your strategic vision the same while making appropriate tactical changes as circumstances dictate.”
  • “Use “public hangings” to deter bad behavior.”
  • “Remember that almost everything will take more time and cost more money than you expect.”

sebastiankade

Sebastian Kade, Founder of Sumry and Author of Living Happiness, is a software designer and full-stack engineer. He writes thought-provoking articles every now and then on sebastiankade.com

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