Whatever success I’ve had in life has had more to do with my knowing how to deal with my not knowing than anything I know. The most important thing I learned is an approach to life based on principles that helps me find out what’s true and what to do about it. (Location 63)

Tags: principles

Note: Being able to deal with what you dont know is great life skill

Principles are fundamental truths that serve as the foundations for behavior that gets you what you want out of life. They can be applied again and again in similar situations to help you achieve your goals. (Location 68)

Tags: issue4, principles

classify these situations into types and have good principles for dealing with them, we will make better decisions more quickly and have better lives as a result. Having a good set of principles is like having a good collection of recipes for success. (Location 71)

Tags: issue4

Note: Principles are recipies for success

you can think for yourself while being open-minded in a clearheaded way to find out what is best for you to do, and if you can summon up the courage to do it, you will make the most of your life. (Location 90)

Tags: be different

Note: Principle one - think for yoursef

I believe that the key to success lies in knowing how to both strive for a lot and fail well. By failing well, I mean being able to experience painful failures that provide big learnings without failing badly enough to get knocked out of the game. (Location 113)

Tags: failure, goals

Note: Aim high and fail well

The most important thing is that you develop your own principles and ideally write them down, especially if you are working with others. (Location 143)

Note: Write down your own principles

Ask yourself what you want, seek out examples of other people who got what they wanted, and try to discern the cause-and-effect patterns behind their achievements so you can apply them to help you achieve your own goals. (Location 204)

Tags: role model

Note: Seek out examples of people who got what they wanted

Thoreau: “If a man does not keep pace with his companions, perhaps it is because he hears a different drummer. Let him step to the music which he hears, however measured or far away.” (Location 262)

Tags: #newsletter, be different

Note: .bedifferent

“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.” (Location 332)

Tags: history

Note: Learn from history

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. (Location 450)

Tags: goals, money

Note: Dont set money as your main goal

I learned a great fear of being wrong that shifted my mind-set from thinking “I’m right” to asking myself “How do I know I’m right?” And I saw clearly that the best way to answer this question is by finding other independent thinkers who are on the same mission as me and who see things differently from me. By engaging them in thoughtful disagreement, I’d be able to understand their reasoning and have them stress-test mine. That way, we can all raise our probability of being right. (Location 619)

Tags: openminded

Note: Seek out others who see things differently and can stress test your ideas

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. (Location 625)

Tags: principles

Note: .principles

what was most important wasn’t knowing the future—it was knowing how to react appropriately to the information available at each point in time. (Location 670)

Note: Knowing how to react with the information given is important

I learned that if you work hard and creatively, you can have just about anything you want, but not everything you want. Maturity is the ability to reject good alternatives in order to pursue even better ones. (Location 796)

Tags: Prioritisation, prioritisation

Note: .Prioritisation You cant chase everything

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. You will find that interesting and invaluable, and the richer perspective you gain will help you decide what you should do. (Location 833)

Note: Explore why others think differently to you and how they came to think that way

bad times coupled with good reflections provide some of the best lessons, and not just about business but also about relationships. One has many more supposed friends when one is up than when one is down, because most people like to be with winners and shun losers. True friends are the opposite. (Location 890)

Tags: learning

Note: bad times coupled with periods of reflection provide some of the best lessons

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. (Location 954)

Tags: investing

Note: .investing

Getting a lot of attention for being successful is a bad position to be in. Australians call it the “tall poppy syndrome,” because the tallest poppies in a field are the ones most likely to have their heads whacked off. (Location 1362)

Note: Getting attention for being successful is bad

They are all independent thinkers who do not let anything or anyone stand in the way of achieving their audacious goals. They have very strong mental maps of how things should be done, and at the same time a willingness to test those mental maps in the world of reality and change the ways they do things to make them work better. They are extremely resilient, because their need to achieve what they envision is stronger than the pain they experience as they struggle to achieve it. Perhaps most interesting, they have a wider range of vision than most people, either because they have that vision themselves or because they know how to get it from others who can see what they can’t. All are able to see both big pictures and granular details (and levels in between) and synthesize the perspectives they gain at those different levels, whereas most people see just one or the other. They are simultaneously creative, systematic, and practical. They are assertive and open-minded at the same time. Above all, they are passionate about what they are doing, intolerant of people who work for them who aren’t excellent at what they do, and want to have a big, beneficial impact on the world. (Location 1481)

Note: Traits of shapers

we use the idea meritocracy of radical truth and radical transparency to bring problems and weaknesses to the surface to prompt forthright dealing with them. (Location 1527)

Note: Use radical truth and transparency to bring problems to the surface and deal with them

by knowing what someone is like we can have a pretty good idea of what we can expect from them. (Location 1531)

Tags: psychometric tests

Note: Psychometric testst enable us to know what to expect of people

How the Economic Machine Works, (Location 1641)

Tags: towatch

Note: .towatch

Long before I had a lot of money, I had determined that I wanted my sons to have only enough to afford excellent health care, excellent education, and an initial boost to help their careers get started. My perspective was influenced by my own journey through life, which took me from having nothing to having a lot. That taught me to struggle well and made me strong. I wanted the same for the people I loved. So, when I had earned a lot of money, I felt I had plenty of money to give away to others. (Location 1744)

Tags: money, parenting, challenges

Note: Going through a struggle makes you stronger

pain as nature’s reminder that there is something important for me to learn. Encountering pains and figuring out the lessons they were trying to give me became sort of a game to me. The more I played it, the better I got at it, the less painful those situations became, and the more rewarding the process of reflecting, developing principles, and then getting rewards for using those principles became. I learned to love my struggles, which I suppose is a healthy perspective to have, like learning to love exercising (which I haven’t managed to do yet). (Location 1880)

Tags: challenges

Note: Pain is natures way of reminding us there is something important to learn

the satisfaction of success doesn’t come from achieving your goals, but from struggling well. To (Location 1888)

Tags: challenges

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. (Location 1924)

I have found it helpful to think of my life as if it were a game in which each problem I face is a puzzle I need to solve. By solving the puzzle, I get a gem in the form of a principle that helps me avoid the same sort of problem in the future. Collecting these gems continually improves my decision making, so I am able to ascend to higher and higher levels of play in which the game gets harder and the stakes become ever greater. (Location 1954)

Tags: issue4, principles

Note: View life as a game where you collect gems/principles as you go

Dreams + Reality + Determination = A Successful Life. (Location 1972)

Tags: success

Note: .success

Radical open-mindedness and radical transparency are invaluable for rapid learning and effective change. 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. Being radically open-minded enhances the efficiency of those feedback loops, because it makes what you are doing, and why, so clear to yourself and others that there can’t be any misunderstandings. (Location 1994)

Tags: issue4, favorite, learning

Note: .learning

I realized that most everything that at first seemed “bad” to me—like rainy days, weaknesses, and even death—was because I held preconceived notions of what I personally wanted. With time, I learned that my initial reaction was because I hadn’t put whatever I was reacting to in the context of the fact that reality is built to optimize for the whole rather than for me. (Location 2175)

Note: Reality is built to optimise for the whole rather than just you

for most people success is struggling and evolving as effectively as possible, i.e., learning rapidly about oneself and one’s environment, and then changing to improve. (Location 2186)

Tags: success

Note: .success

In order to gain strength one has to push one’s limits, which is painful. Yet most people instinctually avoid pain. This is true whether we are talking about building the body (e.g., weight lifting) or the mind (e.g., frustration, mental struggle, embarrassment, shame)—and especially true when people confront the harsh reality of their own imperfections. (Location 2199)

Tags: comfort zone, challenges

Note: we need to push our limits

Pain + Reflection = Progress. (Location 2203)

Tags: challenges

Note: .challenges

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. Though this process of pushing your limits, of sometimes failing and sometimes breaking through—and deriving benefits from both your failures and your successes—is not for everyone, if it is for you, it can be so thrilling that it becomes addictive. (Location 2212)

Tags: pushlimits

Note: .pushlimits if youre not failing youre not pushing your limits

No matter what you want out of life, your ability to adapt and move quickly and efficiently through the process of personal evolution will determine your success and your happiness. (Location 2247)

Tags: adapt

Note: your ability to adapt to personal evolution will determine your success and happiness

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. (Location 2304)

Note: Dont be upset if you are bad at something,its good you found out so you can deal with it

If you are disappointed because you can’t be the best person to do everything yourself, you are terribly naive. Nobody can do everything well. Would you want to have Einstein on your basketball team? (Location 2306)

Tags: favorite

Note: You cant be good at everything

Most of life’s greatest opportunities come out of moments of struggle; it’s up to you to make the most of these tests of creativity and character. (Location 2311)

Tags: challenges

Note: .challenges

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. (Location 2312)

Tags: improvement

Note: You have four options when you encounter weaknesses .challenges

Prioritize: While you can have virtually anything you want, you can’t have everything you want. (Location 2428)

Tags: prioritise

Note: .prioritise

View painful problems as potential improvements that are screaming at you. Though it won’t feel that way at first, each and every problem you encounter is an opportunity; for that reason, it is essential that you bring them to the surface. Most people don’t like to do this, especially if it exposes their own weaknesses or the weaknesses of someone they care about, but successful people know they have to. (Location 2461)

Tags: challenges

Note: .challenges

Understand your ego barrier. When I refer to your “ego barrier,” I’m referring to your subliminal defense mechanisms that make it hard for you to accept your mistakes and weaknesses. Your deepest-seated needs and fears—such as the need to be loved and the fear of losing love, the need to survive and the fear of not surviving, the need to be important and the fear of not mattering—reside in primitive parts of your brain such as the amygdala, which are structures in your temporal lobe that process emotions. Because these areas of your brain are not accessible to your conscious awareness, it is virtually impossible for you to understand what they want and how they control you. They oversimplify things and react instinctively. They crave praise and respond to criticism as an attack, even when the higher-level parts of the brain understand that constructive criticism is good for you. They make you defensive, especially when it comes to the subject of how good you are. (Location 2580)

Tags: ego

Note: .ego

if you can recognize that you have blind spots and open-mindedly consider the possibility that others might see something better than you—and that the threats and opportunities they are trying to point out really exist—you are more likely to make good decisions. (Location 2638)

Tags: openminded

Note: Be open minded to your blind spots

replace your attachment to always being right with the joy of learning what’s true. (Location 2642)

Tags: favorite, openminded

view. To be radically open-minded you must: a. 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. (Location 2647)

Tags: openminded

Note: .openminded

Recognize that decision making is a two-step process: First take in all the relevant information, then decide. Most people are reluctant to take in information that is inconsistent with what they have already concluded. (Location 2654)

Tags: decisions

Note: Be open to taking in information before you make a decision

Remember that you’re looking for the best answer, not simply the best answer that you can come up with yourself. The answer doesn’t have to be in your head; you can look outside yourself. If you’re truly looking at things objectively, you must recognize that the probability of you always having the best answer is small and that, even if you have it, you can’t be confident that you do before others test you. So it is invaluable to know what you don’t know. (Location 2672)

Tags: openminded, favorite

Note: You dont always have the best answer. Look beyond yourself

When two people believe opposite things, chances are that one of them is wrong. It pays to find out if that someone is you. That’s why I believe you must appreciate and develop the art of thoughtful disagreement. In thoughtful disagreement, your goal is not to convince the other party that you are right—it is to find out which view is true and decide what to do about it. In thoughtful disagreement, both parties are motivated by the genuine fear of missing important perspectives. (Location 2687)

Tags: disagreement

Note: The purpose of thoughtful disagreement is to find out which view is true

Remember, you are not arguing; you are openly exploring what’s true. (Location 2695)

Tags: openminded, disagreement

Note: .disagreement

People who change their minds because they learned something are the winners, whereas those who stubbornly refuse to learn are the losers. (Location 2698)

Tags: openminded

Note: Winners change their mind when they learn something new

good exercise to make sure that you are doing this well is to describe back to the person you are disagreeing with their own perspective. (Location 2701)

Tags: communication

Note: Describe the other persons perspective to ensure you understand their point of view

Closed-minded people don’t want their ideas challenged. They are typically frustrated that they can’t get the other person to agree with them instead of curious as to why the other person disagrees. (Location 2765)

Tags: closeminded

Note: Close minded people dont want their views challenged

Open-minded people are more curious about why there is disagreement. They are not angry when someone disagrees. They understand that there is always the possibility that they might be wrong and that it’s worth the little bit of time it takes to consider the other person’s views in order to be sure they aren’t missing something or making a mistake. (Location 2768)

Tags: openminded

Note: Open minded people know there is a possibility they could be wrong

Open-minded people are always more interested in listening than in speaking; they encourage others to voice their views. (Location 2788)

Tags: openminded

Note: .openminded listen more than you speak

Get to know your blind spots. When you are closed-minded and form an opinion in an area where you have a blind spot, it can be deadly. So take some time to record the circumstances in which you’ve consistently made bad decisions because you failed to see what others saw. (Location 2816)

Note: Get to know your blind spots

Remember, it is not an argument; it is an open exploration of what’s true. (Location 2838)

Tags: openminded, issue4, favorite

Note: Its not an argument, its an open exploration of what is true

Baseball Cards, which I mentioned in the first part of this book. Just as a baseball card compiles the relevant data on a baseball player, helping fans know what that player is good and bad at, I decided that it would be similarly helpful for us to have cards for all of our players at Bridgewater. (Location 2969)

Tags: issue4

Note: Each team member had their skills rated on cards

If you take nothing else away from this chapter, be aware of your subconscious—of how it can both harm you and help you, and how by consciously reflecting on what comes out of it, perhaps with the help of others, you can become happier and more effective. (Location 3094)

Note: Be aware of your subconscious

Charles Duhigg’s best-selling book The Power of Habit, (Location 3125)

Tags: toread

Note: .toread

Duhigg’s core idea is the role of the three-step “habit loop.” The first step is a cue—some “trigger that tells your brain to go into automatic mode and which habit to use,” according to Duhigg. Step two is the routine, “which can be physical or mental or emotional.” Finally, there is a reward, which helps your brain figure out if this particular loop is “worth remembering for the future.” Repetition reinforces this loop until over time it becomes automatic. (Location 3126)

Tags: habits

Note: Habit loop .habits

The left hemisphere reasons sequentially, analyzes details, and excels at linear analysis. “Left-brained” or “linear” thinkers who are analytically strong are often called “bright.” 2. The right hemisphere thinks across categories, recognizes themes, and synthesizes the big picture. “Right-brained” or “lateral” thinkers with more street smarts are often called “smart.” (Location 3151)

Note: Left and right brain

At Bridgewater, we use a test called the “Team Dimensions Profile” (TDP) to connect people with their preferred role. The five types identified by the TDP are Creators, Refiners, Advancers, Executors, and Flexors. (Location 3223)

Note: This is very like business chemistry

Everything looks bigger up close. In all aspects of life, what’s happening today seems like a much bigger deal than it will appear in retrospect. That’s why it helps to step back to gain perspective and sometimes defer a decision until some time passes. (Location 3383)

Note: Things happening today seem more important than they will in retropective

Some decisions are best made after acquiring more information; some are best made immediately. Just as you need to constantly sort the big from the small when you are synthesizing what’s going on, you need to constantly evaluate the marginal benefit of gathering more information against the marginal cost of waiting to decide. (Location 3516)

Tags: decisions

Note: Decide if you should get more information or make the decision immediately

almost all “cases at hand” are just “another one of those,” identifying which “one of those” it is, and then applying well-thought-out principles for dealing with it. (Location 3541)

Tags: issue4, decisions

Note: Everything is just "another one of those"

they are immune to the biases and consensus-driven thinking of crowds; they don’t care if what they see is unpopular, and they never panic. (Location 3627)

Tags: computers

Note: Computers are immune to biases or caring about popular opinion

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. (Location 3707)

Tags: ego

Note: .ego our ego and blindspot barrier prevent us from seeing things as they really are

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 blind spots get in your way. (Location 3709)

Tags: issue4, openminded

Note: .openminded radica open mindedness is the ability to explore different points of view without our ego or blinspot barriers getting in the way

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. (Location 3714)

Tags: openminded

Note: .openminded we must understand that everyones brain is wired differently

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. (Location 3717)

Tags: decisions

Note: .decisions

Embrace Reality and Deal with It 1.1 Be a hyperrealist. a. Dreams + Reality + Determination = A Successful Life. 1.2 Truth—or, more precisely, an accurate understanding of reality—is the essential foundation for any good outcome. 1.3 Be radically open-minded and radically transparent. a. Radical open-mindedness and radical transparency are invaluable for rapid learning and effective change. b. Don’t let fears of what others think of you stand in your way. c. Embracing radical truth and radical transparency will bring more meaningful work and more meaningful relationships. 1.4 Look to nature to learn how reality works. a. Don’t get hung up on your views of how things “should” be because you will miss out on learning how they really are. b. 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. c. Evolution is the single greatest force in the universe; it is the only thing that is permanent and it drives everything. d. Evolve or die. 1.5 Evolving is life’s greatest accomplishment and its greatest reward. a. The individual’s incentives must be aligned with the group’s goals. b. Reality is optimizing for the whole—not for you. c. Adaptation through rapid trial and error is invaluable. d. Realize that you are simultaneously everything and nothing—and decide what you want to be. e. What you will be will depend on the perspective you have. 1.6 Understand nature’s practical lessons. a. Maximize your evolution. b. Remember “no pain, no gain.” c. It is a fundamental law of nature that in order to gain strength one has to push one’s limits, which is painful. 1.7 Pain + Reflection = Progress. a. Go to the pain rather than avoid it. b. Embrace tough love. 1.8 Weigh second- and third-order consequences. 1.9 Own your outcomes. 1.10 Look at the machine from the higher level. a. 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. b. By comparing your outcomes with your goals, you can determine how to modify your machine. c. Distinguish between you as the designer of your machine and you as a worker with your machine. d. 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. e. Successful people are those who can go above themselves to see things objectively and manage those things to shape change. f. 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 you from doing what you shouldn’t be doing. g. Because it is difficult to see oneself objectively, you need to rely on the input of others and the whole body of evidence. h. If you are open-minded enough and determined, you can get virtually anything you want. (Location 3743)

Tags: favorite, principles

Note: .principles Principle one

Use the 5-Step Process to Get What You Want Out of Life 2.1 Have clear goals. a. Prioritize: While you can have virtually anything you want, you can’t have everything you want. b. Don’t confuse goals with desires. c. Decide what you really want in life by reconciling your goals and your desires. d. Don’t mistake the trappings of success for success itself. e. Never rule out a goal because you think it’s unattainable. f. Remember that great expectations create great capabilities. g. Almost nothing can stop you from succeeding if you have a) flexibility and b) self-accountability. h. Knowing how to deal well with your setbacks is as important as knowing how to move forward. 2.2 Identify and don’t tolerate problems. a. View painful problems as potential improvements that are screaming at you. b. Don’t avoid confronting problems because they are rooted in harsh realities that are unpleasant to look at. c. Be specific in identifying your problems. d. Don’t mistake a cause of a problem with the real problem. e. Distinguish big problems from small ones. f. Once you identify a problem, don’t tolerate it. 2.3 Diagnose problems to get at their root causes. a. Focus on the “what is” before deciding “what to do about it.” b. Distinguish proximate causes from root causes. c. Recognize that knowing what someone (including you) is like will tell you what you can expect from them. 2.4 Design a plan. a. Go back before you go forward. b. Think about your problem as a set of outcomes produced by a machine. c. Remember that there are typically many paths to achieving your goals. d. Think of your plan as being like a movie script in that you visualize who will do what through time. e. Write down your plan for everyone to see and to measure your progress against. f. Recognize that it doesn’t take a lot of time to design a good plan. 2.5 Push through to completion. a. Great planners who don’t execute their plans go nowhere. b. Good work habits are vastly underrated. c. Establish clear metrics to make certain that you are following your plan. 2.6 Remember that weaknesses don’t matter if you find solutions. a. Look at the patterns of your mistakes and identify at which step in the 5-Step Process you typically fail. b. Everyone has at least one big thing that stands in the way of their success; find yours and deal with it. 2.7 Understand your own and others’ mental maps and humility. (Location 3797)

Tags: principles

Note: .principles principle two

Be Radically Open-Minded 3.1 Recognize your two barriers. a. Understand your ego barrier. b. Your two “yous” fight to control you. c. Understand your blind spot barrier. 3.2 Practice radical open-mindedness. a. 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. b. Recognize that decision making is a two-step process: First take in all the relevant information, then decide. c. Don’t worry about looking good; worry about achieving your goal. d. Realize that you can’t put out without taking in. e. 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. f. Remember that you’re looking for the best answer, not simply the best answer that you can come up with yourself. g. Be clear on whether you are arguing or seeking to understand, and think about which is most appropriate based on your and others’ believability. 3.3  Appreciate the art of thoughtful disagreement. 3.4 Triangulate your view with believable people who are willing to disagree. a. Plan for the worst-case scenario to make it as good as possible. 3.5 Recognize the signs of closed-mindedness and open-mindedness that you should watch out for. 3.6 Understand how you can become radically open-minded. a. Regularly use pain as your guide toward quality reflection. b. Make being open-minded a habit. c. Get to know your blind spots. d. If a number of different… (Location 3846)

Tags: principles

Note: .principles principle three

Understand That People Are Wired Very Differently 4.1 Understand the power that comes from knowing how you and others are wired. a. We are born with attributes that can both help us and hurt us, depending on their application. 4.2 Meaningful work and meaningful relationships aren’t just nice things we chose for ourselves—they are genetically programmed into us. 4.3 Understand the great brain battles and how to control them to get what “you” want. a. Realize that the conscious mind is in a battle with the subconscious mind. b. Know that the most constant struggle is between feeling and thinking. c. Reconcile your feelings and your thinking. d. Choose your habits well. e. Train your “lower-level you” with kindness and persistence to build the right habits. f. Understand the differences between right-brained and left-brained thinking. g. Understand how much the brain can and cannot change. 4.4 Find out what you and others are like. a. Introversion vs. extroversion. b. Intuiting vs. sensing. c. Thinking vs. feeling. d. Planning vs. perceiving. e. Creators vs. refiners vs. advancers vs. executors vs. flexors. f. Focusing on tasks vs. focusing on goals. g. … (Location 3884)

Tags: principles

Note: .principles principle four

5 Learn How to Make Decisions Effectively 5.1 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). 5.2 Synthesize the situation at hand. a. One of the most important decisions you can make is who you ask questions of. b. Don’t believe everything you hear. c. Everything looks bigger up close. d. New is overvalued relative to great. e. Don’t oversqueeze dots. 5.3 Synthesize the situation through time. a. Keep in mind both the rates of change and the levels of things, and the relationships between them. b. Be imprecise. c. Remember the 80/20 Rule and know what the key 20 percent is. d. Be an imperfectionist. 5.4 Navigate levels effectively. a. Use the terms “above the line” and “below the line” to establish which level a conversation is on. b. Remember that decisions need to be made at the appropriate level, but they should also be consistent across levels. 5.5 Logic, reason, and common sense are your best tools for synthesizing reality and understanding what to do about it. 5.6 Make your decisions as expected value calculations. a. Raising the probability of being right is valuable no matter what your probability of being right already is. b. Knowing when not to bet is as important as knowing what bets are probably worth making. c. The best choices are the ones that have more pros than cons, not those that don’t have any cons at all. 5.7 Prioritize by weighing the value of additional information against the cost of not deciding. a. All of your “must-dos” must be above the bar before you do your “like-to-dos.” b. Chances are you won’t… (Location 3914)

Tags: principles

Note: .principles principle five, decision making

treasured thoughtful disagreement with them as a way of learning and raising our odds of making good decisions, (Location 4584)

Tags: openminded, issue4

Note: .thoughtful disagreement increases the odds of good decisions

Our overriding objective is excellence, or more precisely, constant improvement, a superb and constantly improving company in all respects. Conflict in the pursuit of excellence is a terrific thing. There should be no hierarchy based on age or seniority. Power should lie in the reasoning, not the position, of the individual. The best ideas win no matter who they come from. (Location 4625)

Tags: excellence

Note: .excellence conflict in the pursuit of excellence is a good thing

A believability-weighted idea meritocracy is the best system for making effective decisions. (Location 4640)

Tags: decisions

Note: .decisions

That’s because an idea meritocracy—i.e., a system that brings together smart, independent thinkers and has them productively disagree to come up with the best possible collective thinking and resolve their disagreements in a believability-weighted way—will outperform any other decision-making system. (Location 4645)

Tags: ideameritocracy

Note: .ideameritocracy

Idea Meritocracy = Radical Truth + Radical Transparency + Believability-Weighted Decision Making. (Location 4662)

Tags: ideameritocracy

Note: .ideameritocracy

As Harvard developmental psychologist 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. (Location 4688)

Tags: favorite

Note: You do your actual job and the job of managing others impressions

Idea meritocracies carefully weigh the merits of its members’ opinions. Since many opinions are bad and virtually everyone is confident that theirs are good, the process of being able to sort through them well is important to understand. (Location 4791)

Tags: ideameritocracy

Note: .ideameritocracy

if you look back on yourself a year ago and aren’t shocked by how stupid you were, you haven’t learned much. (Location 5138)

Tags: learning

Note: .learning

The people I respect most are those who fail well. I respect them even more than those who succeed. That is because failing is a painful experience while succeeding is a joyous one, so it requires much more character to fail, change, and then succeed than to just succeed. People who are just succeeding must not be pushing their limits. Of course the worst are those who fail and don’t recognize it and don’t change. (Location 5165)

Tags: failure

Note: .failure

Remember this: The pain is all in your head. If you want to evolve, you need to go where the problems and the pain are. By confronting the pain, you will see more clearly the paradoxes and problems you face. Reflecting on them and resolving them will give you wisdom. The harder the pain and the challenge, the better. (Location 5189)

Tags: pain

Note: .pain

Conflicts are essential for great relationships . . . . . . because they are how people determine whether their principles are aligned and resolve their differences.

Everyone has his or her own principles and values, so all relationships entail a certain amount of negotiation or debate over how people should be with each other. What you learn about each other will either draw you together or drive you apart. If your principles are aligned and you can work out your differences via a process of give-and-take, you will draw closer together.

If not, you will move apart. Open discussion of differences ensures that there are no misunderstandings. If that doesn’t happen on an ongoing basis, gaps in perspective will widen until inevitably there is a major clash. (Location 5261)

Tags: principles, relationships, favorite, conflict

Note: Conflicts allow you to openly discuss your principles

Remember that every story has another side. Wisdom is the ability to see both sides and weigh them appropriately. (Location 5290)

Tags: favorite, openminded, conflict

Note: .conflict every story has another side

Open-minded people seek to learn by asking questions; they realize how little they know in relation to what there is to know and recognize that they might be wrong; they are thrilled to be around people who know more than they do because it represents an opportunity to learn something. (Location 5302)

Tags: issue4, openminded

Note: .openminded open minded people know how little they know and ask questions to continuously learn

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. (Location 5337)

Tags: meetings

Note: .meetings Meetings should have an owner

“Sorry for being stupid, but I’m going to need to slow you down so I can make sense of what you’re saying.” (Location 5377)

Tags: communication

Note: .communication how to slow down fast talkers

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. (Location 5477)

Note: Everyone has opinions and they are often bad

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. (Location 5481)

Tags: openminded, issue4

Note: Have open conversations with believable people who disagree with you

Everyone should be up-front in expressing how confident they are in their thoughts. A suggestion should be called a suggestion; a firmly held conviction should be presented as such—particularly if it’s coming from someone with a strong track record in the area in question. (Location 5503)

Tags: communication, words, favorite

Note: Be open in how confident you are in your thoughts

Understand how people came by their opinions. Our brains work like computers: They input data and process it in accordance with their wiring and programming. Any opinion you have is made up of these two things: the data and your processing or reasoning. When someone says, “I believe X,” ask them: What data are you looking at? What reasoning are you using to draw your conclusion? (Location 5539)

Note: when trying to understand someone elses view ask them for the data they are using and their reasoning .disagreement

It’s more important to do big things well than to do the small things perfectly. (Location 5566)

Tags: favorite, newsletter, prioritise

Note: .prioritise focus on doing the big things well

Don’t let the little things divide you when your agreement on the big things should bind you. Almost every group that agrees on the big things ends up fighting about less important things and becoming enemies even though they should be bound by the big things. (Location 5660)

Tags: disagreement

Note: Disagreement on the small things is insignificant compared to agreement on the big things

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. Because we treat work as more than just what we do to make a living, we look at every potential hire not just as an employee but as someone we’d want share our lives with. We insist that the people we work with are considerate and have a high sense of personal accountability to do the difficult, right things. We look for people with generous natures and high standards of fairness. Most important, they must be able to put their egos aside and assess themselves candidly. (Location 5815)

Tags: hiring

Note: .hiring

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. (Location 5847)

Tags: work, favorite, values

Note: Meaningful work and meaningful relationships

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. (Location 5985)

Tags: values, money

Note: The purpose of money is to get what you want .money

Knowing what people are like is the best indicator of how well they are likely to handle their responsibilities in the future. At Bridgewater, we call this “paying more attention to the swing than the shot.” (Location 6214)

Great managers are not philosophers, entertainers, doers, or artists. They are engineers. They see their organizations as machines and work assiduously to maintain and improve them. They create process-flow diagrams to show how the machine works and to evaluate its design. They build metrics to light up how well each of the individual parts of the machine (most importantly, the people) and the machine as a whole are working. And they tinker constantly with its designs and its people to make both better. (Location 6367)

Tags: managing

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. Micromanaging, in contrast, is telling the people who work for you exactly what tasks to do or doing their tasks for them. Not managing is having them do their jobs without your oversight and involvement. To be successful, you need to understand these differences and manage at the right level. (Location 6427)

Tags: managing

Note: .managing great managers orchestrate rather than do

You should be able to delegate the details. If you keep getting bogged down in details, you either have a problem with managing or training, or you have the wrong people doing the job. The real sign of a master manager is that he doesn’t have to do practically anything. Managers should view the need to get involved in the nitty-gritty as a bad sign. (Location 6440)

Tags: managing

Note: .managing you should not have to get bogged down in the details

Develop a full profile of each person’s values, abilities, and skills. These qualities are the real drivers of behavior, so knowing them in detail will tell you which jobs a person can and cannot do well, which ones they should avoid, and how the person should be trained. These profiles should change as the people change. (Location 6447)

Tags: personality type, managing

Note: .managing develop a full profile of your employees

Regularly take the temperature of each person who is important to you and to the organization. Probe your key people and urge them to bring up anything that might be bothering them. These problems might be ones you are unaware of, or they may be misunderstood by the person raising them. Whatever the case, it is essential that they be brought out into the open. (Location 6452)

Tags: managing

Note: .managing regularly ask your employees how everything is going

This initial failure to perceive and not tolerate problems did not happen for lack of caring; it happened because most of the people in the process paid more attention to getting the tasks done than assessing whether the goals were being achieved. They had become more like rubber stampers than craftsmen, while the top people who were supposed to “taste the soup” to make sure it was excellent were focused on other things. (Location 6697)

Tags: standards

Note: When focusing on getting the job done dont let standards slip

Watch out for the “Frog in the Boiling Water Syndrome.” Apparently, if you throw a frog into a pot of boiling water it will jump out immediately, but if you put it in room-temperature water and gradually bring it to a boil, it will stay in the pot until it dies. Whether or not that’s true of frogs, I see something similar happen to managers all the time. People have a strong tendency to slowly get used to unacceptable things that would shock them if they saw them with fresh eyes. (Location 6716)

Tags: standards

Note: dont let standards slowly slip to anunacceptable level

“Taste the soup.” Think of yourself as a chef and taste the soup before it goes out to the customers. Is it too salty or too bland? Managers need to do that too, or have someone in their machine do it for them, for every outcome they’re responsible for. People who are delegated this task are called “taste testers.” (Location 6730)

Tags: standards

Note: Have taste testers to ensure standards remain high

When you encounter problems, your objective is to specifically identify the root causes of those problems—the specific people or designs that caused them—and to see if these people or designs have a pattern of causing problems. (Location 6766)

Note: Always look to identify the root of problems

To diagnose well, ask the following questions: 1. Is the outcome good or bad? 2. Who is responsible for the outcome? 3. If the outcome is bad, is the Responsible Party incapable and/or is the design bad? (Location 6789)

Note: Diagnosing problems. Is it a people or machine issue

Keep in mind that managers usually fail or fall short of their goals for one (or more) of five reasons. 1. They are too distant. 2. They have problems perceiving bad quality. 3. They have lost sight of how bad things have become because they have gotten used to it. 4. They have such high pride in their work (or such large egos) that they can’t bear to admit they are unable to solve their own problems. 5. They fear adverse consequences from admitting failure. (Location 6881)

Tags: managing

Note: .managing

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. (Location 7015)

Tags: redundancy

Note: Cleansing storms can result in a smaller team of higher calibre people

Use “double-do” rather than “double-check” to make sure mission-critical tasks are done correctly. Double-checking has a much higher rate of errors than double-doing, which is having two different people do the same task so that they produce two independent answers. This not only ensures better answers but will allow you to see the differences in people’s performance and abilities. I use double-do’s in critical areas such as finance, where large amounts of money are at risk. And because an audit is only as effective as the auditor is knowledgeable, remember that a good double-check can only be done by someone capable of double-doing. If the person double-checking the work isn’t capable of doing the work himself, how could he possibly evaluate it accurately? (Location 7090)

Note: Have two different people do a task rather than have someone do it twice to ensure accuracy

Bridgewater’s values and strategic goals have been the same since the beginning (to produce excellent results, meaningful work, and meaningful relationships through radical truth and transparency) (Location 7151)

Tags: values

Note: .values

Remember that almost everything will take more time and cost more money than you expect. Virtually nothing goes according to plan because one doesn’t plan for the things that go wrong. I personally assume things will take about one and a half times as long and cost about one and a half times as much because that’s what I’ve typically experienced. (Location 7222)

Tags: toshare, estimate, planning

Note: .planning Everything costs more and takes longer than you think it will

Use tools to collect data and process it into conclusions and actions. (Location 7324)

Tags: gtd

Note: .gtd

An idea meritocracy requires people to do three things: 1) Put their honest thoughts on the table for everyone to see, 2) Have thoughtful disagreements where there are quality back-and-forths in which people evolve their thinking to come up with the best collective answers possible, and 3) Abide by idea-meritocratic ways of getting past the remaining disagreements (such as believability-weighted decision making). (Location 7454)

Tags: ideamerioritracy

Note: .ideamerioritracy