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5 steps to success
- They are iterative
- Do them ONE at a time!
Step 1: Have clear goals
- You shoulder (almost) never drop a goal because you think it’s unattainable!
Step 2: Identify problems/obstacles
- Bring problems to the surface, so you can learn from them
- Don’t mistake causes with problems!
- Problem = Poor performance
- Cause = Not getting enough sleep
- While the logical part of your brain knows it’s good to address your problems, your emotional part hates it
Step 3: Diagnose the root cause
- Diagnose before proposing solutions
- Find the disease rather than the symptoms (look at ROOT causes, rather than proximate causes)
- Symptoms = I missed the train because I didn’t buy train tickets
- Disease = I missed the train because I’m forgetful
Step 4: Design principles for avoiding the problems/obstacles in the future
Step 5: Follow the principles
What are principles?
- Principles = Decision making criteria
How to find principles?
- Categorize situations and find principles for dealing with them:
- Pain + Reflection (find the root cause) = Principles
- Use other peoples principles
- What do do when experiencing a new type of situation you don’t have principles for?
How to improve your principles?
- Analyze previous decisions to see if they would have worked
- Write them down as algorithms a computer can run!
- Computers can process more information and are unemotional!
- Compare your intuitions with the decisions made by the computer:
- If the computer were right and your intuition were wrong, examine why
- If your intuition was right and the computer were wrong, consider updating the principles the computer uses
Understand your 2 biggest barriers
- Ego barrier
- It’s hard to see your own weaknesses & mistakes!
- Blind spot barrier
- We all see the world differently (Linear vs. lateral thinking, big picture vs. details, etc.)
Solve your 2 biggest barriers with open-mindedness
- Realize that others might see something more accurately than you
- The probability that you have the best answer is really low!
- How to be more open minded?
- Explore different points of view while being in the state of “not knowing”.
- Understand the arguments of the smartest people who disagree with you
- When someone is more believable than yourself, place them as teacher and yourself as student
- If everybody disagrees with you, try to figure out the reason for it!
- Humility is important, because it’s required for seeking help from others
- Knowing a lot + humility is better than either alone!
Seeing yourself as a machine within a bigger machine
- It’s more important to be a designer of your machine, than a worker of your machine (even though both are important)
- How to improve your machine?
- Identify recurring problems!
- Compare your outcomes with your goals!
Consider whether to find big picture or in details
- Only go into details when necessary
Understand that we are all wired differently
- Just like we are born with physical constraints, we are also born with mental constraints
- Some can be changed through training while others can’t.
- Brain plasticity is real, but the brain isn’t 100% mallable
- Find ways of dealing with your weaknesses
- Deny them (what most people do)
- Turn them into strengths
- Find workarounds
- Pursue different goals
- Get help
- We are preprogrammed with learning
- We are instinctively afraid of snakes, but not of flowers
- You have to see yourself and others objectively
- Looking at yourself objectively is hard, so get help from others input!
- Understand that most people will operate according to their own interests
Make believability-weighted decisions
- Believable people are those who have repeated successes and can explain the cause-effect relationships behind them
- Bridgewater’s dot collector lets them see the believability-weighted conclusion and the equal-weighted conclusion, to see if there are any disagreements
- The dot collector uses ratings on different attributes (creativity, expertise in subject, etc. ) from peers & tests.
How Ray Dalio operates Bridgewater
Personality tests they use
- The workplace personality inventory
- The team dimensions profile
- Stratified systems theory
- Library of common scenarios and the principles to apply
- See each others thought in real time
- Give each other positive or negative dots for specific attributes, which is dynamically inserted into a grid for everyone to see
- Information from reviews, tests, choices they make, etc.
- This information is analyzed by computers to generate people’s strengths & weaknesses on the baseball cards
- A text summary of the baseball cards
- Name some people you would like to solve a problem, and then it synthesizes their strengths and find similar people
- Who made which mistake?
- How severe?
- Lets people record their pain as they experience it
- Later they are prompted to reflect on it to make progress (because of his principle “pain + reflection = progress”)
- A series of guided questions to resolve disputes
Daily update tool
- For employees to report what they did, issues & reflections on those issues
- For everything people agree to do at meetings
Process flow diagrams
- Who has which responsibilities?
Policy & procedural manual
- Instructions for how to behave
- Find them by:
- Knowing your goals
- Knowing the processes that lead to those goals
- Finding the best places in the processes to measure
- Find levers that affect those metrics
- Based on your knowledge your decide which actions to take to pursue your goals, which are based on your values
- Have the best possible life by:
- Knowing what the best decisions are
- Having the courage to make them
Techniques for good decision making
- Use logic, reason and common sense!
- Make expected value calculations
- Value of decision = (Benfits * likelihood of benefits) – (cost * likelihood of cost)
- Compare the benefit of gathering more information with the cost of waiting to decide.
- Perhaps get someone else to make your decision?
- Be wary of emotional decision making
- What feels good in the moment might be bad long-term
- When facing two seemingly opposed decisions, get the best of both worlds?
- A group can make better decisions than an individual!
- Remember that everything seems much bigger in the moment than in retrospect
- Get rid of irrelevant details, so you can see what’s important!
- Also, usually don’t seek more than the 20% of information that gives you 80% of the results!
How much better is it to be REALLY successful?
- He experienced everything from being down to being on top
- Talked to those he wanted to talk to!
- Gone where he wanted to go!
- Gotten everything he wanted to own!
- Done everything he wanted to do!
- But he says it wasn’t much better than having basic needs meet: Good bed, relationships, food & sex!
- He is still struggling
- The people at the top weren’t that much more special
- Having a lot comes with heavy burdens
- Being well known is probably worse than being anonymous
- Even his impact was small, when putting things in perspective
We are insignificant
- You are 1 out of 7 billion people, which is 1 out of 10 million species on the planet, which is 1 out of 100 billion planets in our galaxy, which is 1 out of about 2 trillion galaxies
- Your life is 1/3000 of humanity’s existence, which is 1/20.000 of the earths existence
- Make many uncorrelated bets