Principles

Dalio argues that hiring well and ensuring that employees fit well is another essential component of a successful organization. He explores advice like: “Hire someone better than you” (400). According to him, interviewing does not end at the point of hiring. Instead, it continues through reviews and training as long as an individual is with an organization. Dalio encourages promoting people but, on the other hand, does not believe it serves a company to hold on to people who are not committed to the organization.

He tells an anecdote about a time when an executive at Bridgewater was working on a transition plan for his replacement. The plan turned out to be all about how that executive did things, with no plan for how to accommodate a person who did things differently from him. Dalio reflects on this experience and concludes that individuals must be separated from their roles, and that there should be plans to allow for individual variances within roles.

One of the most important considerations in managing roles is choosing who to deem the “Responsible Parties” (RPs) for making decisions. RPs are accountable for implementing decisions within a unit, project, or other level, but they also must bear the consequences of their decisions, for better or worse.