Page 99 - Ray Dalio - Principles

But while almost all of us quickly agreed on the principles
intellectually, many still struggled to convert what they had
agreed to intellectually into effective action. This was because

their habits and emotional barriers remained stronger than
their reasoning. The training and the virtual-reality tapes
helped a lot, but they still weren’t enough.

No matter how much effort we put into screening new hires
and training them to work in our idea meritocracy, it was
inevitable that many of them would fall short. My approach
was to hire, train, test, and then fire or promote quickly, so that

we could rapidly identify the excellent hires and get rid of the
ordinary ones, repeating the process again and again until the
percentage of those who were truly great was high enough to
meet our needs.

But for this to work, we needed people with high standards
who wouldn’t hesitate to eliminate people who couldn’t cut it.
Many new employees (and some older ones) still were

reluctant to probe hard at what people were like, which made
things worse. It’s tough to be tough on people.

Of course, most of the people who come to Bridgewater are
adventurous types; they know what they’re getting into. They
understand that the chances their job will not work out are
higher than normal, but they embrace the risk because the

upside of succeeding is huge relative to the downside of
having it not work out. In the worst case they learn a lot about
themselves, have an interesting experience, and leave for other
jobs; in the best case, they become a part of an exceptional
team achieving exceptional things.

New hires typically go through an acclimation period of
about eighteen to twenty-four months before becoming

comfortable with the truthfulness and transparency that is such
an essential part of the Bridgewater culture—especially
accepting one’s mistakes and figuring out how to deal with
them. But some people never adapt to it. I’ve been told that
joining Bridgewater is a bit like joining an intellectual Navy
SEALs; others describe it as going to a school of self-
discovery run by someone like the Dalai Lama. The people

who thrive say that while the period of adjustment is difficult,