“The traditional relationship between “leaders” and “followers” is the opposite of what I believe is needed to be most effective, and being maximally effective is the most important thing a “leader” must do.” – Ray Dalio
Although I have been a librarian for over twenty-two years, it still amazes me that certain books can have a deep impact on our view of the world and ourselves. This is happening to me right now with a remarkable book called Principles by Ray Dalio.
Ray Dalio is an American billionaire investor, hedge fund manager, and philanthropist. Most famously, Dalio is the founder, co-chairman and co-chief investment officer of Bridgewater Associates, one of the world’s largest hedge funds. Dalio and his company are known as mavericks in the investment world due to their unique approach to building the culture of their organization.
Bridgewater and Culture
Bridgewater strives to be a meritocracy of ideas. In this system, openness and dialogue are maximized for the goal of allowing the best ideas to come to the surface. It strives for an unprecedented level of openness and feedback. At Bridgewater, every meeting is recorded, every staff evaluation is open record, and anyone can give and receive feedback from anyone else. For many, the Bridgewater approach of total transparency makes them uncomfortable. For those who adapt to it, the culture becomes a powerful tool to produce personal, company, and revenue growth that benefits everyone. A good primer on the Bridgewater approach can be gleaned from Adam Grant’s podcast WorkLife, specifically the episode, “How to Love Criticism”
The Bridgewater approach runs counter to the traditional organizations where seniority or position are the major factors in decision making. Due to their unique culture, in order for the company to succeed it had to develop very particular notions about the role of a leader. I believe the Bridgewater approach to leadership is worth exploring, because the basic principles appear to have universal application. I think it is especially true for government as our public records laws already force us to be open with disclosure. As well, I think the Bridgewater idea of leadership has merits for libraries, since we are in the business of making information freely available to all. The core library value of free access to information makes our profession a potential fit for this type of approach.
Leadership in an Idea Meritocracy
Whereas in many organizations the positional leaders tolerate little disagreement, at Bridgewater the opposite is true. For a leader in an idea meritocracy, supporting the pursuit of truth and the search for the best ideas is paramount. This happens when the leaders encourage a culture of conversation and debate. Dalio states that “Thoughtful discussion and disagreement is practical because it stress-tests leaders and bring what is missing to their attention.” When an organization wants to discover the best ideas, Dalio believes that leaders must do two things well.
1/ “Open-mindedly seek out the best answers.”
2/ “Bring others along as part of that discovery process.”
Additionally, in contrast to the traditional perception that a leader must appear certain and decisive at all times, the guidance above means that in Bridgewater’s culture, “A truly great leader is appropriately uncertain but well equipped to deal with that uncertainty through open-minded exploration.” Carrying this idea forward, Dalio places a high premium on asking questions. While some leaders may hesitate to ask questions out of concern that they may look ignorant or uninformed, Dalio believes that asking questions is, “necessary in order to become wise and it is a prerequisite for being strong and decisive.” Taking it even a step further, he believes that leaders should not hesitate to seek out those who are smarter and wiser then themselves, and even let staff who are better equipped in an area take the lead. Ego and self promotion have no place in a true meritocracy. As Dalio states, “The objective is to have the best understanding to make the best possible leadership decisions.”
One thing that leaders often fall into is the trap of likability. If a leader makes decisions with the goal of making everyone happy, they are bound to fail. I relate to this point because I have found myself slipping into the “likability” trap from time to time. It is natural to do since few people want to make enemies or engage in conflict. From Dalio’s point of view, this trap is a big danger for an organization. When leaders spend time worrying about being liked, they are wasting energy in a fruitless pursuit. As Dalio puts it, “If you don’t have better insights than them, you shouldn’t be a leader – and if you do have better insights that them, don’t worry if you are doing unpopular things.” He tells his leaders, “Just worry about making the best decisions possible, recognizing that no matter what you do, most everyone will think you’re doing something – or many things – wrong.” Instead of conflict being problematic, disagreements are instead viewed as a sign that leaders are doing their job. To have people engaged in meaningful debate means that everyone is engaged in the process, wrapping their mind around problems, and providing different views on the subject at hand. This is valuable in order to refine ideas, identify issues, and surface the truth.
This approach to leadership places a huge responsibility on leaders to effectively and openly communicate. It becomes vital for leaders to know that everyone understands the issues at hand and be engaged in the process. Dalio warns that, “When you are the only one thinking, the results will suffer.” The old style authoritarian leader who barks orders just doesn’t cut it at a company like Bridgewater because “Authoritarian managers don’t develop their subordinates, which means those who report to them stay dependent.” If leaders default to order giving what happens in the end is that it leads to resentment or even worse, defiance. From Dalio’s point of view, leaders in a meritocracy need to recognize that, “The greatest influence you can have over intelligent people – and the greatest influence they will have on you – comes from constantly getting in sync with what is true and what is best so that you all want the same thing.” By being in sync, Dalio is not implying a state of “group-think.” Instead, for him being in sync means that everyone is in agreement on the broader principles and goals. Once the terms of engagement are clear, vigorous debate can follow.
The Future of Leadership?
I think Ray Dalio and Bridgewater provide a modern view of leadership that more people should strive to emulate. I am planning to apply many of these principles to my own leadership approach and then examine the impact. At the very least, if I introduce these ideas to my library managers and supervisors it can start a conversation, which in the Bridgewater spirit, is a great place to begin.
Author note: The material and quotes presented here are from Principles, 2017, Section 10.10, pages 464-466. All images in this post are from free online sources.