One of the most successful hedge fund managers Ray Dalio a billionaire, founder of Bridgewater Associates, which has $120 billion in assets under management, shared his secret in his book Principles, a steps approach to guarantee success.
Ray Dalio developed the 5-steps process to help people focus and achieve their goals in personal and professional life. You can use the following 5 steps method to accomplish any goal in your life: personal or work-related.
Ray says principles are the fundamental facts that specify how you act. They reflect your personality and values. Setting some principles in life will help you deal with the complexity of life.
Instead of looking for a solution for every new problem tirelessly, following this 5 steps approach will help you streamline the process.
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.
— Ray Dalio
Almost every human being has its own set of principles. Highly successful people implement the principles and live their life by them.
For example, one of my principles in life is that if I commit to someone that I will be there at a specific time, I will make sure to be there at least 5–10 before the person arrives.
I proudly say that I never missed a single meeting in the past 3 years, and my employer or even people in my social circle trust me and always give an example of my work ethic.
Here is Ray Dalio’s 5 Step process for getting what you want
1- Set clear goals
You have to have your audacious goals. — Ray Dalio
To have clear goals simply means to answer your why. Why are we pursuing this goal? What are the objectives? If you truly want to achieve that goal, you will always have a plan to reach that goal, it’s not merely to have a goal for the sake of having a goal.
2- Notice mistakes
As you go to those, you are going to encounter your failures, your mistakes. You have to identify those and not tolerate them. — Ray Dalio
Ray mention in his book Principles that all mistakes are hidden gems, as long as you figure out how to learn from them. We need to gather knowledge to overcome those mistakes and accomplish our audacious goals.
Ray advises that looking at each problem is nature’s way of telling you to improve in that particular area. That’s why people who learn continuously are the most successful.
3- Understand why you are making those mistakes
You have to get the diagnosis to the root cause of them, which could be that you have a weakness or somebody has a weakness. — Ray Dalio
Here we need strategic thinking to diagnose the root cause of the mistakes. Carefully diagnose each mistake and understand thoroughly why this panned. Always pay attention to details.
4- Fix your mistakes
We forget: In life, it doesn’t matter what happens to you or where you came from. It matters what you do with what happens and what you’ve been given. — Ryan Holiday
Once we are done with steps 1–3, it’s time to fix those mistakes by designing a plan that will go around all the obstacles; think of your problem as a set of outcomes produced by a machine. Make sure to write down the plan for everyone to see and measure the progress along the way.
5- Persevere
I saw that to do exceptionally well you have to push your limits and that, if you push your limits, you will crash and it will hurt a lot. You will think you have failed — but that won’t be true unless you give up. ― Ray Dalio
Always execute the plan; without an execution, a great plan is absolutely nothing but a waste of time and resources. Here we can recall our first step and ask ourselves why we want to achieve this goal. Our ‘why’ will help us to keep going.
Conclusion
I would highly recommend checking this book, Principles by Ray Dalio (Amazon affiliate link). There are tons of case studies to learn from his mistakes and achievements. Mr. Dalio also mentions a couple of personality tools to shape your career.
Be flexible, work hard, and always stick to reality while reaching your goal. Always ask ‘why’ this and ‘why’ right now.
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