121.Remember that everything is a case study.
Think about what it is a case of and what principles apply.
122.Teach your people to fish rather than give them fish.
It is a bad sign when you tell people what they should do because that behavior typically reflects micromanagement or inability on the part of the person being managed. Instead, you should be training and testing. So give people your thoughts on how they might approach their decisions or how and why you would operate in their shoes, but don’t dictate to them. Almost all that you will be doing is constantly getting in synch about how they are doing things and exploring why.
123.Recognize that sometimes it is better to let people make mistakes so that they can learn from them rather than tell them the better decision.
However, since the connections between cause and effect can be misunderstood, providing feedback for these people is essential to the learning process.
123A. When criticizing, try to make helpful suggestions. Your goal is to help your people understand and improve, so your suggestions are important. Offering suggestions also helps those being criticized to understand that your goal is to help them and Bridgewater, not to hurt them.
123B. Learn from success as well as from failure. Point out examples of jobs that are well done and the causes of success. This reinforces good behavior and creates role models for those who are learning.
124.Know what types of mistakes are acceptable and unacceptable, and don’t allow the people who work for you to make the unacceptable ones.
When considering what failures you are willing to allow in order to promote learning through trial and error, weigh the potential damage of a mistake against the benefit of incremental learning. In defining what latitude I’m willing to give people, I say, “I’m willing to let you scratch or dent the car, but I won’t put you in a position where I think there’s a significant risk you could total it.”
125.Recognize that behavior modification typically takes about 18 months of constant reinforcement.
The first step is intellectualizing the best way of doing things. If you’re out of shape you must understand that you are out of shape, you must want to get in shape, and you must understand the way to get in shape: “I want to be fit by eating well and exercising.” Then the intellect will fight with desires and emotions. With determination, the intellect will overcome the impediments to doing what’s necessary to achieve the goal, and the desired behavior will occur. After doing that consistently for 18 months, the new behavior will be internalized.
126.Train people; don’t rehabilitate them.
Training is part of the plan to develop people’s skills and to help them evolve. Rehabilitation is the process of trying to create significant change in people’s values and/or abilities. Since values and abilities are difficult to change, rehabilitation typically takes too long and is too improbable to do at Bridgewater. If attempted, it is generally best directed by professionals over extended periods of time. People with inappropriate values and inadequate abilities to meet their job requirements have devastating impacts on the organization. They should be properly sorted (see the principles section on sorting).
126A. common mistake: training and testing a poor performer to see if he or she can acquire the required skills without simultaneously trying to assess their abilities.
Skills are readily testable, so they should be easy to determine. Knowing them is less important than knowing people’s abilities. That makes picking people with the right skills relatively easy. Abilities, especially right-brained abilities, are more difficult to assess. When thinking about why someone is a poor performer, openly consider whether it is a problem with their abilities. Values are the toughest and take the longest to assess.
127.After you decide “what’s true” (i.e., after you figure out what your people are like), think carefully about “what to do about it.”
As mentioned before, it’s important to separate thinking about “what’s true” and thinking about “what to do about it.” Figuring out what’s true takes time—often several months filled with a large sample size. Figuring out what to do about it (i.e., designing) is much faster—typically hours or days—but it isn’t instantaneous. Too often people either jump to decisions or don’t make them.
128.SORT PEOPLE INTO OTHER JOBS AT BRIDGEWATER, OR REMOVE THEM FROM BRIDGEWATER
129.When you find that someone is not a good “click” for a job, get them out of it ASAP.
If you are expecting/wishing people to be much better in the near future than they have been in the past, you are making a serious mistake—instead, sort the people. People who repeatedly operated in a certain way probably will continue to operate that way because that behavior reflects what they’re like. Since people generally change slowly (at best), you should expect slow improvement (at best), so instead of hoping for improvement, you need to sort the people or change the design to supplement them. Since changing the design to accommodate people’s weaknesses is generally a bad idea, it is generally better to sort the people.
Sometimes good people “lose their boxes” because they can’t evolve into responsible parties soon enough. Either there is a problem with their qualities or it will take too long to train them well. Some of these people might be good at another position within Bridgewater. Remember that identifying failure and learning from it are part of the evolutionary process. Make sure you record the reasons on the relevant “baseball card” and think about what a good next step would be for that individual.
130.Know that it is much worse to keep someone in a job who is not suited for it than it is to fire someone.
Don’t collect people. Firing people is not a big deal—certainly nowhere near as big a deal as keeping badly performing people, because keeping a person in a job they are not suited for is terrible both for the person (because it prevents personal evolution) and our community (because we all bear the consequences and it erodes meritocracy). Consider the enormous costs of not firing someone unsuited for a job: the costs of bad performance over a long time; the negative effect on the environment; the time and effort wasted trying to train the person; and the greater pain of separation involved with someone who’s been here awhile (say, five years or more) compared with someone let go after just a year.
131.When people are “without a box,” consider whether there is an open box at Bridgewater that would be a better fit. If not, fire them.
Remember that we hire people not to fill their first job at Bridgewater nor primarily for their skills. We are trying to select people with whom we’d like to share our lives. We expect everyone to evolve here. Because managers have a better idea of people’s strengths and weaknesses and their fit within our culture than what emerges from the interview process, you have invaluable information for assessing them for another role at Bridgewater.
132.Do not lower the bar.
If a person can’t operate consistently with our requirements of excellence and radical truth and can’t get to the bar in an acceptable time frame, they have to leave. We want to neither lower the bar nor enter into a long-term rehabilitation program.