- Billionaire hedge fund founder Ray Dalio is known for his “radical transparency” when it comes to corporate culture as much as for his investing prowess.
- Dalio, the founder of Bridgewater, has built an algorithmic way of evaluating employees, who can in turn evaluate him in real time, and is planning to release the platform to the public in about three months.
- “I would know what you’re thinking, you’d know what everyone else is thinking,” he said.
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Ray Dalio wants you to know what your co-workers and boss think about you all the time, in real time.
The billionaire founder of Bridgewater said he will soon be releasing to the public the employee feedback platform that the firm uses — starting with its well-known dot system in about three months. With that dot system, employees and bosses rate each other based on factors like assertiveness, intelligence, and open-mindedness.
In a talk to a room full of investors and peers at the Greenwich Economic Forum on Tuesday afternoon, Dalio laid out why he thinks his strategy — which uses the same basic quantitative decision-making algorithms that the investment teams use — would work in any corporate setting.
“It offers in-the-moment, computer-driven coaching on how to best handle a situation,” he said. A video was played on the dot system, in which a Bridgewater employee — “Jenn, the 24-year-old fresh out of college” — challenges Dalio on the platform after he presents an idea. The presentation prompted some surprised laughter out of the crowd in the Delamar Hotel ballroom.
“Yep, we really do that,” Dalio said to skeptical audience members after the video finished.
The system, which includes tools that break down potential employees from their first interview to the end of their career, is laid out in one of Dalio’s books on principles, which also is in app form. One of the tools, used when evaluating potential new employees, breaks down people by attributes so you can see them by their “Lego bits,” Dalio said.
“You can say ‘Ok, what are their attributes [I like] because I want another one of those,” he said.
Other tools include things like the daily update, so Dalio can keep track of people’s stress levels, and the pain button, which employees click on when they are frustrated with a task.
“Nature gave us psychological pain for a reason,” Dalio said, describing the button, but added that it also forces you to come up with a plan to deal with it. If a task continues to frustrate an employee, then it is recorded.
“It creates a kind of bio feedback,” he said.
While Dalio called his corporate culture “radical,” the billionaire is also confident it can work in any office or environment. When asked by the audience why he believes in the system’s universality, he noted that the book on principles has been translated into 34 languages, and that he was told by people in China it was among the best-selling books in the country.
Bosses and employees, he said, have to be comfortable with how they act and how people think about them. He asked how people would react if “I would know what you’re thinking, you’d know what everyone else is thinking” during the talk.
“Not everyone likes to look in the mirror.”
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