Once facts and viewpoints are put out there through radical truth and thoughtful disagreement, how do you reconcile them to make the best decisions?
To maintain order and allow the best decisions to surface, people must agree on procedures to resolve disagreements, and abide by the conclusions of the procedures. At Bridgewater, the procedure they use is believability-weighted decision making.
“Believability-weighted” means to weigh the opinions of people who are more believable more heavily than less believable people. This is distinctly different from weighing everyone’s votes equally, as in a democracy.
Who are believable people? They are people who 1) have repeatedly succeeded at the thing in question, and 2) can logically explain their conclusions. It makes sense to value the opinions of successful people more than those with little experience.
At Bridgewater, Baseball Cards and the Dot Collector tool help people see each other’s track records and believable areas. Recall that the Dot Collector is a tool used during meetings where people can award each other dots (positive or negative) on a few dozen attributes, such as expertise in the topic area, creativity, open-mindedness, and so on.
People who are rated as more believable in an attribute have more weight behind the dots they give for that attribute. Over many meetings and many ratings by other people, a person’s strengths and weaknesses become very visible through the Dot Collector.
When stating your beliefs, also state the degree of conviction behind them. Do you offer it merely as a suggestion, or do you have diehard conviction behind it? This will make clear how strongly people should weigh your opinion.
When listening to other people, listen to the reasoning moreso than the conclusion. Ask questions like, “What data are you looking at? How do you draw your conclusions from this data?”
Recognize that great ideas can come from inexperienced people, since they are not set in their ways as much as veterans are.
If you are less believable in an area, be humble about your position. If you can’t successfully do something, it’s arrogant to tell others how it should be done, and you have little right to be listened to. Could you lecture Michael Jordan on how to shoot free throws? Dalio cautions, don’t hold opinions about things you don’t know anything about.
In these situations, you are the student, and more believable people are the teachers—spend more time asking questions to understand their logic than pressing your own ideas.
In discussions, you should not expect equal treatment of your ideas if you’re not as believable. You shouldn’t expect the teacher to try equally hard to understand you as you try to understand her.
How can you become more believable? Stress-test your ideas with other believable people and test it with real data, and your idea will become more believable. You can also articulate clear logic behind your idea, and you will be more believable than if you just had a hunch.
After the discussion has ended, it’s time to put it to a vote. Collect the votes from everyone, then weigh each person’s vote by how believable they are for this decision.
Compare the democratic equally-weighted result with the believability-weighted vote. If the two align, then the answer is easy—you have a final decision, and you can move on. If the two disagree, then you should generally go with the believability-weighted vote.
At Bridgewater, the Dot Collector tool automates all of this by collecting votes from each person at the meeting. It then shows everyone’s votes, as well as the believability-weighted results.
The vote is just a strong suggestion—the meeting still has a person who’s ultimately responsible for making the final call. In some cases, this final decision-maker can override a believability-weighted vote, but this comes with risk—they can later be proven wrong by the outcome. This overriding also runs against the spirit of the idea meritocracy. If you override the believability-weighted decision, you should be able to define what specifically you disagree with, explain your logic to others, then state that you understand the risks of being wrong.
At the end of the day, know when it’s time to stop debating and to move on. Get the big things right, and don’t worry about perfecting the small things. But—if you disagree on whether it’s important to debate something, it probably should be debated.
Finally, if the decision you wanted isn’t what’s decided, you must support the decision. This signals that you believe in the validity of the system more than you care about getting your way. The success of the group is more important than your individual desire.
Believability-weighted decision making is the system Dalio recommends to resolve disagreements. But some lingering resentment may still arise. Here’s how to deal with it.
See disagreements from top-down as “just another one of those,” and have procedures ready to resolve them.
Don’t leave important conflicts unresolved—escalate the conflict to a higher authority, or put it to a vote.
Don’t let little disagreements divide you when big agreements should bind you. This is also known as the “narcissism of small differences.” Dalio cites the example of how Protestants and Catholics should really band together because they follow Christ, but instead they quarrel over the small details.
People must abide by the policies and procedures, just as though it’s a dispute taken to court. Two people can’t agree to ignore the principles, just like two people can’t agree to break the law. If people have enough power to undermine a system and care more about themselves than preserving the system, the system will fail.
Finally, remember that the goal is to get to the truth, not to prove someone is right or wrong. If everyone can earnestly believe this, there should be little ultimate conflict when a decision is made.