Principles are fundamental truths that serve as the foundations for behaviour that gets what you want in life and work. They can be applied again and again in similar situations to help you achieve your goals.
Every day, each of us is faced with hundreds of situations we must respond to. Without principles, we would be forced to react to all the things life throws at us individually, as if we were experiencing each of them for the first time. If instead we classify these situations into types and have good principles for dealing with them, we will make better decisions more quickly and have better lives as a result. There are much more people that types of people, there are much more situations that types of situations, with experience you will be able to see every situation as “another one of those” – another of a certain type of situation like hiring, firing, determining compensation, dealing with dishonesty – that has principles for handling them. At a certain point, we will have principles to deal with any type of situation (Dalio, 2017).
All successful people operate by principles that help them be successful, though what they choose to be successful at varies enormously, so their principles vary. To be principled yourself means to consistently operate with principles that can be clearly explained. Principles must be clearly laid out so that their logic can easily be assessed and you and others can see if you “walk the talk”. By sharing them with all Fuell team members and inviting them to improve them, we can continually refine and evolve them. Our principle-driven approach to decision making has not only improved our economics, managing decisions, etc. is has helped us make better decision in every aspect of our lives (Dalio, 2017).
Whenever something new comes along that requires you to make a decision, reflect on and refine the principles, communicate it to others (i.e. when you explain in an email your decision-making process). This will begin an ongoing evolutionary process of encountering many situations, forming principles about how to deal with them, and getting in Sync with other Fuell leaders and managers about them (Dalio, 2017). This will allow us to foster our idea meritocracy.
We also recommend you to give every principle a short name so that everyone could easily remember them and communicate them to others. Remembering those bold words will allow you to easily evoque them in any kind of situation, whether you’re discussing ideas for new projects or deciding on the best approach to solving any problem.
If you are interested in this way of operating we recommend you to read the book “Principles: Life and Work” by Ray Dalio, and learning more of how Amazon works.
The first version of our leadership principles
Customer Obsession: Leaders start with the customer and work backwards. They work vigorously to earn and keep customer trust. Although leaders pay attention to competitors, they obsess over customers.
Embrace radical truth and radical transparency: Leaders know that truth is the essential foundation for any good outcome. Leaders know that to succeed we must embrace reality and deal with it. Most people fight seeing what’s true when it’s not what they want it to be. They understand that to improve their understanding of reality they need continuous feedback loops. Being radically transparent, rather than more guarded, can be difficult because it exposes one to criticism. However, they know they must be willing to express themselves and try to do things in the unique way they think are best – and to open-mindedly reflect on the feedback that comes inevitably as a result. Being radically transparent besides giving them the freedom to be them, allows them to understand others and for others to understand them, which is much more efficient and enjoyable that not having this understanding.
Think Big: Thinking small is a self-fulfilling prophecy. Leaders create and communicate a bold direction that inspires results. They think differently and look around corners for ways to serve customers.
Bias for Action: Speed matters in business. Many decisions and actions are reversible and do not need extensive study. We value calculated risk-taking.
Hire and Develop the Best: Leaders raise the performance bar with every hire and promotion. Every time a leader is hiring someone he asks himself “Is this the right candidate?” if the answer is not a “hell yes!” he knows the answer is most likely a “no”. They recognize exceptional talent and willingly move them throughout the organization. Leaders develop leaders and take seriously their role in providing accurate and constant feedback. We work on behalf of our people to invent mechanisms for development like Career Choice. Leaders constantly train, test, evaluate and sort people. Leaders hire people because they are brilliant in their strengths, and not for not having weaknesses.
Earn trust: Leaders don´t just give orders and expect to be followed; they try to be understood and to understand others by getting in Sync. Leaders listen attentively, speak candidly, and treat others respectfully. They are vocally self-critical, even when doing so is awkward or embarrassing. Leaders do not believe their or their team’s body odor smells of perfume. They benchmark themselves and their teams against the best.
Deliver Results: Leaders focus on the key inputs for their business and deliver them with the right quality and in a timely fashion. Despite setbacks, they rise to the occasion and never settle.
Insist on the Highest Standards: Leaders have relentlessly high standards — many people may think these standards are unreasonably high. Leaders are continually raising the bar and drive their teams to deliver high-quality products, services, and processes. Leaders ensure that defects do not get sent down the line and that problems are fixed so they stay fixed. Leaders force themselves and the people who work for them to do challenging things.
Systemize learning from mistakes: Leaders do no set the tone that mistakes are not tolerated. Leaders create a culture in which it is okay to make mistakes and unacceptable not to learn from them. Since mistakes happen all the time, that would only let to even bigger and more costly errors. Leaders believe strongly that they should bring problems and disagreements to the surface to learn what should be done to make things better. They get over “blame” and “credit” and get on with “accurate” and “inaccurate”. Of course, they know there are also mistakes that are not acceptable. When considering the kind of mistakes that are unacceptable, leaders must weight the potential damage against the benefit of incremental learning.
Speak up, own it, and commit: Leaders create an environment in which everyone has the right to understand what makes sense and no one has the right to hold a critical without respectfully speaking up. In an idea meritocracy, openness is a responsibility; they know that not only do they have the privilege to speak up and “fight for right” but are also obligated to do so (just like everything else, principles need to be questioned and debated). What they never do is complain and criticize privately – either to others or in their own head. If you can not fulfil this obligation, then you must go. Of course, exploring what is true is not the same thing as stubbornly insisting that you are right, even after the decision-making machine has settled an issue and moved on. Once a decision is determined (whether they believe is the best or not), leaders commit wholly.
Ownership: Leaders are owners. They think long term and don’t sacrifice long-term value for short-term results. They act on behalf of the entire company, beyond just their own team. They never say “that’s not my job”. Leaders are not restricted by organizational structure or role definitions.
Be creative and Simplify: Leaders expect and require innovation and invention from their teams and always find ways to simplify. They are externally aware, look for new ideas from everywhere, and are not limited by “not invented here.” As we do new things, we accept that we may be misunderstood for long periods of time.
Learn and Be Curious: Leaders are never done learning and always seek to improve themselves. They are curious about new possibilities and act to explore them.
Frugality: Accomplish more with less. Constraints breed resourcefulness, self-sufficiency, and invention. There are no extra points for growing headcount, budget size, or fixed expense.
Practice radical open-mindedness: Leaders radical open-mindedness is motivated by the genuine worry that they might not be seeing their choices optimally. They have the ability to explore diverse possibilities and perspectives and work to disconfirm their beliefs without letting their ego or their blind spots get in their way. They replace their attachment to always being right with the joy of learning what´s true. To be open-minded leaders must sincerely believe that they might not know the best possible path and recognize that their ability to deal well with “not knowing” is more important than whatever it is they know. The probability of them always having the right answer is small and, even if they have it, they cant be confident that they do before others test them. Leaders look for answers outside of themselves, explore ideas with the most believable people they have access to. When you do, if both parties are peers, it´s appropriate to argue. But if the other person is clearly more believable than you, it is preferable for the less believable person to approach the other person as a student, and he must approach you as a teacher. Obviously open-mindedness doesn’t mean going along with somebody else’s beliefs. It means considering the reasoning of others instead of stubbornly and illogically holding to your own point of view.
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Do you think our principles can be improved? please send us your feedback to email@example.com . Thank you!