I have been reading a book called Principles, by Ray Dalio, the CEO of Bridgewater Associates, one of the world’s largest hedge funds. I’m sure a large percentage of people reading this post have read the book and realise its value. The book, as its title implies, talks through principles for life and business. The first principle mentioned in the book is:
What do you want
What is true
What should you do to achieve 1. in light of 2.
I have tried to reflect whether and how this principle has been utilised by me in the past and have come to some eye-opening conclusions.
Case 1 - The ‘Don’t Do It’ advice.
I have a client that I was assisting in a transaction to negotiate the sale of his business. He was keen for the transaction to proceed after the first discussion with the interested party, but the valuer in me saw that the deal could be a whole lot better than was currently proposed. With this in mind, I got an engagement signed that meant Alpin received a share of any consideration above the proposed offer.
As negotiations progressed, it became more and more evident to me that as well as the value of the deal, it was the human relationships that would be broken/changed that were of real importance to the owner. Also, he was not ready to walk away just yet.
The dealmaker in me should have been telling me to encourage him to do the deal - I would have received more money, had another successful deal as a credential and been able to use it to market the business, but my first reaction was to advise against the sale as it was not in the best interests of my client.
A summary of Ray Dalio’s first principle and my thinking was:
We didn’t get as much money or recognition as we could have, but I felt like I had done the right thing. I am on good speaking terms with the client and we are still doing work with him.
Case 2 - Take the client and bugger the consequences
Luckily, this one was when I was working at a previous job - not at Alpin!
This business was owned by a personal friend of mine and needed some transactional advice that I knew I personally couldn’t provide. I referred my friend to another team within my company and left another person to manage the relationship and engagement. More importantly, I didn’t have the utmost confidence in the person that I had referred my mate to, so I was hoping like hell that the engagement would be beneficial.
I don’t have the email that I received from my mate, but to paraphrase his email to me, it read something like:
From what I have seen to date on the [engagement type] that is being done by [name] I am completely underwhelmed. There seems to be no understanding of what we need, there is no proactivity in communications and the quality of the deliverable is, to be honest, shit.
If you could have a look at how this can be fixed that would be appreciated.
Looking again at Ray Dalio’s principles and my assessment:
The job was a complete shit show.
Luckily my relationship with my mate was strong enough that even though I chose the opposite path to what my principles told me I should have done, and the entire engagement ended poorly, I was able to recover my personal relationship.
Looking at my principles recently has taught me some really valuable lessons which the above cases have highlighted.
The principles that I have now set for myself from a work perspective are:
Only work with clients that I have respect for
Regardless of the monetary reward, do the right thing by my clients, not myself
Be honest and frank with my clients, tell them the truth, not what they want to hear
Since I came up with these (pretty simple) principles, I have turned away clients (that I have never done before), had some very forthright discussions with clients that they didn’t appreciate in the first instance (but then came around) and most importantly felt really good about myself that I am contributing to my clients growth.