The “incredible beauty” of mistakes

From Principles, by Ray Dalio:

I learned that everyone makes mistakes and has weaknesses and that one of the most important things that differentiates people is their approach to handling them. I learned that there is an incredible beauty to mistakes, because embedded in each mistake is a puzzle, and a gem that I could get if I solved it, i.e., a principle that I could use to reduce my mistakes in the future. I learned that each mistake was probably a reflection of something that I was (or others were) doing wrong, so if I could figure out what that was, I could learn how to be more effective. I learned that wrestling with my problems, mistakes, and weaknesses was the training that strengthened me. Also, I learned that it was the pain of this wrestling that made me and those around me appreciate our successes.

In short, I learned that being totally truthful, especially about mistakes and weaknesses, led to a rapid rate of improvement.

Notes:
(1) Thank you Guy Cohen for the tip.
(2) I often say to people in Seeking Alpha: “Bad is good!”. It sounds Orwellian, but it means this: If we’re doing something badly, there’s opportunity to fix it, and opportunity for upside. If we’re doing everything perfectly, there’s no opportunity for upside. So problems and mistakes = upside potential.
(3) The key is to ascribe mistakes and problems to weaknesses in a process, not to personal failings. The mistake is therefore a gift — it exposed a weakness in your underlying process which you can now fix.
(4) Is there a psychological similarity to How to view rejection?

3 thoughts on “The “incredible beauty” of mistakes

  1. I think this post has one of the most important lessons – applicable to all kinds of investing but also to many aspects of life. In investing, for example in the stock market, we all make mistakes but the key to success is learning from the mistakes and actually making changes to behavior. It is easier said than done because we all have our own personalities and habits an we tend to repeat mistakes, sometimes in a long loop. I for one am still working on this.

  2. I don’t think Dalio’s point is profound, or else it’s another way of saying something we learn as children as far as learning from mistakes. But I love the ‘bad is good’ concept. I’m not even sure why, except if done right, looking at ‘bad’ as an opportunity is very powerful.

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