Bridgewater Case Analysis
Bridgewater Case Analysis
Introduction Bridgewater Associates is the world’s largest and most successful hedge fund organization, but has a very different culture that you will not find at any other corporation. They follow a radical transparency and truth at all cost theory. The founder, Ray Dalio, believes that his unique culture is the reason for Bridgewater’s success. Through closely reviewing the facts, SWOT analysis, and several options that Bridgewater could do, I recommend that they should not change their culture because it has given them success and a competitive advantage.
I. Situational Analysis
Bridgewater has become the world’s largest hedge fund organization. It was founded in 1975 by Raymond Dalio in his two bedroom Manhattan apartment. In the 1980’s, he operated primarily as a risk management consultant until 1985 when the World Bank gave him the opportunity to manage part of their employee retirement fund. That success kept attracting other clients such as Kodak’s retirement fund in 1989. In 1990, he registered Bridgewater with the SEC and in 1991 is when he launched Pure Alpha hedge fund strategy. During 1990’s and 2000’s the company was consistently recognized for its excellent client service. In 2008 during the worst year of the financial crisis, Bridgewater made 9.4% for its investors (Polzer). In 2011, Dalio had decided that he would not be able to be the CEO for Bridgewater forever. In 2011 he published a 122 page document what is known as the “Principals.” “Principals” was Dalio’s attempt to institutionalize the culture which Dalio codified his management and principles. The “Principals” was mandatory reading and was formed the basis of nightly homework assignments to quiz people on their understanding of it. In 2012, the company is run by the firm’s Management Committee and three co-CEOs, Greg Jensen, Eileen Murray, and David McCormick. Dalio stayed as a Mentor and co-Chief Investment officer. To work at
Introduction Bridgewater Associates is the world’s largest and most successful hedge fund organization, but has a very different culture that you will not find at any other corporation. They follow a radical transparency and truth at all cost theory. The founder, Ray Dalio, believes that his unique culture is the reason for Bridgewater’s success. Through closely reviewing the facts, SWOT analysis, and several options that Bridgewater could do, I recommend that they should not change their culture because it has given them success and a competitive advantage.
I. Situational Analysis
Bridgewater has become the world’s largest hedge fund organization. It was founded in 1975 by Raymond Dalio in his two bedroom Manhattan apartment. In the 1980’s, he operated primarily as a risk management consultant until 1985 when the World Bank gave him the opportunity to manage part of their employee retirement fund. That success kept attracting other clients such as Kodak’s retirement fund in 1989. In 1990, he registered Bridgewater with the SEC and in 1991 is when he launched Pure Alpha hedge fund strategy. During 1990’s and 2000’s the company was consistently recognized for its excellent client service. In 2008 during the worst year of the financial crisis, Bridgewater made 9.4% for its investors (Polzer). In 2011, Dalio had decided that he would not be able to be the CEO for Bridgewater forever. In 2011 he published a 122 page document what is known as the “Principals.” “Principals” was Dalio’s attempt to institutionalize the culture which Dalio codified his management and principles. The “Principals” was mandatory reading and was formed the basis of nightly homework assignments to quiz people on their understanding of it. In 2012, the company is run by the firm’s Management Committee and three co-CEOs, Greg Jensen, Eileen Murray, and David McCormick. Dalio stayed as a Mentor and co-Chief Investment officer. To work at
References: Bridgewater Associates LP. (n.d.). Retrieved January 24, 2015, from http://www.vault.com/company-profiles/hedge-funds/bridgewater-associates-lp/company-overview.aspx Cassidy, J. (2011, July 25). Mastering the Machine. Retrieved January 24, 2015, from http://www.newyorker.com/magazine/2011/07/25/mastering-the-machine Gross, D. (2013, March 7). Bridgewater May Be the Hottest Hedge Fund for Harvard Grads, but It’s Also the Weirdest. Retrieved January 24, 2015, from http://www.thedailybeast.com/articles/2013/03/07/bridgewater-may-be-the-hottest-hedge-fund-for-harvard-grads-but-it-s-also-the-weirdest.html Polzer, J. & Gardner, H. (n.d.). Bridgewater Associates. Retrieved January 24, 2015, from https://eproduct.hbsp.harvard.edu/eproduct/product/m_bridgewater/content Schein, E. (2010) Organizational Culture and Leadership: 4th Edition Published by Jossey-Bass. San Francisco, CA