The 80/20 Rule And How It Can Change Your Life - Forbes

This “universal truth” about the imbalance of inputs and outputs is what became known as the Pareto principle, or the 80/20 rule. While it doesn ... BETAThisisaBETAexperience.Youmayopt-outby clickinghereMoreFromForbesMay31,2022,08:15amEDTSevenStrategiesThatWillStrengthenANewHire'sAbilityToSucceedMay31,2022,08:15amEDTTheMostConstructiveClientFeedback15CoachesHaveReceivedMay31,2022,08:15amEDT11EssentialFactorsWhenTurningASideHustleIntoAFull-TimeGigMay31,2022,08:15amEDTALeader’sGuideToSayingNoAndStayingSaneMay31,2022,08:00amEDTTheMostImportantElementsOfADigitalB2BLeadGenerationStrategyMay31,2022,08:00amEDTFiveTipsForLeveragingSMSMarketingIn2022May31,2022,08:00amEDTCanAPositiveLeaderImpactMentalHealth?May31,2022,08:00amEDTTheWorkplace'sImpactOnEmployeeExperiencesEditStoryCareersThe80/20RuleAndHowItCanChangeYourLifeKevinKruseContributorOpinionsexpressedbyForbesContributorsaretheirown.CEOofLEADxandauthorofGreatLeadersHaveNoRules.Mar7,2016,08:23pmEST|TweetThis80%ofresultswillcomefromjust20%oftheaction.Areyoutryingtogrowyourcurrentbusiness?Wouldan80/20mindsethelpyoutostayfocusedonyourstrategicplanandspendlesstimechasingendlessnewopportunities?SharetoFacebookSharetoTwitterSharetoLinkedinWhatisthe80/20Ruleandcoulditactuallymake80%ofyourworkdisappear? Ifyou’vestudiedbusinessoreconomics,you’rewellfamiliarwiththepoweroftheParetoPrinciple. TheManBehindTheConcept VilfredoFedericoDamasoParetowasborninItalyin1848.Hewouldgoontobecomeanimportantphilosopherandeconomist.Legendhasitthatonedayhenoticedthat20%ofthepeaplantsinhisgardengenerated80%ofthehealthypeapods.Thisobservationcausedhimtothinkaboutunevendistribution.Hethoughtaboutwealthanddiscoveredthat80%ofthelandinItalywasownedbyjust20%ofthepopulation.Heinvestigateddifferentindustriesandfoundthat80%ofproductiontypicallycamefromjust20%ofthecompanies.Thegeneralizationbecame: 80%ofresultswillcomefromjust20%oftheaction. Photo:Pixabay/Kaboompics Gallery:10EasyWaysToBeMoreProductiveAtWork 10images Viewgallery Pareto’s80/20Rule This“universaltruth”abouttheimbalanceofinputsandoutputsiswhatbecameknownastheParetoprinciple,orthe80/20rule.Whileitdoesn’talwayscometobeanexact80/20ratio,thisimbalanceisoftenseeninvariousbusinesscases: •20%ofthesalesrepsgenerate80%oftotalsales. •20%ofcustomersaccountfor80%oftotalprofits. •20%ofthemostreportedsoftwarebugscause80%ofsoftwarecrashes. •20%ofpatientsaccountfor80%ofhealthcarespending(and5%ofpatientsaccountforafull50%ofallexpenditures!) Onamorepersonalnote,youmightbeabletorelatetomyunintentional80/20habits. Iownatleastfiveamazingsuits,but80%ofthetimeormoreIgrabmyblack,well-tailored,single-breastedArmaniwithapowderblueshirt.(Ladies,howmanyshoesdoyouown,and howoftendoyougrabthesame20%?) Ihave15roomsinmyhouse,butIspendabout80%ofmytimeinjustmybedroom,familyroom,andoffice(exactly20%). I’mnotsurehowmanymilesofroadsareinthesmalltownwhereIlive,butIbetIonlydriveon20%orlessofthem,asImakedailytripstomykids’schools,thegrocerystore,thebankandgasstation. Onmysmartphone,Ihave48differentmobileappspinnedtothetiles,but80%ofthetimeI’monlyusingtheeightonmyhomescreen. WhenIgogroceryshopping,Idefinitelyspendthemosttimeintheaislesthatarearoundtheedgesofthestore:produce,thefishmarket,dairy,breads—andgenerallyskiptheaislesinthemiddleofthestore(exceptforhealthandbeauty). Asamassiveintrovert,Idon’tactuallysocializetoomuch,butwhenIdo,80%ofmytimeisspentwiththesame20%ofmyfriendsandfamilymembers. Inmyresearchintotheproductivityhabitsofhighachievers,Iinterviewedhundredsofself-mademillionaires,straight-AstudentsandevenOlympicathletes.Forthem,handlingeverytaskthatgetsthrowntheirway—oreveneverytaskthattheywouldliketohandle—isimpossible.TheyuseParetotohelpthemdeterminewhatisofvitalimportance.Then,theydelegatetherest,orsimplyletitgo. HowYouCanUseIt SohowcanyouapplyPareto’sprincipletogainmoretimeinyourlife? Areyouanexecutive?You’resurelyfacedwiththeconstantchallengeoflimitedresources.It’snotjustyourtimeyouneedtomaximize,butyourentireteam’s.Insteadoftryingtodotheimpossible,aParetoapproachistotrulyunderstandwhichprojectsaremostimportant.Whatarethemostimportantgoalsofyourorganization,orboss,andwhichspecifictasksdoyouneedtofocusontoalignwiththosegoals.Delegateordroptherest. Areyouafreelancer?It’simportanttoidentifyyourbest(andhighest-paying)clients.Ofcourse,youdon’twantallyoureggsinonebasket.Buttoomuchdiversificationwillquicklyleadtoburnout.Focusonthemoneymakersandstrengtheningthoselong-termrelationships. Areyouanentrepreneur?Thetemptationalwaysexiststotrythenewandexciting.There’snothinginherentlywrongwiththat,butitboilsdowntoyourgoals.Areyoutryingtogrowyourcurrentbusiness?Wouldan80/20mindsethelpyoutostayfocusedonyourstrategicplanandspendlesstimechasingendlessnewopportunities? Nomatterwhatyoursituation,it’simportanttorememberthatthereareonlysomanyminutesinanhour,hoursinaday,anddaysinaweek.Paretocanhelpyoutoseethisisagoodthing;otherwise,you’dbeaslavetoanever-endinglistofthingstodo. So,what20%ofyourworkdrives80%ofyouroutcomes? -- KevinKruse isthehostoftheExtremeProductivityPodcastand authorofInfographic:15ThingsUltraProductivePeopleDoDifferently.KevinKruseEditorialStandardsPrintReprints&Permissions