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Pareto's Principle

by Will Edwards
16 replies
Posts appear around here fairly frequently on the subject of information overload and not knowing where to start etc, so I thought I'd post this quick tip.

There was a lady who once took over the business of her husband following his death. He had been a very successful man and people at the company were very worried about the future of the company once she took over its management . As it turned out, she was able to take the company forward to achieve ever greater goals.

She knew comparatively little about business and, in particular, her husband's business, but she was able to get the most out of the people around her. Here strategy was very simple: she told the top executives to do more of what was working well and less of what was not working so well or not working at all.

Recently, I have been thinking about this story and have realised that there are just a few activities that really bring in the results for me. You might say this is another example of Pareto's Principle in action (the famous 80/20 law) but defining and concentrating on that 20% has been an important step forward for me.

So I commend this simple three-step plan to you:

1. Define that 20% activity that yields results for you
2. Do more of it
3. Do less of the other stuff

... and watch your productivity dramatically increase!

Will
#pareto #principle
  • Profile picture of the author Will Edwards
    Hi Chris

    That's a perfect example.

    It's amazing what a bit of focus can achieve.

    Will
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  • Profile picture of the author Anonymous Affiliate
    Originally Posted by Will Edwards View Post

    1. Define that 20% activity that yields results for you
    2. Do more of it
    3. Do less of the other stuff
    Totally correct. What I personally do is to dedicate my personal efforts on the key 20% and to outsource or systematize the other 80%. That's what's worked for me.
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  • Profile picture of the author GarryMSayer
    Of course you're not just limited to using the 80/20 rule in business. It can be easily applied to your personal life and you'll be amazed at the speed with which you can change things for the better.

    For example which 20% of your bills cost 80% of your expenditure? Can you cut them down?

    Garry.
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  • Profile picture of the author Andyhenry
    Hey Will,

    I wrote about this on my blog before:


    I've been working a lot on how to be more effective with my online business and although this is going to sound really simple, I've found using the 80/20 rule and blanket applying it to all IM related activities has worked wonders.

    Here are some examples:

    1 - 20 percent of my work gets me 80 of the revenue, so I've worked out where I spend my time and shifted the focus over to the elements that make the most money.

    2 - 20 percent of my products make 80 of the revenue - again, trying to do everything impacted sales and just focusing on the high performers got much better results than putting the same effort into the dead ducks.

    3 - 80 percent of the people taking up my time were not contributing to my efforts, but the 20 percent who were looking for a win-win arrangement were making the most difference.

    4 - 20 percent of my promotional activities get 80 percent of the results - focus change to prioritise onto the best activities and don't waste time on the less effective activities.

    You get the idea.

    Think about it and see how it can help you.

    Andy
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    nothing to see here.

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    • Profile picture of the author Will Edwards
      Originally Posted by Andyhenry View Post

      Hey Chris,

      I wrote about this on my blog before:


      I've been working a lot on how to be more effective with my online business and although this is going to sound really simple, I've found using the 80/20 rule and blanket applying it to all IM related activities has worked wonders.

      Here are some examples:

      1 - 20 percent of my work gets me 80 of the revenue, so I've worked out where I spend my time and shifted the focus over to the elements that make the most money.

      2 - 20 percent of my products make 80 of the revenue - again, trying to do everything impacted sales and just focusing on the high performers got much better results than putting the same effort into the dead ducks.

      3 - 80 percent of the people taking up my time were not contributing to my efforts, but the 20 percent who were looking for a win-win arrangement were making the most difference.

      4 - 20 percent of my promotional activities get 80 percent of the results - focus change to prioritise onto the best activities and don't waste time on the less effective activities.

      You get the idea.

      Think about it and see how it can help you.

      Andy
      Hi Andy

      Some really great examples of 80/20 in action there. I have to say that I completely relate to those.

      Will
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    • Profile picture of the author easybiztools
      Originally Posted by Andyhenry View Post

      Hey Will,

      I wrote about this on my blog before:


      I've been working a lot on how to be more effective with my online business and although this is going to sound really simple, I've found using the 80/20 rule and blanket applying it to all IM related activities has worked wonders.

      Here are some examples:

      1 - 20 percent of my work gets me 80 of the revenue, so I've worked out where I spend my time and shifted the focus over to the elements that make the most money.

      2 - 20 percent of my products make 80 of the revenue - again, trying to do everything impacted sales and just focusing on the high performers got much better results than putting the same effort into the dead ducks.

      3 - 80 percent of the people taking up my time were not contributing to my efforts, but the 20 percent who were looking for a win-win arrangement were making the most difference.

      4 - 20 percent of my promotional activities get 80 percent of the results - focus change to prioritise onto the best activities and don't waste time on the less effective activities.

      You get the idea.

      Think about it and see how it can help you.

      Andy

      One more to add to your list ...


      - 80% of the emails received should be deleted without taking a 2nd look :-)


      Cheers,
      Adrian
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  • Profile picture of the author KenThompson
    Will,

    What struck me about your story is that someone stepped in with
    a fresh perspective and did a common sense thing. She went to
    the people who were knowledgeable and made a common sense
    request.

    It's so simple and seems like one of those things that's hiding in
    plain sight.

    Perhaps a good takeaway would be to step back from time to time
    and look at things from a different perspective, if possible. I realize
    it can be easier said than done, though.


    Ken
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  • Profile picture of the author Mukul Verma
    Dam, BUSTED. I am in the 80% reading this

    Cheers
    Mukul
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  • Profile picture of the author USGTMauthor
    Richard Koch has a great book about the 80/20 principal. Most libraries have it. One of my favs
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    Author of the Underground Guide to Success

    http://www.amazon.com/dp/B00RM2YYEW

    http://undergroundguidetosuccess.blogspot.com/

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  • Profile picture of the author cashcow
    What struck me about your story is that someone stepped in with
    a fresh perspective and did a common sense thing. She went to
    the people who were knowledgeable and made a common sense
    request.
    Exactly what i was thinking..... Now is she available to come look at my business? LOL!

    Lee
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    Gone Fishing
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  • Profile picture of the author tpw
    This is awesome advice that I have been actively working to implement in my business for years...

    I have made considerable improvements and have more to do...

    It is my contribution to the Evolution of my Business....
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    Bill Platt, Oklahoma USA, PlattPublishing.com
    Publish Coloring Books for Profit (WSOTD 7-30-2015)
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    • Profile picture of the author JoshuaG
      Warrior forum should just be renamed to the common sense forum...
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      • Profile picture of the author nyrsimon
        Originally Posted by JoshuaG View Post

        Warrior forum should just be renamed to the common sense forum...
        Unfortunately common sense is not common practice!!!!!!!!!
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  • Profile picture of the author Michael Field-Dodgson
    Hi Will,

    yes old Pareto, I applied it in my traditional business to great effect. It is great that a simple principle, once discovered, can be so effective.

    One thing I added after using the Pareto Principle was continuous improvement. The Japanese call it Kaizan. Where each time you undertake a process you impove upon it or make it slightly better.

    Cheers
    Signature

    AND there's no such thing as a free lunch!!
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    • Profile picture of the author Will Edwards
      Originally Posted by Michael Field-Dodgson View Post

      Hi Will,

      yes old Pareto, I applied it in my traditional business to great effect. It is great that a simple principle, once discovered, can be so effective.

      One thing I added after using the Pareto Principle was continuous improvement. The Japanese call it Kaizan. Where each time you undertake a process you impove upon it or make it slightly better.

      Cheers
      Hi Michael

      Yes the Japanese Kaizen principle is based on my namesake William Edwards Deming's ... Plan, Do, Check, Act philosophy of continual improvement.

      Good stuff.

      Will
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