I’m sure most of us have heard of the 80/20 rule. Often described as the Pareto Principle, it’s a concept illustrating how certain things provide a higher level of results than others. It helps us invest our time, energy, and money into things that will pay off.
It seems like a pretty good concept to me. If results are disproportionate to effort invested, it merits our attention. 20% of effort leading to 80% of results is a powerful idea, and makes me want to try to identify what that 20% is! Now, it may not always be 80/20. Perhaps the split is different depending on the situation. Sometimes is might be 90/10, other times 70/30, or anything else.
There is probably a lot to this that could be explored. Here are some examples of the 80/20 rule:
I suspect that in many companies, the impact on the success of a business is not equally sourced across employees. Some are good, some are average, some are deadweight. Yet, some are probably stars, more productive than others in helping the business reach its goals.
This could also be applied to customers. Some customers take a lot of time and effort to market to, but aren’t super profitable. Yet others are really profitable and yield big results for less time invested.
In terms of our own money, there are many applications of the 80/20 rule. One that comes to mind is our careers. When thinking about the 80/20 rule and careers, we can realize that there is a different return on investment of our different activities. For example, when job searching, a person could go online and apply to a bunch of jobs, or get in touch with their network to get an “in” at a company they’re interested in. Often times, working through someone you know could be more efficient that applying as a random candidate.
Another manifestation of the 80/20 rule and our careers would be the reality that there are certain things that matter more to the boss than others. If we spend our time focused on getting done a lot of things, that might be okay. However, it may be better sometimes to hit it out of the park with the few things that are most important to our boss, and let some of the other things go – or be highly deprioritized. Again, 80% of “impact” could come from a core of 20% of the things we have to do.
Let’s say we are trying to get (or keep) in shape. We could invest a ton of time working out, taking vitamin supplements, etc. However, if we disregard nutrition, we might be making little progress. Perhaps balancing how we spend our time, and reallocating it, might allow us to get a better return on our time invested. Which, ideally, could help us reach fitness goals more quickly.
This could also apply toward spending time with certain people, dating, etc. There are some situations that are just a better use of time than others.
My Questions for You
Do you ever think about the 80/20 rule?
Where do you apply this rule, and invest your time efficiently to get results?
Where in your life do you think you could do a better job of applying the Pareto Principle?