The Pareto principle - What Is THE Most Important?

What Is Most Important?

20% of the food you eat creates 80% of the fat!
20% of your neighbours make 80% of the noise.
20% of the people in your office do 80% of the work.
This is the 80/20 rule. You'll see it everywhere!


In 1897 an Italian economist called Pareto discovered that 20% of people in England had 80% of the money. He also found that 20% of pea pods in his garden produced 80% of his peas. Now he is famous!

His Pareto Principle predicts that ... in any situation, just a few things are much more important than all the rest.

This means:
In business: 20% of customers give you 80% of the profits.
Look after that 20%!

For students: 20% of a book's pages contain 80% of the information. Concentrate on that 20% - then read the next book.

For you: YOUR DAILY TASKS ARE NOT EQUALLY IMPORTANT. If you have ten jobs to do today, two of them will be more critical than the other eight!

Every day, figure out the 20%. Do those things FIRST.

Simply making a "to do list" is not good enough. Unless you target the 20%, you can waste 80% of your time!

Average people put average effort into lots of things.
Achievers put major effort into key things.

You can't do everything - but you can do the 20%. Don't lose sleep over the 80%.

IN A NUTSHELL

It's not just the amount of effort that matters, but where you put it.




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Understanding the Pareto Principle (The 80/20 Rule)

Home›Observations›Understanding the Pareto Principle (The 80/20 Rule)

Originally, the Pareto Principle referred to the observation that 80% of Italy’s wealth belonged to only 20% of the population.
More generally, the Pareto Principle is the observation (not law) that most things in life are not distributed evenly. It can mean all of the following things:

• 20% of the input creates 80% of the result
• 20% of the workers produce 80% of the result
• 20% of the customers create 80% of the revenue
• 20% of the bugs cause 80% of the crashes
• 20% of the features cause 80% of the usage
• And on and on…

But be careful when using this idea! First, there’s a common misconception that the numbers 20 and 80 must add to 100 — they don’t!
20% of the workers could create 10% of the result. Or 50%. Or 80%. Or 99%, or even 100%. Think about it — in a group of 100 workers, 20 could do all the work while the other 80 goof off. In that case, 20% of the workers did 100% of the work. Remember that the 80/20 rule is a rough guide about typical distributions.
Also recognize that the numbers don’t have to be “20%” and “80%” exactly. The key point is that most things in life (effort, reward, output) are not distributed evenly – some contribute more than others.