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How to Understand and Embrace the 80/20 Rule

Updated: Apr 27, 2023

Just in case the 80/20 rule is a foreign idea to you, let’s first cover what it is. The 80/20 rule, which also goes by the name the Pareto Principle, is the principle that 20% of your efforts will account for 80% of your outcomes. That means 20% of the work you do will impact 80% of your success, and the other 80% will only account for 20%.

The difficulty with using this rule is to do so to your advantage:

If only 20% of your work is causing 80% of your success, wouldn’t it stand to reason that if you can isolate the 20% that will produce the 80%, you’d be more successful by spending your time on important work?

Confused? Let’s look at an example. We’ll go with an even 100 to demonstrate:

You send 100 emails and get a response back from 80. You make 100 phone calls and get a response back from 20. Which was a better use of your time? Now let’s say of the 20 you talked to, you sold 16 of them $100 worth of product each, whereas the 80 people that responded to your email only resulted in total sales of $320. Which was a better use of your time?

It’s important to understand that when we look at the 80/20 rule - especially when we are targeting a priority list - we need to consider the desired outcome to determine its effectiveness, so we can optimize our results. If your desired outcome is contacts vs. sales, then emailing is the better use of your time. However, if your concern is the profit then your time was better spent making phone calls.

Now, this isn’t to say that the other 80% should be discarded, as doing so would mean losing that 20%. But is it more practical to focus your attention on the 20% that will affect 80% of your outcomes? I think it’s safe to say that this would be a logical conclusion. The more you focus on the 20% that accounts for the majority of your outcomes, the higher your rate of success will be, whatever your definition of success.

Using the 80/20 rule to your advantage will require a clear and concise goal as well as a review of how each activity correlates to the desired outcome. Unfortunately for most of us, that 20% is not going to include tasks that we enjoy doing and for this reason alone the other 80% is such an important part of our lives. It’s what keeps us going and makes the other 20% worth doing so that we can continue to do the 80% that we love!

To learn more about the Pareto Principle please visit here. To learn how Milrich Associates can help you achieve maximum productivity, please visit here.


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