The Pareto Principle (the 80/20 Rule) - Deepstash

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The Pareto Principle (the 80/20 Rule)

The Pareto Principle (the 80/20 Rule)

It is an idea discovered by an Italian economist. It says that power and wealth is distributed like a reversed hockey stick where a small percentage of the population (20%) owns majority of the wealth (80%). 

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In Pareto Principle, the winner takes almost all. The-Winner-Take-All effect happens isn’t because winners are better, smarter, and stronger than everyone else. In fact, most of us started at about the same place. But that tiny little advantage can take a person a long way by compounding effect o...

Don’t be discouraged even you are being left behind, as long as you are making a progress, you are already making a difference.

It is hard to accept the truth that there are inequalities everywhere. But depending on how you see it, the rule could help us filter out unnecessary data, better channel our resources, and make better decision in work and life.

The Pareto Principle could also be observed in almost every industry:

  • In software, 80% of the errors and crashes in a system would be eliminated by fixing the top 20% of the most reported bugs.
  • In sports, 20% of athletes participate in 80% of the big games

  • Pick one goal for your business to improve focus and decision-making.
  • Optimise the first item in a funnel that has cascading effect to the entire funnel
  • Work hard to understand the 20% of your customer.
  • Create high margin products that brin...

Phase I: Self-analysis
Reflect
on where your current focuses are. How do these impact you in different areas in life?

Phase II: Identify the 20 Percent
Link
those good or bad results to the source of your activities.

Phase III: Focus on the Fat Tail
Elimina...

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A dream is the root of all success, for having a dream does not limit you on what you can do. Successful people allow themselves to lean back and imagine the kind of life that is possible for them.

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Not having clear goals makes it hard to focus well on your priorities at hand. Applying the 80/20 rule will lift that mental clutter and enable you to focus better on your priorities. By merely identifying that this task is a priority, you’ll start to approach it with more impact and intensity...

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the 80/20 rule- how can it change your life

The 80-20 rule, that 80% of an outcome generally came from only 20% of its inputs.

Take advantage of this knowledge and find out what that activities are a part of that 20 percent.

For example, say you're an agency owner looking for clients. You spend 30 minutes a day emailing potent...

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