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The Pareto Principle

Implementing 80/20

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
Eliminate
or at least, minimize destructive routines and focus your time and energy on the top 20% habits that lead to good progress

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IDEA EXTRACTED FROM:

The Pareto Principle

The Pareto Principle

https://medium.com/the-blog-of-dean-yeong/the-pareto-principle-a3e25b51f73

medium.com

7

Key Ideas

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%). 

80/20 Rule All Around

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
  • In business, 20% of the products bring in 80% of the revenue.

80/20 Rule: Threat or an Opportunity?

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.

Strategies for Keeps

  • 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 bring 80% of all profits.
  • When assessing risk, recognise not all risks are equal.

Why Winners (Almost) Take All

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 over time.

Small Improvement Matters

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

Implementing 80/20

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
Eliminate
or at least, minimize destructive routines and focus your time and energy on the top 20% habits that lead to good progress

SIMILAR ARTICLES & IDEAS:

Applying the 80/20 Rule in Goal Setting

  • Assess your goals. Work on the most valuable all the time.
  • Work on the tasks with the greatest impact.
  • Think like a wealthy person. Do what one does.

Brian Tracy

Brian Tracy

“When your goals are clear, you will come up with exactly the right answer at exactly the right time”

Make Dream a Reality

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.

2 more ideas

Identifying What's Truly Important

20% of your activities will account 80% of the results, and vice versa. Start working on the most important tasks, it may be complex or difficult but it holds majority of the outcome. 

Neglecting 80/20 = Mental Clutter

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.

Do a self-diagnostic

  • Track decisions. Spend a week tracking all the choices you make in a day.
  • Evaluate effectiveness. Review your notes and group decisions by category. T...

Choice minimalism

  • Simplify the wardrobe. We tend to wear the same 10–20% of our wardrobes for 80%+ of the time. 
  • Eat the same few meals
  • Design a morning routine and save your willpower for important decisions later in the day.
  • Shop the periphery. The unhealthy stuff is built into the center, so stay on outskirts: there are fewer options AND it’s healthier.
  • Set “key objectives” before bed to saves time in the morning when you want to jump right into doing focused work.