In 1896 Vilfredo Pareto, an Italian economist at the University of Lausanne noted a peculiarity.
He discovered that 80% of the land in Italy was owned by just 20% of the population. Furthermore, 20% of the peapods in his garden produced 80% of the peas!
He was onto something here, he thought. And so did management consultant Joseph M. Juran, who named the principle after the man who first noted it, the Pareto Principle, although it is known by many names - the 80/20 rule, the principle of factor sparsity, or, my personal favorite, the law of the vital few.
The 80/20 relationship seems to pop up all over the place.
Twenty percent of the population controls eighty percent of the wealth. Twenty percent of the customers account for eighty percent of the profit. And twenty percent of patients seem to use eighty percent of the health care resources. It does seem that the vital few are out there making themselves known.
Simply stated, the Pareto Principle states that “eighty percent of the output or results will come from twenty percent of the input or action.”
So we seem to be wasting our time on a lot of useless actions when we could benefit by concentrating on a targeted group of activities which could benefit us all the more.
Take a look at your closet. Applying the Pareto Principle, you probably wear twenty percent of your wardrobe eighty percent of the time.
How much money can you save by extrapolating your tastes and needs, and applying the result to future purchases?
And if only twenty percent of your exercise program is providing eighty percent of the benefits, why waste time on that Stairmaster?
Take a look at all the apps on your phone. Odds are that there are a few favorites, say twenty percent, that you use eighty percent of the time. Why clutter up your life with the others?
It’s also probable that you spend only twenty percent of your free time doing things that give you eighty percent of the pleasure in your life, so why waste time on things you don’t enjoy?
And when it comes to working, you are more likely to devote eighty percent of your time to things which benefit you, and your company, the least.
Reverse those numbers. Concentrate on spending your time productively.
By applying the 80/20 rule to your life, you will be able to concentrate on those things you enjoy, things which can make you more productive, even more healthy.
The 80/20 rule may be easy to grasp, but hard to apply, however.
Sometimes it’s hard to part with things we have been accustomed to doing, but if those things, be they possessions, activities, or even people, are not bringing you joy, it may be time to replace them with things that do.
What could be wiser than finding the things which benefit our lives, and concentrating on them, rather than on others which simply clutter our existence without providing significant benefits?
Instead of spending eighty percent of our efforts to provide twenty percent benefit, wouldn’t it be better to spend twenty percent effort on an eighty percent return?
They’re the kind of figures that make sense.