The 80/20 rule sounds like a statistic and in some ways it
is. Personally I’m not a big fan of math’s; beyond basic statistics like page
views, follower, unique visitors and when I stretch myself I can go as far as
basic book keeping and budgeting otherwise I try and avoid all complex numbers.
I work better with feelings, ideas and concepts.
The good thing about the 80/20 rule is that you don’t have to
understand statistics to be a believer. Yes, it has foundations in economics
and yes, it was “proven” using statistical analysis by a man named Pareto, but
it is not meant to be understood only by economics professors.
In a nutshell, the Pareto Principle says that 80 percent of
your results will be caused by 20 percent of your efforts. So 80 percent of
your income will come from 20 percent of your clients and 80 percent of your
sales will come from 20 percent of your prospects. The trick, as you might have
guessed, is identifying the 20 percent that will produce 80 percent of your
results.
You can definitely apply the 80/20 Rule to most aspects of
your business or working life, however I believe your overall happiness and
satisfaction are much better variables to focus on. Money certainly plays an
important role in your happiness and your money is influenced by 80/20
relationships, but it is only a component that leads to your overall wellbeing,
which should be your primary concern.
You’re surely faced with the constant challenge of limited
resources. It’s not just your time you need to maximize, but your entire
team’s. Instead of trying to do the impossible, a Pareto approach is to truly
understand which projects are most important. What are the most important goals
of your organization, or boss, and which specific tasks do you need to focus on
to align with those goals. Delegate or drop the rest.
It’s important to identify your best (and highest-paying)
clients. Of course, you don’t want all your eggs in one basket. But too much
diversification will quickly lead to burnout. Focus on the money makers and
strengthening those long-term relationships.
The temptation always exists to try the new and exciting.
There’s nothing inherently wrong with that, but it boils down to your goals.
Are you trying to grow your current business? Would an 80/20 mindset help you
to stay focused on your strategic plan and spend less time chasing endless new
opportunities?
No matter what your situation, it’s important to remember
that there are only so many minutes in an hour, hours in a day, and days in a
week. Pareto can help you to see this is a good thing; otherwise, you’d be a
slave to a never-ending list of things to do.
So, what 20% of your work drives 80% of your outcomes?
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