The Pareto Principle

Most people believe that to achieve success, one must work tirelessly to the bone, endure pain and a commitment without parallels, go through the hard knocks, and come out a stronger person in the end.

Well, while to experience the above does indeed make you a well rounded and experienced person, what if there are easier routes to achieve your goals? What if you could be more effective in selecting your objectives and destination, and even more efficient when selecting the vital tasks that you know will have the biggest impact in achieving your goals?

This Isn’t Pie-In-The-Sky Thinking!

The 80/20 rule or Pareto Principle came from Vilfredo Pareto, a 19th Century Italian economist, who researched Italian land ownership and found that 80% of the land was owned by 20% of the population. He then turned his attention to other countries and their wealth, and a similar finding resulted.

It turns out that most things in life can follow this rule of thumb. Be it in business, your personal life, problems, or whatever – pretty much everything shares the fact that the majority of something is caused by the vital few.

Let’s have a look at some examples:
• 80% of work is completed by 20% of your team
• 80% of sales come from 20% of your clients
• 80% of your complaints come from 20% of your customers
• 80% of your problems come from 20% causes
• Even 80% of your success comes from 20% of your actions!

Try it…

Now, not all things equate exactly 80/20. It could be 95/5, or 90/10, but you will normally find that the majority of things come from the vital few actions / causes / sources.

The law of focus – Less is more!

In business improvement, most businesses are harboring typically 95% of waste or non value added activities in their day-to-day processes. That’s a lot of areas to focus on and improve profitability and productivity in your business!

Using these principles, you can start to modify things in your favor. What about if you identify the biggest actions that would help you achieve your goals - blocking out the noise of having too many targets? Or if you knew the vital few root causes to a continuing problem?

What if you knew the easiest and most effective route to achieve your life goals?

If you knew you could always get more of the great things that life has to offer, with less effort and cost, would you be interested?

This month, turn your attention to the law of less!

That is, the Pareto Principle. Most people believe that to achieve success, one must work tirelessly to the bone, to endure pain and a commitment without parallels; to go through the hard knocks and come out a stronger person in the end.

If we learn to identify the things that matter most to us and add the greatest value to our lives and the things we believe are the most important, we can discover less is indeed more.

If indeed we know about the Pareto Principle, then we can easily cut the noise out from our problems and highlight the 20% root causes and the 80% impact.

See this and other newsletter articles at http://amt-mep.org/files/5214/2771/1863/2015-04.pdf

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