The New 80/20 Rule

Vilfredo Pareto, the Italian economist, discovered the 80/20 principal in 1897, which is now referred to as Pareto’s rule.

He discovered that 80 % of the output results from 20 % of the inputs; 80 % of the consequences result from 20 % of the causes and 80 % of the result comes from 20 % of efforts.

20 % of the customers contribute to 80 % of growth; 20 % of services account for 80 % of turnover: 20 % of employees account for 80 % of productivity; the opinion of 20 % defines the society: the output of 20 % of the population defines the economy of our country.

This 80/20 rule has acquired a new meaning in today’s business.

Most of the organizations and particularly sales Managers are obsessed with working with under-producers and non-performers to improve their productivity. Regular training are conducted and HR policies are changed every quarter to create a motivating environment.

At the same time, top performers go unattended and their performance is taken for granted. The easiest way to lose your top performers is to ignore them in favor of “trivial many”.

The new 80/20 % thinking is the secret of achieving more with less. Focus on strong performers and make them stronger. Start celebrating exceptional productivity, instead of raising average performance. Go for excellence in a few stars instead, of wanting to have average productivity in many.

Don’t waste efforts on 80 %, which will yield very little in return. Transform your thinking. Revamp your outlook. Allocate your resources from unproductive “trivial many” to productive “few stars”. Your effectiveness will depend on how you manage and control this 20 %.

Focus on 20 % and 80 % of everything in your life will be taken care of.

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