Time Management > Pareto Principle > What You Need to Know About the 80 20 Rule
What You Need to Know About the 80 20 Rule
The 80 20 principle or the Pareto principle is famous in time management circles. It may be the most influential thing you learn about managing your time...ever!
In simple terms the 80 20 principle states that 80% of the effects are from 20% of the causes. You can look at it this way:
20% of your workers produce 80% of your results
20% of your customers produce 80% of your revenue
20% of your wardrobe you wear 80% of the time
It is important to note that the Pareto principle is not exclusive to business related activities. You can apply the 80/20 rule across nearly all spheres of life.
Why Is The 80 20 Principle Effective?
You can use what you learn from the 80 20 rule to leverage what 20% of a task or activity that you focus on. You can optimize your time to focus on the 20% that brings you the best return on your time.
For example, I run my online business which involves several very different activities to make it run smoothly. It is very easy to get caught up doing "busy work" or the 80% of work that feels like you are doing something but is actually not all that productive. Instead I do regular assessments to make sure that I focus on the 20% of activity that produces the best outcome for my business.
How You Can Utilize the 80 20 Rule
You will see this pattern repeat over and over, once you know to look out for it. A few common ways you can use the the 80 20 principle to manage your time better.
20% of your relationship with someone will be 80% of the value, focus on the 20% that gives the most value.
20% of your workers produce 80% of the results, focus on this 20% of employees to move your business forward.
20% of your customers will be responsible for 80% of your revenue, aim to satisfy these customers to push your profits up.
20% of tools are used 80%% of the time, invest the time to learn to use these tools better.
20% of your 'stuff' is used 80% of the time, pack up or give away unused 'stuff' to create more simplicity.
20% of the features are used 80% of the time, target on improving these features.
20% of the time you spend on something results in 80% of the value, detect which activities fall into what category, work on the productive tasks and eliminate the unproductive and meaningless activities.
The Time Management Lesson
Manage your time wisely, and utilize the leverage that the 80 20 rule gives you. In any scenario work out what things/activities are bringing the best results. Give this smaller percentage most of your attention.
If you run a business and currently earn the most from 20% of your work or clientele try to expand this area of your business as it will yield far greater rewards. If 20 percent of your skills generate 80 percent of the returns, then focus on your strengths!
One thing to note is that it is not always a perfect 80 20 scenario, sometimes the percentages vary a bit and it may be more like 90%/10% or 70%/ 30%. The aim is to utilize the tasks/activities that garner the most reward.
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