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Hello my dear readers. I don’t know about you, but I used to complain a lot about how the efficiency may not match the effort expended. After all, it also happens with you: you work, you work, but the effect … Let it not be zero, but 20-25 percent of the expected. And vice versa: sometimes it seems that you didn’t really try, didn’t strain, and the result exceeds all expectations. But I’m not one of those people who are used to blaming everything on chance. The search for regularities between efforts and their results allowed me to make my personal discovery: the Pareto law explains everything 20 80 .
The essence of the Pareto 20/80 method
The Pareto rule is empirical in nature: it is based only on experimental data and is not supplemented by theoretical conclusions. And it sounds like this:
“20% of the efforts give 80% of the result, and the remaining 80% of the efforts give only 20% of the result.”
Even more simply, this rule looks like this: if we bet on the right actions, then we win a maximum or so (80%) of the expected result.
This simple principle explains why 90% of the money and material wealth of the planet is in the hands of only 10% of the population (it can be assumed that the remaining 10% simply do not advertise their wealth). Mentally compare the wealth of your friends: is it not so?
Keeping this simple pattern in mind, you can take a different look at your life and work. The conclusion is this: the bulk of the efforts do not produce the desired results. Which means it’s a waste of time. Therefore, for the real achievement of the life goals set for oneself, it is necessary to omit such additional, auxiliary matters. In fact, they do not help, but only delay the expected result, taking up precious time and effort. The result — an increase in efficiency at times!
Briefly about the history of the discovery
Vilfredo Pareto was an Italian economist and sociologist who lived at the turn of the XNUMXth and XNUMXth centuries. Being engaged in scientific research in the field of macroeconomics, he wondered how in different states the distribution of wealth between different segments of the population occurs.
Comparing data on European states, he came to a surprising conclusion: 20% of the population owns 80% of the wealth in the country. And this pattern remains unchanged not only in different countries, but also in different historical eras, the data on which were available to the Italian sociologist.
This discovery probably had some success in the narrow circles of Pareto’s scientific colleagues. And that would have been all, if not for the researcher Joseph Juran, the American «quality control guru.» In the middle of the 20th century, he read a book by an Italian sociologist and interpreted the 80/XNUMX method he described — «the principle of the few that matter» — as a universal balance of efforts and results.
Today, this law is applied in various fields of activity: economics, trade, management, political science, programming, education, interpersonal communication, etc. You may be surprised, but many successful entrepreneurs, scientists, stars know about the Pareto principle. And they not only know, but also actively use it in building their careers and businesses.
Key takeaways from the “imbalance principle”
Knowing the 20/80 pattern provides great opportunities for those who are tired of knocking on a closed door. The main thing is to draw the right conclusions from this statement. Of course, you can practice building logical chains on your own. But just in case, I’ll tell you the main conclusions (this will be just in the key of our topic):
- most of our daily efforts have little effect and simply waste our precious time;
- important factors that really determine success are single, trivial ones are numerous;
- our vision of reality is often far from objective, therefore it is important to take into account the nuances;
- the effectiveness of the idea must be able to evaluate at the very beginning, and if it is insufficient, consider optimization options;
- whatever efforts we put in will mostly be ineffective.
Considering all your affairs and concerns in this context, you will learn how to manage your time and energy, money and emotions as efficiently as possible. Unless, of course, you are focused on success, and not on simply going with the flow.
How the 20/80 theory works in practice
Examples of how the Pareto theory works in life can be found at every turn. Let’s take the sphere of trade: 20% of customers provide the store with 80% of the revenue, and the remaining 80% — only 20% of the revenue. Or the sphere of the economy: 20% of the working population of the state «supports» 80% of pensioners, the remaining 80% earn (officially) so little that only 20% of pensioners are able to provide financially.
Pareto statistics works not only in areas related to finance, but also in education, science, and culture. So, 20% of gifted students use 80% of school knowledge, the remaining 80% — only 20% of what the school gives them. A familiar picture?
The ratio of 20/80 can just as well be «try on» the circle of our contacts, the home library, items (or labels) located on the desktop, the entire volume of the wardrobe. Not to mention our time or family budget! The numbers remain inexorable: 20% — with maximum benefit, 80% — with little to no use.
How do I use the Pareto Law?
In everything, I try to find those cherished 20% (actions, people, books, etc.) that will provide me with 80% of the result. What does this mean? I don’t waste time learning skills that I can’t apply elsewhere. On the contrary, I know what is best for me, I know my strengths — and I get the most out of them. I do not read texts that have no real practical application — I choose only useful articles and books that make me spiritually richer.
From the same position, I advise you to approach the definition of the main sources of income (with the exception of passive sources: deposits and passive investments), the most productive days of the week and hours of the day, the primary tasks for the day, useful and pleasant acquaintances and all other components of your life.
Try to look at reality in terms of 20/80 proportion. Perhaps this way of thinking will be very difficult for you. Much of what previously seemed so logical and natural will have to be reconsidered and reevaluated. Is every customer important to your company? Is every transaction critical to your business? Think a hundred times before answering. The 50/50 Fallacy is costing us too much!
Conclusion
If you add time management techniques to this system, uuuuuuh, you get an explosive mixture of a very effective system for personal success. Let me remind you that earlier we have already studied the basics of time management. You can read the link: “How to effectively manage your time for a busy person using time management techniques.”
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I sincerely hope that this article has become for you those 20% of information from which you can extract 80% of the benefits. I look forward to your comments and descriptions of personal experience in applying the Pareto law! See you soon on the blog pages!