The 80/20 Rule Mindset

The purpose of this post is to recommend the adoption of the 80/20 Rule mindset to improve your ability to accomplish the results you seek.

According to the Investment Dictionary, the “80/20 rule”, also referred to as the “Pareto rule”, is a principle named after economist Vilfredo Pareto that specifies an unequal relationship between inputs and outputs. The principle states that, for many phenomena, 20% of invested input is responsible for 80% of the results obtained. Put another way, 80% of consequences stem from 20% of the causes.

Many of us spend too much time and effort on people and/or things that have little or nothing to do with the results we need or want to accomplish.   Thus, the time and effort required to accomplish your desired outcome is a lot more than it should be.  In this post, I suggest an approach to change the way you think in order to become more effective in your endeavors.

The process requires a careful assessment of your goals and responsibilities and of all the factors that influence their successful accomplishment.  Here are a few high-level “statistics” based on this rule that are helpful to keep in mind:

• 80% of revenues come from 20% of customers
• 80% of revenues come from 20% of products or services
• 80% of costs come from 20% of expense items
• 80% of time is spent on 20% of problems
• 80% of problems come from 20% of sources/causes

With these “rules of thumb” in mind, think about your own personal situation and whether or not you are spending your precious time and effort on the people and things that matter most and have the biggest impact on your goals and responsibilities.

This simple yet powerful concept can make a big difference on what you are doing and the results you accomplish.  Make sure you know who and what have the most impact on your results and spend your time and effort on those people and actions.  You will see!!!

The BEST is Yet to Come!

Epi Torres, CEO