Strangely, this week, I found myself explaining the 80/20 principle to everyone I know…
Though this principle is well-known by leaders, it is rarely applied. Leaders around the globe get flooded with information, sometimes more than they can handle. However, they have to make swift decisions and keep their most important objectives in mind.
To extract value and positivity in every situation, to improve our daily life, our institutions, our efficiency, our processes, our achievements, it is detrimental to understand the 80/20 Principle.
Wondering how to generate goals and focus on the most important ones using the 80/20 Principle?
What Is The 80/20 Principle?
The 80/20 Principle is actually known as the Principle of Imbalance, the Principle of Least Effort or the Pareto Law, uncovered in 1897 by Vilfredo Pareto, an italian economist. In the 19th century, in England, Pareto noticed that 80% of the wealth and income was accumulated by only 20% of the population. Furthermore, Pareto remarked that the wealth was not evenly distributed and that not only wealth was distributed in this manner. The Pareto Principle was consistently reproducible in different countries, in different times and with different sets of data. The Pareto Principle :
- has been justified by Professor Zipf who demonstrated that 70% of marriages happened to people living 30% within each other.
- has been used by Joseph Moses Juran during the industrial revolution, in Japan, in order to improve the quantity, the reliability and the value of customer goods.
- is illustrated in every cause to effect relationship. For example,
- 20% of employees or customers are responsible for 80% of the company profits.
- 20% of criminals commit 80% of the crimes.
- 20% of your clothes in your closet will be worn 80% of the time.
- 80% of our achievements happen in 20% of our time.
According to Richard Koch, author of The 80/20 Principle The secret of achieving more with less, the principle either requires 80/20 Analysis or 80/20 Thinking:
- 80/20 Analysis: Before taking action, Prior analysis of the non linear relationship between cause and effort. This analysis is time-consuming but more detailed.
- 80/20 Thinking: Before taking action, intuitively identify what is most important, then verify the usefulness of the 80/20 principle in the given situation. This is faster.
Why It Will Change Your Life
Generally, the 80/20 is used to prioritize, to set goals, to achieve more in less time and with less effort. It can be applied in business, in life, in any social grouping and in various cultures. For instance, in business, it helps you identify the areas where you lose time, money and where it is possible to cut your losses. To exploit its full potential, the 80/20 principle exerts us to:
- Spot the most important and ignore the massive unimportant.
- Understand that every action doesn’t lead to the same outcome or even lead to one.
- Use and work on strengths rather than weaknesses.
- Seek shortcuts instead of taking long detours.
- Gain more control over our lives and thoughts, our work and career selection.
- Relax, work less and “target a limited number of very valuable goals”.
- Transform your work habits.
- Target a number of valuable goals.
- Develop a healthy business strategy.
- It is always possible to improve your skills.
- Multiply what is effective.
- Apply it in business to reduce costs and to generate more revenue.
Putting The Principle Into Practice To Set Tangible Goals
The 80/20 is for those who want more of their life, for the ambitious, for the goal-oriented and for the self-disciplined. Being ambitious is not synonymous to bein overworked, busy, or sacrificing yourself. To harness the 80/20 Principle, to make your dreams more feasible and to grow exponentially in any field:
- Discover what you are more enthusiastic about in life.
- Avoid investing the same amount of energy in everything that you pursue. Be strategic and identify the best 20% and invest 80% of your effort.
- Most people believe that goals are wishes, mere desires that they don’t believe they can achieve. Get clarity and be specific on what you want. There is no unrealistic goals.
- Make your goals big. The bigger the goal, the bigger the impact on your life, the higher the motivation and the longer you can maintain the vision.
- Make sure that these goals are self-imposed.
- Keep your goals simple. Simple is rare but simple is effective. Choose simplicity first. For example, identify the simplest and most standardized product, nurture the simplest 20%, make it high quality and eliminate the rest. In addition, simple businesses are better than complex ones because they deliver better value and perform better.
- Find ways to make your goals achievements fun. Avoid spending time on easy tasks and tune out distractions. Johann Wolfgang von Goethe said it best: “Things that matter most must never be at the mercy of things that matter least”.
- Avoid focusing on the negative and waiting for a positive outcome. It is necessary to let go of the customers, employees, products and processes that don’t bring profits
- Know your values and purpose. Then, align your goals with your values in order to feel more fulfilled.
- Analyze the reasons and the costs of these goals beforehand. Applying the 80/20 Analysis will indicate whether or not you would pursue them.
- Write down your goals for various parts of your life (career, work processes, leadership styles, lifestyle, health) and accomplish the most important goal. These goals must have value. Writing down goals allows you to solidify them subconsciously and to get everything into place.
- Write down what you really want and write it down as if you are writing it from the future, having already achieved your goal.
- Work on this one goal all the time. 20 Percent of your activities will result in 80 percent of our results. It is a known fact that you shouldn’t put all your eggs in a basket. Instead, choose the basket to put all your eggs into.
- Review these goals on a daily to keep your commitment to yourself.
- Divide your goals into smaller steps to make your plan more coherent and easier to achieve.
- Identify the obstacles, the knowledge needed, the relationships that you have to build to achieve your goals.
- Measure your progress with parameters like money, time, energy, emotional investment. You can even create a deadline. If you miss a deadline, create another one.
- Share your goals with those that will implement it.
Last Words Of Advice!
Don’t beat yourself or your team up for not realizing all your goals. Have you used the 80/20 principle and what have you noticed? What is one of the goal that you want to accomplish? Hope that I’ve helped you get it together on your way to leadership! Don’t forget to like, share and leave a comment below.Subscribe to Journey To Leadership