The Pareto Principle, better known as the 80/20 Rule, stems from the Italian economist, Vilfredo Pareto back in 1906.
The idea behind his principle is that for many events and actions, roughly 80 percent of the results come from 20 percent of the efforts.
What does that look like in the business world?
- 20 percent of your activities will account for 80 percent of your results.
- 20 percent of your clients will account for 80 percent of your sales.
- 20 percent of your tasks will account for 80 percent of the value of what you do.
Embrace the 20/80 Rule and plan to use it to your benefit to manage your time wisely.
Each of us have many demands on our time, often making it difficult to enjoy a work/life balance.
I believe that we can use the Pareto Principle to help us decide where we should focus our time, energy and effort so we can maximize our results and minimize wasted time.
Begin by asking yourself the following questions:
- Which 20 percent of sources are causing 80 percent of my problems and unhappiness?
- Which 20 percent of sources are resulting in 80 percent of my desired outcomes and happiness?
Let’s begin with question No. 1. Although a certain degree of conflicts and unhappiness is inevitable, life’s too short to live unsatisfied day after day.
It’s time to look for the sources of trouble and begin creating solutions. Look for:
Problems that arise on a regular basis. If it keeps coming up, fix it.
Morale issues. An unhappy team is an unproductive team. Get to the bottom of negative morale issues.
Difficult customers or clients. Determine if you can find a way to make customers happy or if it’s time to cut ties. Not every customer or client is a good fit for our business.
Poor service from vendors. You have a right to spend your money where your business is valued and appreciated, period.
Now, let’s take a look at question No. 2. Where are your positive experiences and sources of happiness coming from? Look for:
Satisfied customers. Be sure to keep in touch and show your appreciation for your top customers. Chances are good that happy customers are singing your praises, engaging in repeat business and sending new clients your way. They are worth their weight in gold.
Work that you love. You will feel fulfilled if you can focus on the work that you are passionate about and that comes easily to you. Find ways to delegate the rest to someone else who enjoys the tasks that you don’t.
Productive teams. If you are working with amazing people that make work and life better, be sure to build on that. Give people positive feedback to encourage more of the same behavior.
Take time to analyze why things are working so well so you can keep the momentum going.
If we get 80 percent of our results from 20 percent of our efforts, there may be a lot of fluff activities that we can cut out of our days or leave for the end of the day.
That’s good news.
Look for activities that are closest to your revenue line to complete first. Be sure to begin each day by focusing on the 20 percent of actions and activities that will help you increase your business and improve your bottom line.
This may require calling customers, kicking off a marketing campaign or creating a new product.
If that’s all that you have time to get done that day, then consider it a successful day.
Monika Kristofferson is a professional organizer, productivity consultant and trainer who owns Efficient Organization in Lake Stevens. Reach her at 425-220-8905 or www.EfficientOrganizationNW.com.