80/20 rule, law of the vital few, principle of factory sparsity…or “Pareto Principle“; they all mean the same thing. Named after Italian economist Vilfredo Pareto, who observed in 1906 that 80% of Italian land was controlled by 20% of the population, it is a modern day business principle which can be applied to many fields. The most common is what we call the 80/20 rule which is that 80% of sales come from 20% of the customers.
Many best selling books suggest to identify your ideal client in that 20% and find more of them. [Ideal client: motivates you, doesn’t beat you up on price, pays their bills and you enjoy working with]. The one paradox that might exist within the Pareto Principle is that no matter how many of those ideal clients you locate that the 80/20 rule should still pertain to your sales mix. You will always be chasing that even distribution and diversification in sales but in theory it should be a loop that continues to bend to the 80/20 rule.
Here are other other ways to apply the Pareto Principle to our lives:
-Prioritize the 20% of the tasks that will produce 80% of the results in your day.
-Go to 20% of the networking events that produce 80% of the business leads.
-Drink half as much of the 20% of liquids that produce 80% of your liquid calorie intake.
-Find more of the 20% of your hobbies that give you 80% of your fun.
-Read more of the 20% of the blogs/books that give you 80% of your reading interest.
-Eat more meals with the 20% of your friends that give you 80% of your positive motivation.
-Avoid the 20% of types of activities which have produced 80% of your injuries.
-Identify and address the 20% of controllable things that produce 80% of your unnecessary stress.
The applications are endless and you can quickly see how even moving forward with a few of these would have a profound influence on our personal and professional lives. How would you use the Pareto Principle?