The Pareto Principle

Have you ever heard of the 80/20 principle? I first learned about it in graduate school, but occasionally have to revisit it when my life feels like it is spinning out of control.  The rule came from Italian economist, Vilfredo Pareto, who discovered that 80% of the income in Italy was earned by 20% of the Italian population. Since then this rule has been expanded to various aspect of life and found to hold true. 

What this means is that in your life 80% of your outputs come from 20% of your inputs.   To put this another way, 20% of your activities equate to 80% of your productivity.   So how can you use the 80/20 rule to maximize your outputs?  Let’s look at one of my mentors, John Maxwell. He talks about the fact that he is only good at a few things.  Therefore, he doesn’t waste his time with those things he cannot do or does not want to do.  Most of us still have to do things we don’t want to do. The idea is that by focusing on what you are good at – those few things; and not waste time on those things you are not good at, you maximize your efficient self and are able to improve upon and increase your skillset on what you are good at and what you love to do. 

Application to Personal Growth

If you are reading my blog, you are, most likely, interested in personal growth and leadership. What are you interested in learning about?  What areas would you like to increase your expertise?  Malcolm Gladwell speaks of how to become an expert; the common thread is spending 10,000 hours perfecting one’s craft.  If you spread yourself across the board, become a Jack of all trades, master of none, then your efficiency rate decreases and no longer will the 80/20 principle work in your favor. 

Take a moment and consider what you love and what you are really good at and then list out those things that cause you to waste time and decrease your efficient self.  If you are able, hire someone to do those tasks that fall on that list.  Share duties with your children, spouse, roommate, significant other, co-worker, team members, etc.  Trade your time and skillset for theirs.  You will find that focusing on those 20% tasks, the 80% yield will be worthwhile.

Application to Leadership

If you manage a group of people think about how you can apply the Pareto Principle.  This principle holds that roughly 20% of your staff will produce 80% of the results. As a leader try spending 80% of your focus on those top 20% of your staff.  Recognize their work, reward them, and see what other support they need from you.  Spend a little time helping them find 20% of their activities that give them 80% of their results and see what happens. 

I’m not suggesting you ignore the other 80% of your staff.  Think about it, where do you normally focus your efforts? For most leaders they spend 80% of their efforts on the bottom 20%, those “problem employees” who come in late, are less productive, and are generally a pain in the rear end.  Do you really get the most “bang for your buck” by focusing on the bottom 20 percent?

Try shifting your focus onto your top producers for a few weeks and see what happens.  Consider it an experiment.  I think the results might surprise you. 

As always, thanks for reading my blog.  If you know someone who could benefit from my free report, The 7 Mistakes Most Leaders Make, please send them the link.  Soft skills lead to hard results!