Why should you care about the 80/20 rule aka Pareto’s Principle? What if you could invest just 20% of your effort or resources and get 80% of your results? What would you do with the time and money you liberated?
Quality guru and management consultant Joseph M. Juran popularized Pareto’s Principle through Juran’s work on quality issues. Juran stated Pareto’s work as “the vital few and the useful many.”
What if you found the 20% of root causes that were causing 80% of your problems? Would you have happier customers? Would you be more profitable? Would you be able to move toward business goals that once seemed aspirational?
Why should you care about the 80/20 rule aka Pareto’s Principle? Simply put, there are only 1440 minutes in a day.
As a small business owner or manager, you need to be able to get the most bang for your time (and money). How can you go wrong with using Pareto’s Principle?
The 80/20 rule is not a magic bullet. Here’s why. How good is your record keeping and business metrics? Do you just have data or are you measuring things that are truly important to your business success? How do you know? For each data set or metric, ask yourself is what I am measuring truly helping me reach my business goals? Remember it is all about leveraging your scarce time and resources for maximum effect.
Learn more about Pareto’s Principle from Wikipedia, Kevin Kruse’s Forbes article about life hacks, and how to use Pareto’s work to grow your business. You can even watch YouTube videos about the Pareto Principle. Here’s one that doesn’t get too geeky.
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