The 80/20 Principle – Knowing Where to Put Your Effort In
This is part two of a three part series on creating success
Part 1 – The Numbers Game
Part 2 (You are here) – The 80/20 Principle
Part 3 – The Art of Failing Fast
Going big is often the best way to ensure your success – create enough output, take enough chances and eventually you’ll be sure to have a hit or ten under your belt which for many of us will be more than enough.
But while working hard enough is often the secret to almost guaranteed success, you mustn’t also underestimate the power of working smart.
What it Means to Work Smart
What it means to work smart is basically to be strategic in the way that you approach any problem or any ambition. In turn, this means approaching your aims in such a way that you will be able to cut corners and accomplish the most with the minimal effort. In theory, this will then allow you to combine your smart strategy with huge output in order to accomplish the best possible results. Putting in 10,000 hours is a great way to become an expert – but the quality of those 10,000 hours also makes a big difference.
The 80/20 Rule
The 80/20 rule, also sometimes know as the ‘Pareto Principle’, basically states that whatever it is that you do, 20% of your effort will yield 80% of your success. So if you sell 100 products, chances are that 20 of them (or even fewer) will make up the vast majority of your cash.
The moral of this story is that if you ‘throw enough paint at the wall’ some is bound to stick. We often won’t know what is going to be the most important aspect of our strategy but once we do, it’s then a good idea to focus on that smaller percentage that yields results.
In the case of a business providing a service, it will often be that the company makes the vast majority of its money from just a few clients while the others serve as nothing but a distraction really. In other cases, it might be that a small number of clients cause the vast majority of the problems.
In such a case, it would be wise for that business to lose the 20% causing the 80% of the problem and even to get rid of some of those clients that aren’t bringing much to the table. Instead, focus purely on the ones that are generating the most income and actually life will be easier and you’ll earn much more. Then you can put in huge effort and see huge rewards for both them and you!