80/20 rule

80/20 thinking

In his book, The 80/20 principle, Richard Koch shows there is two ways to understand and live THE rule: the 80/20 analysis and the 80/20 thinking.

On one hand the 80/20 analysis is a kind of scientific approach, you collect data, analyze them and try to find a 80/20 relationship between two different set of data. This relationship will allow you to make efficient decisions.
On the other hand 80/20 thinking calls for you intuition: no numbers, no calculation. You know things are not fairly distributed, so try to identify the minority that matters and downplay the rest. You don’t care whether it is a 80/20 relationship or a 90/15 or even a 75/25. The point is focus your energy, your time, your skills to get maximum result, work, rewards.

Why is 80/20 thinking important?

You don’t always have data: 80/20 analysis needs data. If you are a sales person and want to examine your work it’s easy to collect data about your customers and sales amount and analyze them but in plenty of other situations you cannot get data easily. For example you want to setup a new habit to get back in shape. In this case it is much more tough to determine how much food, exercise or rising early contribute to your goal.

You don’t always have time to analyze data: The goal of the 80/20 approach is to make smart decisions. Sometimes smart decision means quick decision. In some case you cannot wait a couple of weeks to gather data and spend one hour analyze them deeply. You need to get to the point fast. Using your guts, your logical to define what are the small amount of input that leads to great result.

Make the 80/20 thinking an habit

Think the 80/20 way is not natural. We would like to think the world is balanced and fair but the key is that not all things are equal, some contribute more than others. Not every work hour has the same impact, not every unit of your energy make you reach your goal in the same proportion.

You need to train your mind to identify things that matters.
Here is your assignment for today (and more) : every time you do something, try to figure out if yes or no your action is going to have a big impact. If the answer is no can you avoid it or minimize it?
But be careful several actions cannot be avoided: you have to pay your bills or do your laundry for example…
After some time asking yourself this question you will do it automatically and without thinking about it.

Your feedback

I will be interested to get your feedback about this topic. Are you more 80/20 thinking or 80/20 analysis? And why?
Don’t hesitate to give your opinion also if you just start your journey into the 80/20 principle world ;).

photo credit: khalid almasoud

© 2008 Unbalanced man.