In 1906, Italian economist Vilfredo Pareto created a mathematical formula to describe the unequal distribution of wealth in his country, observing that twenty percent of the people owned eighty percent of the wealth. In the late 1940s, Dr. Joseph M. Juran inaccurately attributed the 80/20 Rule to Pareto, calling it Pareto’s Principle. While it may be misnamed, Pareto’s Principle or Pareto’s Law as it is sometimes called, can be a very effective tool to help you manage effectively.
So what does the 80/20 Rule Actually mean?
The 80/20 Rule means that in anything a few (20 percent) are vital and many(80 percent) are trivial. In Pareto’s case it meant 20 percent of the people owned 80 percent of the wealth. 20 percent of the defects cause 80 percent of the problems. Project Managers know that 20 percent of the work (the first 10 percent and the last 10 percent) consume 80 percent of your time and resources. You can apply the 80/20 Rule to almost anything, from the science of management to the physical world.
the 20% of activities that account for most of the values in your work are invariably the most difficult and challenging tasks. The 80% of activities that only account for 20% of your results are usually fun and easy. Being human, you have a natural tendency to do the easy things, even though they are not particularly valuable or important. To get the most done, and the greatest results from every minute invested, you must resist the temptation to clear up small things first. You must discipline yourself to keep your energies focused on the one or two things that you can do that are more important and valuable than anything else.
The value of the Pareto Principle for a manager is that it reminds you to focus on the 20 percent that matters. Of the things you do during your day, only 20 percent really matter. Those 20 percent produce 80 percent of your results. Identify and focus on those things. When the fire drills of the day begin to sap your time, remind yourself of the 20 percent you need to focus on. If something in the schedule has to slip, if something isn’t going to get done, make sure it’s not part of that 20 percent.
This principle should serve as a daily reminder to focus 80 percent of your time and energy on the 20 percent of you work that is really important. Don’t just “work smart”, work smart on the right things.
Remember, Manage your time effectively and You get BETTER and BIGGER RESULTS!
As you know, I am doing “FREE Mentoring” for a group of people who are dedicated for their Passion. If you think you have the Passion, sign up for my next “FREE Mentoring Session” —> REGISTER HERE! <—
If you have a Passion for your business…
I have a Passion for helping YOU Succeed!
Also check out my Concept to Cash Website
Give me 90 days and we’ll turn your Concept into Cash! http://www.concepttocashin90days.com/
Historical Content from: http://management.about.com/cs/generalmanagement/a/Pareto081202.htm