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As
my friend Brad was driving to the airport in Louisville this past weekend,
we were discussing the attendance at our fraternity reunion held the previous
two days. Brad
has been the chief organizer of the event for two consecutive times. He pointed
out that he had worked even harder on promoting the weekend event this time than
he had four years ago and saw no increase in attendance at the reunion. " Sounds like the Pareto Principle strikes again",
I offered. We both agreed that the Pareto Principle, also known as the 80/20 Rule,
rang true with our reunion attendance figures. Of the total number of invited
guests for the reunion, only about twenty percent showed up and eighty percent
chose not to make an appearance. Even with an enticing party planned at an excellent
hotel, the ratio held true. The 80/20 Rule applies to many things. Vilfredi Pareto, an Italian economist, created
a formula to describe the unequal distribution of wealth in Italy in 1906. He concluded
that twenty percent of the people owned eighty percent of the wealth. As
time went on, Pareto was given credit for the 80/20 Rule
that others had also noticed for mathematical relationships. The Pareto Principle
has become synonymous over time with the 80/20 Rule. This
principle of 80/20 is true with many relationships. As examples: it has been found
that 20 percent of the roads in your town handle 80 percent of the traffic, 20
percent of the members of a committee do 80 percent of the work and 20 percent
of the automobiles on the road cause 80 percent of the accidents. Some
applications of the 80/20 Rule to business:
- 80% of a manager's interruptions
come from the same 20% of the people
- 80% of sales time is spent
on 20% of the customers
- 80% of your profits come
from 20% of your customers
- 80% of the sales are brought
about by 20% of the sales force
What
does this mean to you? Ask
the question, " Is what I'm about to do on the short list of tasks that create
80 percent of the results I'm looking for?" As you develop the habit of concentrating
on the items that produce the greatest results, you will be moving closer to becoming
a member of the group that controls 80 percent of the wealth. My
clients who have applied this priority thinking in their businesses have gotten
terrific results. Expect to get the best results if you start thinking this way
any time before the age of 80 and after the age of 20, as a rule. | 
