Wednesday, 4 March 2015

Using the Pareto Principle

What is the Pareto Principle, and how can you use it in your own life?

The Pareto Principle is an almost universal principle.  It tells us that 80% is produced by 20%.  Percent of what?  Well, of almost anything.  For example, 80% of the results you get come from only 20% of what you do.  If, therefore, you can find out which 20% is giving you those results you should be able to stop doing the other 80% and only suffer a 20% loss in results.  At this point you may be saying “I don’t want a 20% drop in my results!”  True, but as you have stopped doing the 80%, that means you can devote more resources to something else, which will hopefully bring in more than the 20% you have lost.

You can apply this principle in so many ways.  Once you have grasped the concept it is easy to find many ways you can use it to improve your life.  Achieve far more with far less effort!

For example, you will probably find around 80% of the time and effort you put into something is more or less wasted.  Examine more carefully what it is you are doing and start cutting out what seems to be irrelevant.  It seems obvious, doesn’t it?  But very few people actually do it.  Work on this and you will be amazed at the difference it can make in your life.  It will free up an enormous amount of time, some of which you can re-direct to the more effective activities and some of which can become your “quality time”.  Apply this process properly and you will find you are achieving far more in a lot less time.

If you run a business you can find many more ways to use Pareto.  For example, around 80% of your turnover probably comes from only 20% of your clients.  Focus your efforts far more on those clients and you should find a large increase in turnover.  You can do this without having to spend any more time working – simply take the time from the other 80% of clients who are far less profitable.

Take a look, too, at some of the personal development techniques you use.  What results are you getting from them?  Some will be giving you a great deal of benefit, and some very little at all.  Given the large time lag that is often involved this is probably going to be a more difficult exercise, but it is certainly not an impossible one.  Also, you must be “fair” to each of the techniques – check very carefully that you are applying them properly.  You may be surprised to find that a large number of people do not do this – they study the technique, adapt it so it is “more suitable” for them, and then find it doesn’t work properly.  Make sure you don’t fall into that trap!  The ultimate benefits you will gain from doing this properly will make the effort required very well worthwhile.

Now that you are aware of the 80-20 rule take a good look at your life and try to find all the diverse ways in which you can apply it.  I have given you some examples above, but they are just a few I have thought about which are likely to apply to many of my readers.  There are far more, and every time you find a new way you can apply it you should find it gives you more of what you want out of life.  More time, more money, more improvement – the sky is the limit!

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