The 80/20 Life

The 80-20 rule or the Pareto Principle is a well known concept in business circles. The concept dates back to 1896 when the Italian Economist Vilfredo Pareto found that ‘for many events, roughly 80% of the effects come from 20% of causes’. Pareto observed that 80% of the land in Italy was owned by 20% of the population.

There are similar situations even today in economies, in businesses and in our daily lives. Companies find that 80% of profits come from 20% of the customers or 80% of complaints come from 20% of customers or for that matter 80% of grievances come from 20% of employees. Companies derive their operating strategies based on these observed possibilities. Of course, the accuracy of the 80-20 principle is not what is important but the significant asymmetry of efforts and results is the key point.

How do we apply the 80-20 rule to our lives?

A few years back I read a book 'The 80/20 Principle' by Richard Koch. Koch presents the 80/20 principle as getting higher output from the least effort, thinking more ambitiously, wanting to make life better for oneself and others, thinking unconventionally, finding more happiness, believing in progress and growth, investing wisely, doing less and getting more etc., What I liked most was the profound statement 'action drives out thought'. This calls for more reflection, looking at how to revolutionize the concept of time rather than trying to manage time. If 20 percent of time gives us 80 percent output improving the 20 percent time may give huge dividends than trying to manage 100 percent time.

This may appear simple and common sense. However, the fact is that most of us do not realize this in our daily lives. We spend our time on a huge list (those who care to make a ‘to do’ list) of things and fill the entire time available ending the day or night as may be, feeling good about having attempted many things or having spent a lot of time on the tasks or often feeling frustrated as the outcomes did not match up to the time and efforts spent.

At an individual level, most of us do not prioritize our efforts on an 80-20 rule. Most people say that at work, most often the priorities are by and large decided by external factors. However, this is not always true. Companies in some way decide or guide the key result areas, leaving quite a bit of freedom to the individual to apportion his or her time and efforts to achieve this the best way possible. The fact is that only very few people realize this. They tend to go by a linear sequence or based on external demands. Yes, there are jobs that are meant only to attend external queries like an incoming call agent in a customer care centre. But most other jobs leave a lot of freedom to prioritize time and efforts.

The book also talks about doing things we like (hedonistic in a positive sense). When we do more of what we enjoy doing it tends to give high quality output. This applies more to the personal side of our lives rather than the professional side, unless one is in a profession that matches exactly one’s passion.

The 80/20 rule is not much about a technique but more about a new way of thinking. It is about thinking non-linear. It is about a time revolution. When thinking about any potential use of time, ask two questions: 1. Is it unconventional? 2. Does it promise to multiply effectiveness?

‘Things that matter most must never be at the mercy of things that matter least.’- Johann Wolfgang von Goethe