80-20 Rule : Know Yourself

The biggest factor that stops most people from chasing their dreams and working towards their real goals is fear. Fear of the lack of security, the reduced paycheck and of the unknown future keeps people locked into routines that are not satisfying. That path leads to sadness, depression, poor health, low income and ultimately an early death!

Don’t let fear be the reason for not achieving our goals. Stop, reassess our real passions, and remove the money equation long enough so we can think without worrying about finances and make plans. Maximize what we are good at. Find the activities that produce the most results for us and our business and put our energy where the big rewards are.

Of the things we do during our day, only 20 percent really matter. Those 20 percent produce 80 percent of our results. Identify and focus on those things. 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.

Pareto’s Principle: This is an interesting principle, the principle of 80/20. It asserts that there is an inbuilt imbalance between inputs and outputs, causes and consequences, effort and result. It states that a minority of causes, inputs or effort usually lead to a majority of the result, outputs or rewards. A few things are important; most are not.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. It may look quite strange, but this is applicable to many a things in our daily life.

80/20 Thinking, applied to our daily life, can help us change behavior and to concentrate on the most important 20%. Action resulting from 80/20 thinking should lead us to achieve much more with much less. To engage in 80/20 thinking, we must constantly ask our self: what is the 20% that is leading to 80%?There are many economic conditions, for example the distribution of wealth and resources on planet earth, where a small percentage of the population controls the biggest chunk, which clearly demonstrate the 80/20 Rule.

There are business examples such as 20 percent of employees are responsible for 80 percent of a company’s output or 20 percent of customers are responsible for 80 percent of the revenues, the 80 percent of the decisions come from 20 percent of the meeting time, 80 percent of the customers complain about the 20 percent of the products or sales and 80 percent of the manager headaches come from 20 percent of the same people.At a micro level just by looking at our daily habits we can find plenty of examples where the 80/20 Rule applies. 20 percent of the people we deal with give 80 percent of our happiness. Count on these people and add quality to our life. We probably make most of your phone calls to a very small amount of the people we have numbers for. We likely spend a large chunk of our money on few things (perhaps rent or food). There is a good chance that we spend most of our time with only a few people from the entire pool of people we know.

When we start to analyze and breakdown our life into elements it’s very easy to see 80/20 ratios all over the place. The trick, once our key happiness determinants have been identified, is to make everything work in harmony and avoid wasting time on those 80 percent activities that produce little satisfaction for us.

The message is simple enough - focus on activities that produce the best outcomes for us. This applies to both our business/working life and our “other” life. In truth, and this is a sad fact, most people in the world work jobs they don’t like and only truly live their passions on weekends and outside of working hours. Only a small sample actually lives their passions day in and day out, how they want to and when they want to. So reorganise ourselves, identify those 20, which is deep inside us and get ready to welcome the 80 percent happiness.