The 80/20 principle can be applied to every area of life. In this video, you will learn how to use the 80/20 principle to be more productive. Subscribe to our channel now to learn how to start and grow a sustainable business.
It means that ultimately 20% of our inputs produce 80% of the output. This is also known as the Pareto principle, named after the man who first made the observation, Vilfredo Pareto.
As business and career-minded people, our understanding of the Pareto principle should best be applied in management. The 80/20 principle should allow us to see how we manage ourselves, time, money, efforts, creativity and relationships. It should enable us to see which 20% of our activities produce 80% of our results. It is to bring to our attention time and other resources that we can’t afford to jeopardise, which have more far-reaching effects on our results.
In the video, we looked at applying the 80/20 principle to different areas of business and life.
Different Applications Of The 80/20 Rule
On Revenue
80% of your margins will come from 20% of your products and services. All your products don’t deliver the same margins. Why then are you giving them equal attention?
On Customers
Not all customers are equal. Therefore, you need to group your customers based on the volumes of business you get from them.
On Marketing
20% of your marketing budget and efforts brings in 80% of the business. When new customers do business with you, always ask them how they heard about you. This lets you know which of your marketing efforts work the most and intensify and give more attention to.
On Performance
20% of your efforts will account for 80% of how you will be appraised. The 20% could be sending a particular report on time every time or managing a specific group of customers very well. It could also be making your boss look good at all times. Identify these activities and do them diligently.
With Colleagues
20% of the relationships you cultivate at work can influence your career growth 80% of the time. Of course, not all your work colleagues can help you beyond discussing weekend events on Monday mornings. But there are others that mentor, challenge, support, and help out with the job. Those are the people you should spend 80% of your time with.
On Creativity
20% of your creative ideas will yield 80% of your results. So when it comes to creativity, get as many ideas as possible. You can’t be too sure which will give the result you want.
On Friends
20% of your friends add 80% of value to your life. Show me your friends, and I will tell you your future. It would be best to do away with friends that drain your resources (time and money especially) without giving anything back to you.
On Money
20% of your needs gulp 80% of your money. So look critically at your expenses and see which of them you can cut off, even if it translates to slight adjustments to your lifestyle.
On Goal-setting
What would it be if you were to accomplish one particular goal that will make all the difference in your life? First, make a list of 10 things that you would like to accomplish, and out of the 10, choose the most important two. Your guiding principle in choosing the goal should be: which one goal will make the most impact in your life?
Before you begin a task, always ask yourself, is this task in the top 20% of my activities or the bottom 80%?
Why are you watching this video about the 80/20 principle? What should you get out of this?
The focal point of the 80/20 principle mindset is its usefulness. It is being aware and taking control of the time and other resources that control our outcomes. It is also a corrective measure to line our ducks in a row when they seem out of line. So, it becomes less of trying harder and more of working smarter.
The most successful and creative people understand that 20% produces 80% and constantly plays to 20%. So if you found this video insightful, subscribe to our channel and share this content. Thank you.
