80/20 - Pareto principle

The 80/20 rule is also known as the Pareto principle or the law of the vital few, which basically means that in many events 80% of the effects come from 20% of the causes. The Pareto principle name came from the Italian economist Vilfredo Pareto who discovered the principle after realizing that approximately 80% of the land in Italy was owned by 20% of the population, and he kept observing the same pattern in other different situations.

 The Pareto principle or 80/20 rule is the universal truth about the imbalance of inputs and outputs. You don’t need to create mathematical formulas, do some complex math, or understand statistics to leverage the 80/20 framework and start using it in your daily work. Let’s also keep in mind the 80% and 20% are just indicators. It’s a misconception that the numbers should always be around 80 and 20. They do not necessarily need to, these numbers are just a baseline.

The main point is to find the small things that give you the biggest results. The 80/20 rule is a guide that will help us understand typical distributions not matter what the numbers are. The point isn’t the ratio, it’s the imbalance, the inequality. The Pareto principle is not about working less and producing more, it’s more about working smarter and prioritizing the right things in order to deliver better results and value.

How to set goals based on the 80/20 Rule

1. Identify your key tasks based on your goals. What’s blocking you? Make a list of your constraints. What’s standing in the way of your priorities? Together with your team, come up with a plan to unblock. Take this opportunity to clarify the goals and visions with your cross-functional team. This is also an opportunity to collect feedback.
2. Clarify and unblock. More clarity will help you and your team have a better vision of your goals and what you need to do in order to achieve those goals. Removing impediments opens the door to more focus, keep in mind that we want to maximize the value of focusing on tasks that will give you more return.
3. Use the 80/20 framework. After you have evaluated your goals and tasks using the 80/20 framework, it’s so much easier to focus on the right things. Since you’ll be focusing on what will bring you more value, you’ll start to see the results faster. This can also be another incentive to continue to focus on what matters the most.
4. Work smarter. This should be a constant basis in our daily lives: evaluate, prioritize, focus, and continuously work. Don’t be discouraged, work smarter, and help your team to work towards their goals.

Source: https://medium.com/pm101/how-you-can-apply-the-80-20-rule-in-your-life-and-work-7d094a78e136