Introduced by Vilfredo Pareto, the Pareto Principle has lately gained popularity worldwide in the field of business. He discovered that all economic activity was based on the Pareto Principle. This principle gave birth to the new concept of personal time management.
The well-known economist put forth the theory that 80 percent of all the problems that people face results from 20 percent of causes. The term “Pareto 80- 20 rule” has proved to be very beneficial when applied to problem-solving of any form. Identification of “vital few” and “trivial many” with the 80/20 Pareto Principle has paved the way for the desired results. It has provided the idea of yielding 80 percent by accelerating 20 percent of high-value activities.
It implies that 20 percent of the activities will account for 80 percent of the results, and 20 percent of the customers will account for 80 percent of the sales. In addition to this, we can also say that 20 percent of the products or services will account for 80 percent of the total profits.
In day to day life, a person effectively uses only a few hours. Thus, Pareto Principle guides to increase work efficiency and the right usage of time.
Discovered more than 100 years ago, the Pareto Principle has helped shape the modern world when caught in the hands of the innovative thinkers. It has become a valuable tool for making and maintaining business structures. The success of IBM, the industrial revolution of Japan and the immense wealth of Warren Buffet are a few examples. The ‘80/20 analysis’ and ‘80/20 thinking’ together can benefit professional as well as a personal domain by bringing out more output with less effort. By eliminating time-consuming low-value activities enhances the skill and presents 80 percent of the rewards with just 20 percent of time enforced.
Let’s explore the 80/20 path to be richer with time and get more productive:
An essential step
For effective utilization of time, the Pareto Principle is very useful. It guides a person to identify the repeated patterns in his daily schedule hampering his productivity. Once he is aware of the right use of the Pareto Principle, he can make necessary changes in his daily routine. The Pareto Principle prompts an individual to start his day in a better way and helps to identify the possible time takers along with the ones slowing down the process.
Pareto Principle helps in bringing about the right solutions in an individual’s life. A person can increase his personal productivity up to 80 percent if he is able to fix 20 percent of his problems. If a person judiciously uses his time, he can work better, faster and stay inspired for longer. Pareto Principle guides a person to utilise his time in a productive manner and authenticates the use of 15-minute blocks of time to add value to the specified tasks.
Here is how one can benefit from the Pareto Principle:
- Helps to prioritise work
Pareto principle streamlines the work and guides in prioritising the tasks to be completed. It, thus, becomes a smooth sail for a person to have clarity and hold the right approach towards his work.
- Assists in achieving the desired results
Pareto principle is goal-oriented. Following this principle, one can easily accomplish complex and difficult tasks easily. It has a motivation factor of reward and punishment wherein a person strives hard and increases his efficiency towards his work above 80 per cent. Hence, the Pareto principle is a guiding force for task achievement.
- Keeps up the motivation
It is tough, to begin with, a task in the first instance, but the toughest part is to keep going even after losing the initial drive. Pareto Principle helps in boosting one’s motivation for the completion of the work. The human brain loves to remain busy working on significant tasks that make a difference, and one’s job is to feed this part of the brain continuously. Pareto Principle helps one to remain motivated.
- Initiate action
Pareto Principle helps in jotting down one’s daily goals. It disciplines the mind to start with the most important task and helps differentiate the important ones from the non-important ones. Accordingly, it enables the brain to schedule tasks.
- Create ranking
Pareto Principle helps to divide the amount of effort as per the value of the potential results and helps get a priority ranking. For example:
- Task 1: Write a report on a business meeting
- Effort = 10, Result = 2, Priority = 5
- Task 2: Prepare a presentation for the business meeting
- Effort = 4, Result = 4, Priority = 1
- Task 3: Call business clients for referral
- Effort = 1, Result = 10 , Priority= 0.1
Analysing the above data and dividing the time available becomes easy with the Pareto Principle in place.
Hence we can see that the Pareto Principle of 80/20 rule is one of the most helpful concepts for not only time management but all the aspects of one’s life. Irrespective of the number of tasks one has to undertake each day, there will always be a handful that will contribute to achieving extraordinary results. All we have to do is employ the right tact and identify those activities instead of focusing on the time-wasters.