Know The Pareto’s Rule of 80/20 In A Simpler Way!
[IMG]http://www.newpaceconsulting.com/storage/content/80-20.png?__SQUARESPACE_CACHEVERSION=1310637919615[/IMG]
The universe is unstable and its equilibrium is an illusion. So also it is our life in this planet, wherein only few things are really important to us while most are not.
The above statement was proved by Vilfredo Pareto, an Italian economist by his discovery of his 80/20 principle in 1897 which is referred as Pareto’s Rule in the modern times.
The basics of the Pereto’s rule as discovered by Pareto are:
80% of the output results from 20% of the input,
80% of the consequences flow from 20% of causes and
80% of results come from 20% of effort.
The list is endless.
[IMG]http://www.effective-time-management-strategies.com/images/pareto_principle.gif[/IMG]
Pareto’s rule can still be simplified by referring the 20% as the ‘Vital Few’ and the 80% as the ‘Trivial Many’.
MORAL:
The easiest way to success is to ignore the ‘trivial many ‘and focus on the ‘vital few’.
Reallocate the resources from the unproductive ‘trivial’ many’ to productive ‘vital few’.
Concentrate on the 20% and 80% of everything in your life will be taken care of.
From India, Madras
456[IMG]http://www.newpaceconsulting.com/storage/content/80-20.png?__SQUARESPACE_CACHEVERSION=1310637919615[/IMG]
The universe is unstable and its equilibrium is an illusion. So also it is our life in this planet, wherein only few things are really important to us while most are not.
The above statement was proved by Vilfredo Pareto, an Italian economist by his discovery of his 80/20 principle in 1897 which is referred as Pareto’s Rule in the modern times.
The basics of the Pereto’s rule as discovered by Pareto are:
80% of the output results from 20% of the input,
80% of the consequences flow from 20% of causes and
80% of results come from 20% of effort.
The list is endless.
[IMG]http://www.effective-time-management-strategies.com/images/pareto_principle.gif[/IMG]
Pareto’s rule can still be simplified by referring the 20% as the ‘Vital Few’ and the 80% as the ‘Trivial Many’.
MORAL:
The easiest way to success is to ignore the ‘trivial many ‘and focus on the ‘vital few’.
Reallocate the resources from the unproductive ‘trivial’ many’ to productive ‘vital few’.
Concentrate on the 20% and 80% of everything in your life will be taken care of.
From India, Madras
Thank you for agreeing with my observation. I have posted messages where I have highlighted the importance of 4 magic words: please, kindly, thank you and sorry. However, Here is an appeal to all members.
We all should follow the CiteHR guidelines at the bottom of this message. If we all stopped posting just "Thank you" messages and thanking those that thank us, without adding any value to the thread, we will be able to shift from 80:20 or 20:80 rule to may be 30:70 or even better.
From United Kingdom
We all should follow the CiteHR guidelines at the bottom of this message. If we all stopped posting just "Thank you" messages and thanking those that thank us, without adding any value to the thread, we will be able to shift from 80:20 or 20:80 rule to may be 30:70 or even better.
From United Kingdom
Pareto’s principle is very simple to the point and conveys meaning useful for every one.
From India, Mumbai
From India, Mumbai
Dear AVSjai,
It's good that some such discussions are being focused. Thanks for the posting.
I wish to discuss little more on the concept with present day status. In other words, Of course there were days people were exploited by minority few whereas in the current situation 80 : 20 has really undergone changes as one cannot pointedly figure out exactly the equation. I do agree majority are exploited by minority. This will remain so for many more decades if not centuries in Indian scenario as no revolution is in the horizon. This equation should undergo changes when we compare with GDP which has got direct relation with any country's productivity which in turn reveals the true equation. It could be either 30 : 70 or 40 : 60 and so on as everybody now a days are expected to contribute in a stiff competitive economy.
I think it would be more appropriate if we consider little more like this:
Pareto Principle -- How to Apply It, and What to Avoid.
" Why It’s Important to Be Careful:
A more recent application or implementation of management theory that’s been making the rounds for a few years (both in books and lectures/seminars) suggests that we interpret Pareto's Principle in ways that would create a new approach, sometimes termed Superstar Management. Its supporters claim that since 20 percent of your employees likely produce 80 percent of your results you should focus your limited time in management of only that 20 percent – the so-called superstars. However, this proposed implementation of Pareto’s Principle to management is flawed, because it overlooks the fact that 80 percent of your time should be spent doing what is really important, or most likely to deliver the greatest return. By helping your “good” salespeople become better, you are more likely to reap greater results than by dedicating the same management effort to helping the fewer “great” salespeople become terrific. In this case, the sheer numbers work against you spending time only helping manage and improve the few great workers. Thus, it’s wise to evaluate various management situations and apply the Pareto Principle appropriately – and wisely.
Managing Smart, Working Smart….On the Right Things
At IBM I learned many lessons in management – one being that it’s not only important to do things right, but also to ensure you’re doing the right things. Pareto's Principle should serve as a reminder to us to stay focused on investing 80 percent of our time and energy on the 20 percent of work that’s really important. It’s not just important to “work hard” and “work smart”, but also to work smart on the right things." ......at right time.
Pareto Principle
Six Rules for Great IT Project Success:
Project delivery makes IT organisations credible. When IT "gets it right" at the project level, its ability to impact the financial results of a company increases and its leadership in providing strategic direction improves. Good project delivery is the key to unlocking the door from the back-office to the boardroom. And yet, according to a recent survey by Accenture, only 29% of IT projects are considered successful. The average cost overrun is 56%; the typical delay is 84%. After decades spent learning and implementing project management methodologies, measurements and controls, the success rate of IT projects is no better than when a single computer took up an entire room.
The Non-Pareto Principle
The "Pareto principle" has by this time become deeply rooted in our industrial literature. It is a shorthand name for the phenomenon that in any population which contributes to a common effect, a relative few of the contributors account for the bulk of the effect. Years ago I gave the name "Pareto" to this principle of the "vital few and trivial many." On subsequent challenge, I was forced to confess that I had mistakenly applied the wrong name to the principle. This confession changed nothing - the name "Pareto principle" has continued in force, and seems destined to become a permanent label for the phenomenon.
kumar.s.
From India, Bangalore
It's good that some such discussions are being focused. Thanks for the posting.
I wish to discuss little more on the concept with present day status. In other words, Of course there were days people were exploited by minority few whereas in the current situation 80 : 20 has really undergone changes as one cannot pointedly figure out exactly the equation. I do agree majority are exploited by minority. This will remain so for many more decades if not centuries in Indian scenario as no revolution is in the horizon. This equation should undergo changes when we compare with GDP which has got direct relation with any country's productivity which in turn reveals the true equation. It could be either 30 : 70 or 40 : 60 and so on as everybody now a days are expected to contribute in a stiff competitive economy.
I think it would be more appropriate if we consider little more like this:
Pareto Principle -- How to Apply It, and What to Avoid.
" Why It’s Important to Be Careful:
A more recent application or implementation of management theory that’s been making the rounds for a few years (both in books and lectures/seminars) suggests that we interpret Pareto's Principle in ways that would create a new approach, sometimes termed Superstar Management. Its supporters claim that since 20 percent of your employees likely produce 80 percent of your results you should focus your limited time in management of only that 20 percent – the so-called superstars. However, this proposed implementation of Pareto’s Principle to management is flawed, because it overlooks the fact that 80 percent of your time should be spent doing what is really important, or most likely to deliver the greatest return. By helping your “good” salespeople become better, you are more likely to reap greater results than by dedicating the same management effort to helping the fewer “great” salespeople become terrific. In this case, the sheer numbers work against you spending time only helping manage and improve the few great workers. Thus, it’s wise to evaluate various management situations and apply the Pareto Principle appropriately – and wisely.
Managing Smart, Working Smart….On the Right Things
At IBM I learned many lessons in management – one being that it’s not only important to do things right, but also to ensure you’re doing the right things. Pareto's Principle should serve as a reminder to us to stay focused on investing 80 percent of our time and energy on the 20 percent of work that’s really important. It’s not just important to “work hard” and “work smart”, but also to work smart on the right things." ......at right time.
Pareto Principle
Six Rules for Great IT Project Success:
Project delivery makes IT organisations credible. When IT "gets it right" at the project level, its ability to impact the financial results of a company increases and its leadership in providing strategic direction improves. Good project delivery is the key to unlocking the door from the back-office to the boardroom. And yet, according to a recent survey by Accenture, only 29% of IT projects are considered successful. The average cost overrun is 56%; the typical delay is 84%. After decades spent learning and implementing project management methodologies, measurements and controls, the success rate of IT projects is no better than when a single computer took up an entire room.
The Non-Pareto Principle
The "Pareto principle" has by this time become deeply rooted in our industrial literature. It is a shorthand name for the phenomenon that in any population which contributes to a common effect, a relative few of the contributors account for the bulk of the effect. Years ago I gave the name "Pareto" to this principle of the "vital few and trivial many." On subsequent challenge, I was forced to confess that I had mistakenly applied the wrong name to the principle. This confession changed nothing - the name "Pareto principle" has continued in force, and seems destined to become a permanent label for the phenomenon.
kumar.s.
From India, Bangalore
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