Pareto Principle: The Significant 20%
Driving your focus to the right places.
20% of my articles drive 80% of the site’s traffic. It’s likely that 80% of your revenue comes from 20% of your clients.
This is the Pareto Principle, known as the 80/20 rule. Where 80% of results come from 20% of inputs. Understanding which 20% matters can change how you work.
This simple rule can help you tremendously with planning, prioritising, and focusing.
Origin
Italian economist Vilfredo Pareto first observed this pattern in 19th-century Italy: 20% of Italy’s population owned 80% of the land. It isn’t a strict mathematical law but experience-based observation.
Most inputs produce average results, but a few produce disproportionately huge results. The distribution is uneven. This can cause the 80/20 pattern. The exact percentages may vary, but the key insight remains: the minority produces the majority.
In Practice
A framework that can help you gain leverage with this principle:
List all your activities (inputs: articles, sources of income, features shipped, etc.)
Measure their impact on an appropriate scale (outputs: traffic, revenue, issues resolved, etc.)
Find the top 20%
Dig deeper to understand what makes them stand out
Learn how to reproduce them
Example: I listed all Perspectiveship’s articles, and measured new subscriptions from each, to identify the top 20%. Articles with more concrete examples drove more subscriptions, like the one with the Decision log.
Relevant examples:
Businesses: 20% of clients generate 80% of revenue. What makes them different? How can the business target more of those?
Leadership: 20% of your team requires 80% of your time. Can you do something to reduce it? Are they struggling?
Software: Microsoft found that 20% of bugs in their software are responsible for 80% of failures. They refocused on those parts to improve quality. They went even further to determine that 1% of bugs cause 99% of their crash reports.
Summary
Pareto is a good rule to take into consideration when thinking about what to focus on.
The 80/20 rule is simple and, when used wisely, can help you refocus on actions that have much greater impact.
What drives the most impact for you?
What’s in your 20%?
Double down on it to get better results.
Thanks for reading!
– Michał
Post Notes
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