Richard Koch has authored and co-authored 18 books, the best-known of which is his The 80/20 Principle. The 80/20 principle started as an economic theory put forward by Vilfredo Pareto in 1897. Not surprisingly some people still call it the Pareto Principle. It has also been called the Rule of the Vital Few and the Trivial Many, and you will soon see why.
First insight: the universe is wonky, it’s not neatly balanced! There appears to be an inbuilt imbalance between inputs and outputs, causes and consequences, efforts and results. The 80/20 Principle is a neat way of stating this imbalance. For example, in business approximately 20% of your products will usually account for more or less 80% of your total sales and profits; and 20% of your customers will usually account for 80% of your sales and profits. In communities, organisations and institutions 20% of the people make 80% of the positive contributions. And conversely 80% of the negative vibes circulating are caused by 20% of the people – the Vicious Few!
Typically then, causes, inputs or effort divide into two categories: the majority that have little impact and a small minority that have a major, dominant impact on outputs or results. For example, take “effort”: smart students know that 80% or more of exam papers can be well answered with in depth knowledge of 20% of the subject matter that the syllabus was meant to cover. The examiners are usually much more impressed by a student who knows a great deal about a relatively narrow range than only a fair amount about a wide range of topics.
Second insight: focusing on the vital few will dramatically improve the quality of your life! There are always a few things, a few people, a few friends, a few organisations, a few institutions (and so on) that are far more important to your happiness and well-being than the majority. This is invariably true. Richard Koch asserts that 80/20 thinking will definitely improve your life. The habit of looking everywhere for 80/20 insights will make your life more pleasant, easier and far happier. For example, putting effort into your vital few true friendships instead of spreading yourself too thin usually brings great rewards. Focusing your efforts on the vital few institutions or organisations you consider crucially important to Greyton will result in a far greater contribution to the well-being of our town than if you give a little of your time and effort to all of them.
Third insight: become what Koch calls a “time revolutionary” and only spend time on the 20% of activities that produce 80% of your achievements or happiness. In other words, forget managing time; rather identify the vital few things that really bring you joy – and focus totally on them. Also, identify the vital few things that result in your best accomplishments and focus your energy on them. And forget about the 80% of activities that are of relatively low value. Time revolutionaries make very good use of 20% of available time and in doing so discover that there is in fact no shortage of time! On the contrary, by making 20% of your time really count you can without guilt relax and play in the remaining 80%!
Johann Wolfgang von Goethe summed it up neatly many years before Richard Koch. “Things that matter most must never be at the mercy of things that matter least”
Go on; think about how the 80/20 Principle can apply to an area of your life right now; and ensure that you go and implement it. Then sooner rather than later look for a return on your investment far in excess to your input effort!
No comments:
Post a Comment