The Pareto Principle (The 80/20 Rule)

Originally, the Pareto Principle referred to the observation that 80% of Italy’s wealth belonged to only 20% of the population. Vilfredo de Pareto was an Italian sociologist and economist who, during his studies, realized that, in general, 80% of a nation’s income was in the hands of only 20% of the population.

Source: Medium

It can mean the following things:

  • 20% of the input creates 80% of the result
  • 20% of the workers produce 80% of the result
  • 20% of the customers create 80% of the revenue
  • 20% of the bugs cause 80% of the crashes
  • 80% of the pollution originates from 20% of all factories
  • 20% of employees are responsible for 80% of the results
  • 20% of students have grades 80% or higher

In economic terms, there is a diminishing marginal benefit. This is related to the law of diminishing returns: each additional hour of effort, each extra worker is adding less “oomph” to the final result. By the end, you are spending lots of time on the minor details.

Make decisions on allocating time, resources and effort based on this:
• Instead of spending 1 hour drafting a paper/blog post you’re not sure is needed, spend 10 minutes thinking of ideas. Then spend 50 minutes writing about the best one.
• Instead of agonizing 3 hours on a single design, make 6 layouts (30 minutes each) and pick your favorite.
• Rather than spending 3 hours to read 3 articles in depth, spend 5 minutes glancing through 12 articles (1 hour) and then spend an hour each on the two best ones (2 hours).

Note: The Pareto Principle is an observation, not a law of nature.

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