I THINK most people have heard of the 80/20 rule, also known as the Pareto Principle. What it means basically is that 80 per cent of the effects come from 20 per cent of the causes.
In business, it is often the case that 80 per cent of revenues come from 20 per cent of the clients.
It can also be suggested that 80 per cent of your problems come from 20 per cent of your clients.
The late American entrepreneur and motivational speaker Jim Rohn would suggest: “Spend 80 per cent of your time with the 20 per cent that produce the most.”
In a perfect world, you might be able to use that data to fire 20 per cent of your clients, replace them with “better clients” and hence your business would improve. In reality, life is never that simple.
This principle is, however, a very handy way to look at your efforts at work because very often, an 80 per cent solution is perfectly adequate.
And if it can be achieved with 20 per cent of the effort that would be required for a 100 per cent solution, then that is often a far better answer than expending the other 80 per cent effort to go from 80 per cent to near perfection.
Don’t get me wrong — if you are a surgeon, an 80 per cent success rate for your operations is clearly not acceptable.
Equally, if you are a pilot, then 80 per cent of your landings being good is not acceptable either!
However, if you are developing an IT project, then just maybe a solution that meets 80 per cent of the needs but is developed at 20 per cent of the cost would be a great answer.
If you are producing internal reports, do they need to be “pretty” or do they need to be functional?
If they are readable and professional, is that OK — or do they need to be in colour, formatted to the “nth” degree and of publisher quality?
Well, sometimes they do and sometimes not.
Business common sense
This is where business common sense comes into play.
Ask yourself some basic questions:
• Does the 80/20 rule apply to my situation?
• Will the extra effort it will take to improve my result “here” be better spent elsewhere?
• Will the extra effort it will take to improve my result be time well spent?
• Am I aiming for perfection at the expense of practicality?
• Will my client be happy with the result I am providing? (Note that it can be an internal or external client.)
Do bear in mind the following caveats:
• Quality is always something to strive for... but it needs to be viewed through the lens of practicality. If you achieve perfection but the result is unaffordable, then you lose.
• Never undermine an employee’s commitment to excellence, but if applying a “common sense” approach will help him to be more efficient, it is worth teaching that lesson.
As management consultant F. John Reh said: “The 80/20 rule should serve as a daily reminder to focus 80 per cent of your time and energy on the 20 per cent of your work that is really important.”
Article by Kevin Dee, chief executive officer of Eagle, one of Canada’s largest professional staffing companies. For more information, visit www.eagleonline.com/blog/. Article source: http://EzineArticles.com/?expert=Kevin_Dee