Saturday, 6 April 2013

How well are you managing your 80 ?

This  week was really bad for me.  

There were lots of meetings  -  most of them urgent  ,  adhoc tasks ,  too many transactions to be completed both at work and at home and so on and so forth. I usually plan and make goals for the week.  So , on Friday evening when  I sat down to check how much I had achieved of these goals,  I was really dismayed !   I was reminded of the 80-20 rule and I would like to elaborate on this.

This may come as a surprise, but despite all the talk about life balance, we  can benefit  by introducing a little imbalance into our day. I'm referring to the 80/20 rule, which is rooted in what is known as the Pareto Principle.

Vilfredo Pareto was an Italian scientist.  In 1906, Pareto observed that 80% of income in Italy was received by 20% of the Italian population. Pareto's theory of predictable imbalance has since been applied to almost every aspect of modern life.

When applied to work, it means that approximately 20 percent of our efforts produce 80 percent of the results. Learning to recognize them and then focus on that 20 percent is the key to making the most effective use of our time and effort.

Finding the 80/20 ratio is crucial for maximizing performance in any business. We have to identify the products or services that generate the most income (the 20 percent) and drop the rest (the 80 percent) that only provide marginal benefits. Spend the time working on the parts of the business that we can improve significantly with our core skills and leave the tasks that are outside our best 20 percent to other people. Work hardest on elements that work hardest for us. Reward the best employees well, cull the worst. Drop the bad clients and focus on upselling and improving service to the best clients.  

Sounds easy? But in reality, the identification of the 80 and the 20 is the most difficult.

Sample situations :

·  80% of process defects arise from 20% of the process issues.
·  20% of  sales force produces 80% of  the  company revenues.
·  80% of delays in schedule arise from 20% of the possible causes of the delays

There is also a management theory floating around at the moment – which may be a bit controversial , that proposes to interpret Pareto's Principle in such a way as to produce what is called Superstar Management. The theory's supporters claim that since 20 percent of your people produce 80 percent of your results, you should focus your limited time on managing only that 20 percent, the “superstars”.

The  80 - 20 Rule, should serve as a daily reminder to focus 80 percent of  our time and energy on the 20 percent of  our  work that is really important. We should not just  "work smart",  we should work smart on the right things.  

Another term for this rule is "The Vital Few and Trivial Many."  As a side-note , another of Pareto's controversial theory  is that human beings are not, for the most part, motivated by logic and reason but rather by sentiment – but this is another topic altogether and I will talk about this some other time !

Apply the 20 to work for your Vital 80 and enjoy your  weekend !


  1. This is excellent and I have seen this working with an amazing result in our software testing world as well. It starts from creating a list of functionality of the product needs to be tested to the test case prioritization. Once we complete the list of functionality, we prioritize them based upon their complexity and the usage and put the initial focus on the same which help us in identifying the critical and high priority defects during the early testing cycle. and that's the way of performing the testing like identify the critical defects during the early testing phase which will help you in testing medium and low priority functionality smoother and faster and meeting the deadline.


  2. Either way 80/20 or 20/80,these simply compliment each other-Neither the positives nor the negatives,would be worth discussing,in the absence of one-Whether it is the work force,or the process,you will find a similar ratio percolating when the final analysis is done-Even the most successful companies,resort to product recall,while its a constant review of economics,and human resources that gives an entity the all important edge over the other-I would draw your attention to the fact,that its instinctive when you focus on the 20 to gain 80,the cream on the biscuit-But mind you this creamy ratio is not constant-Managing the 80 percent,is what evolving techniques is all about-We tend to value the lesser-(20 percent)and the more-(80 percent)as long as this translates to 80 percent of vital parameters,which indicate a healthy entity-When it comes to sustenance over long periods,100 percent should be the target,but alas the depletion begins almost from day one-This is bound to occur when you pick and choose,market forces compel you to do so,and as long as this is the case,only weekends,will be enjoyable-Yes at the core human beings,are sentimental,a trait that runs in the 100 percent-When we re write this ratio,the sanctity is lost,and all our theories and conclusions gain prominence-This is not how it was meant to be-
    Sincere Regards
    Vijay Nair