Numbers Don't Lie

Sunday, May 07, 2006

Pareto principle

The Pareto principle (also known as the 80-20 rule, the law of the vital few and the principle of factor sparsity) states that for many phenomena, 80% of the consequences stem from 20% of the causes. It was named after the Italian economist Vilfredo Pareto, who observed that 80% of income in Italy was received by 20% of the Italian population.

The idea has rule-of-thumb application in many places, such as:

Work - 20% of your efforts produce 80% of the results.
People - 20% of the people you know (friends, colleagues, family) provide you with 80%
of nurturing support and satisfaction.
Business - 80% of the sales are made by 20% of the sales team.
Focus - 20% of your activities will account for 80% of your success.

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4 Comments:

Blogger brad said...

There's a quote attributed to Wood Allen: "80% of success is just showing up".

5:44 AM

 
Blogger Telescope of Hao Tang said...

I'd rather see him as sociologist. His theory of elite ruling is significant in sociological academia

7:01 PM

 
Blogger Freeman76 said...

20% of the people pay 80% of the taxes?

10:28 PM

 
Anonymous Anonymous said...

And of course, the statistics are completely made up, and so proof is offered.

11:51 PM

 

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