Distinguishing the Important Few from the Trivial Many
Vilfredo Pareto was an Italian economist who observed that in the Italy of his day, 80% of the wealth was owned
by 20% of the population. The Pareto Principle states that 80% of results flow from 20% of their causes. Though the
percentages may not always be exact, there is often a disproportionate effect by an 'important few' causes.
So, for example:
80% of sales come from 20% of product lines in a supermarket (or warehouse).
80% of wear (and dirt) on a carpet is in the 20% of surface area nearest to the door.
80% of profits come from the best 20% of customers.
80% of headaches are caused by those few 20% of your colleagues(!).
etcetera
The point is that if you can distinguish the 'important few' from the 'trivial many' then you can focus on where attention is
most needed - on the positive side those few profitable customers, on the negative side, the few causes of most of your problems.
Note: This web page is not intended to provide comprehensive coverage of the subject, merely a brief introduction to provoke thought and to lead to a more in depth understanding and application of the topic, either through further reading - or from me as your management consultant, executive trainer or personal coach in a consultancy project, training course, workshop or seminar.
References and Further Reading
Koch, Richard. The 80:20 Principle. Nicholas Brealey Publishing.1998.