The Pareto Principle or Pareto’s Law is perhaps more widely known as ‘The 80/20 Rule’. I would be willing to bet the brand new Porsche that I don’t have that you’ve come across this term if you’ve spent any time in and around a project in the last 10 years. I’d also be willing to bet my new non-existent Aston Martin that you’ve heard it used completely out of context too. Allow me to explain.
What the Pareto Principle IS
The Pareto Principle was developed by an Italian economist (funnily enough named Pareto) in the early 20th century. He noticed that 80% of the land in Italy was owned by the richest 20% of the population. The principle has since been applied to all kinds of walks of life from 80% of the harvest of peas coming from 20% of the pods to 80% of many companies’ incomes being generated from 20% of the customers. In short the Principle is perhaps best stated as 80% of the output is generated by 20% of the activity.
What the Pareto Principle ISN’T
An excuse to slack off! The amount of times I’ve heard people say, “I’m done with this document, it’ll do as it is. You know, 80/20 rule and everything. Ha ha ha!”.
Now I realise that this is in danger of sounding like a rant but it isn’t. I promise. It is a cautionary tale as for many years I fell into the latter category in terms of what I understood the 80/20 rule to be. Tending to seek perfection in everything I do I took comfort in knowing that there was this rule that said “Hey man, relax, if it’s 80% of the way there it’s probably good enough”!
I was however recently introduced to the correct definition via the book “4-Hour Work Week” by Tim Ferriss and after a bit more reading I’ve found that the 80/20 rule is one of the most powerful pieces of knowledge available to a Project Manager.
I’ve been using it constantly to assess my to-do list; “Which of these things are going to be in the 20% of activities that deliver the 80% of the project as they should get priority treatment”. I’ve been using it to aid in editing down team members documents and PowerPoint presentations; “This is soooooo long it will be ‘Death by PowerPoint’ for attendees, if I can leave only 20% of the slides in and still get the key messages across which ones would they be?”.
It’s insane, I’m achieving as much as before but with far less input being required. Sure, the other 80% of the things on the to-do list may all need doing but I know that I’m prioritising the things that have the greatest impact.
Perhaps it’s something that most people do intuitively and I’ve just been hopelessly disorganised up until now but, if you haven’t already, see how you can apply the principles to your project and let me know how you get on!