The 80-20 Rule – The Pareto Principle

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The 80/20 Rule, or the Pareto Principle, is used for Critical Mistake Analysis and can be used to target training for the critical content of 20% that result in the largest impact of 80%

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The 80-20 Rule – The Pareto Principle

  1. 1. 80-20 Rule – The Pareto Principle
  2. 2. <ul><li>Inherent disparity between: </li></ul><ul><li>Cause and Outcome </li></ul><ul><li>Effort and Results </li></ul>80 % outcome 20 % cause 80 % Result 20 % Effort
  3. 3. The Pareto Principle means, “ Put your efforts where they will make the most difference”
  4. 4. <ul><li>A deeper analysis says: </li></ul><ul><li>5% of the causes generate 50% of the profits </li></ul><ul><li>50% of causes generate only 5% of profit or revenue </li></ul>
  5. 5. How to apply 80-20 Rule?
  6. 6. The 80-20 Rule can be applied in Time Management and productivity workshops
  7. 7. Important concept to plan your Sales achievements
  8. 8. 20% of your customers make up 80% of your budget
  9. 9. Keep your efforts on the remaining 80% of customers at a &quot;reasonable level&quot;
  10. 10. Identify key happiness triggers (20%) and ditch the activities (80%) that provide little or no satisfaction
  11. 11. Focus on activities that produce the best outcomes for you, professionally and personally
  12. 12. It reduces operating costs Operating costs
  13. 13. Helps Bridging the gap
  14. 14. Critical Mistake Analysis (CMA) : - a very good application of this rule
  15. 15. Critical Mistake Analysis can be used to target training to the critical content (20%) that result in the largest impact (80%)
  16. 16. Applications of the 80-20 Principle
  17. 17. The 80-20 Rule is used for the growth and development of business
  18. 18. Helps identify important problems
  19. 19. Go off unused stuff
  20. 20. Learn to use the tools you need the most
  21. 21. Do away with meaningless activities
  22. 22. Concentrate on your strengths
  23. 23. The Pareto Principle helps you focus on the biggest bang for your determination
  24. 24. To harness the power of the 80-20 Principle in your personal life, do the following
  25. 25. Ascertain how things happen
  26. 26. Pareto Principle is the Cornerstone of CRM or Loyalty Marketing Strategy
  27. 27. Pareto Principle best used as a gross Error Check
  28. 28. “ It is our attitude at the beginning of a difficult task which, more than anything else, will affect its successful outcome” --William James
  29. 29. To read more such articles, please visit blog.commlabindia.com

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