The Pareto principle -what is it and how can you use it in your improvement actions?

Many of my clients often are overwhelmed with the size of tasks and data that is required when implementing a new system and it's always in the back of my mind to bring things back to the Pareto Principle. So what is the Wikipedia definition?
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 events, roughly 80% of the effects come from 20% of the causes.

Business-management consultant Joseph M. Juran suggested the principle and named it after Italian economist Vilfredo Pareto, who observed in 1906 that 80% of the land in Italy was owned by 20% of the population; he developed the principle by observing that 20% of the pea pods in his garden contained 80% of the peas.[2]
It is a common rule of thumb in business; e.g., "80% of your sales come from 20% of your clients".

So why does the pareto principle figure so prominently in productivity? Because it reduces time wasted on things that are not important or not important right now. Why spend time worrying about the 500 parts that need to be added to the system because we might get an order sometime, rather get right the ones that are being ordered constantly. Of course this needs some measurement to find the 80% ( or 20%) but most of the time gut feeling gets you to the same place.

So next time you have a project keep in mind Signor Pareto and think "can I break this down" so you can get the best bang for your buck quickly.

Save some ....and spend it doing something you love.

Till my next post  OR if you would like to comment send me an email at This e-mail address is being protected from spambots. You need JavaScript enabled to view it

Tim