More formally the 80/20 rule is also known as the Pareto Principle. To Quote Wikipedia: "The Pareto principle? known as the 80-20 rule, the law of the vital few?Business management thinker Joseph M. Juran suggested the principle and named it after Italian economist Vilfredo Pareto, who observed that 80% of income in Italy went to 20% of the population."
We hear the 80/20 rule as it is applied to business and sales. Twenty percent of your employees produce 80% of a companies problems, 80% percent of your corporate sales are produced by 20% of your sales force and in network marketing, 80% of your profits may come from 20% of your distributors. We hear of it as it relates to wealth and wealth accumulation: 80% of the money is controlled by 20% of the people.
Joseph Duran was born in 1904 and he credited this principle to an economist who lived in the 1800's. Is the Pareto Principle an abstract economics principle or is it a model of human behavior?
Going back an estimated 5000 years we see a beautiful example of the 80/20 rule in the Old Testament: Numbers 13 and 14. After an arduous journey through the desert, the Israelites arrived at the borders of the promised-land. Finding it already occupied, Moses sent an exploration party, a representative from each of the 12 tribes of Israel, to explore the land and bring back a report. Ten of the party members brought a negative report: the land flowed with milk and honey but the current occupants were powerful and their cities were large. They recommended retreat. Two brought a positive report and recommended taking possession of the land. Seventeen percent of the exploring party were in agreement with taking the land and 83% were opposed to taking the land. Two disparate courses of action though they were all members of the same exploration party and saw the same things. A curious thing happened, the 80% then went to the whole of the Israelites and caused them to abandon heart and not take the promised land. The Israelites were not able to take the promised land until the 80% and were gone.
There are 5 lessons here that can be applied to business
1) New Ideas will be Opposed: Business innovation and success are governed by vision. Yet in any corporate structure, the 80/20 rule describes human behavior: 80% of people will oppose a new idea concept or vision and 20% will support it.
2) The majority will seek to garner support for their opinion usually among those people who do not have all the facts, in this case the people who did not have direct experience with the promised land, and disrupt positive moves of the corporate body.
3) Facts alone will not persuade. All members of the exploration party went to the promised land. They all received the same facts, yet 10 of them did one thing with the facts they received and 2 did another. What they each did with the facts they received was colored by their vision and purpose.
4) Movement in any business is governed by vision; in order to move in a given direction, a company may have to shed the part of its work force that does not tap into the overall corporate vision. If 20% of the people at any given time catch the vision, the other 80% will find themselves vulnerable. I explore this concept further in my companion article, "Moses, Death and the Entrepreneur's Journey"
5) Change is inevitable and necessary for growth in any organizational structure. In this story, the Israelites could only possess the land when the 80% who lacked vision had been replaced.
Using this model of human behavior and the lessons it teaches can allow any business owner, whether a free agent or the owner of a traditional business, to focus on the few strategies and the few key individuals that can bring a business success rather than attempt to persuade the majority of the rightness of a course of action.
My experience as a line manager, senior manager and organisational psychologist over the last thirty years, means that I have attended and run many meetings. In my work, one of the most common complaints I get from all levels of the organisation, is that "We waste so much time here sitting around talking. Nothing gets done as a result". Why are so many meetings a waste of time?
My conclusion is that the vast majority of meetings: - Cover information that could be distributed by other means - Focus too much on the past - what has gone rather than what is to come - Do not have a clearly defined purpose with intended outcomes
So, if you have to run meetings, the first decision to make is to decide what type of meeting it is - - Is this an information sharing meeting or a problem solving meeting?
If it is an information sharing meeting, then there are two guides to follow: 1. Can the information be distributed in another way (eg email etc)? In this case there is no need for the meeting, thus saving a lot of time. 2. If the need to share the information must be by way of a meeting, then the focus of the meeting (and time spent) should be - 20% past oriented - i.e. reporting on the information (e.g. results) and - 80% future oriented - i.e. deciding what we are going to do with the information.
Using the "80/20 rule" for your meetings will ensure that everyone participates and can see some real advantage to having the meeting. By the way, if you are a participant in one of those boring meetings we mentioned earlier, it is possible to have some influence on the meeting process. Keep asking "What are we going to do with this information?" or, "How should we proceed now?". In other words, every time the meeting starts to focus on the past, redirect it to the future.
If it is a problem solving meeting, then there are five steps to follow to ensure the meeting is a positive one with some productive outcomes.
As with Information sharing meetings, quite often problem solving meetings don't reach their full potential because the meeting dwells too much on the present or past situation, rather than "how things ought to be". Using the following five steps will ensure that your meeting stays focused on the future and is productive.
1. Ask each participant to prepare for the meeting a few days in advance (one week is ideal, but not always possible) by jotting down some notes in answer to a short "meeting question". They need to bring these notes to the meeting.
2. The meeting pre-work question must be framed on the assumption that the problem has already been solved - ie. it must be expressed at some future time. For example, if a telephone service department were looking for ideas on how they might improve their service, the question might be put: "Assume that we have just had a very successful year, and that we have received heaps of feedback which suggested our service given to customers has been first rate over the last twelve months: - What things did we do to get such great success? - What problems or challenges did we have? - How did we solve these problems or meet these challenges?"
3. At the meeting ask all participants for their ideas and list these on a whiteboard or flipchart paper etc. Note. It is very important to list these ideas so that everyone can see them - this helps maintain people's interest, keeps people focused and is useful for keeping the meeting on track.
4. When the meeting has reached consensus on which items are worthwhile and achievable, two further columns are added to each flip chart page. One column is headed "By when" and the other is headed "By whom"
5. It is important that the workload is shared by all participants. In the first column "By when", the group is asked to allocate a time for when this aspect could be achieved. When this is agreed, people are asked to volunteer to undertake responsibility for ensuring particular items are undertaken (not necessarily to do them, but to take responsibility for them), by placing their name in the "By whom" column. Once this is done, the meeting now has an action plan for solving the problem. This can be written up and distributed to people following the meeting.
I have used this process at all levels of organisations and with mixed stakeholder groups with amazing success over the last 20 years. Whether your meeting is an information sharing one or a problem solving one, I'm sure that using the guidelines set out in this article will make them more rewarding for everyone. If you would like some free advice on how to construct your "problem solving" meetings, or to discuss any aspects of meetings, please contact me at www.nationallearning.com.au
Both Ouida Vincent & Bob Selden are contributors for EditorialToday. The above articles have been edited for relevancy and timeliness. All write-ups, reviews, tips and guides published by EditorialToday.com and its partners or affiliates are for informational purposes only. They should not be used for any legal or any other type of advice. We do not endorse any author, contributor, writer or article posted by our team.
Ouida Vincent has sinced written about articles on various topics from Management, Lead Generation and Aquarium Fish. Like most people I went to school to get an education and learn a profession. When I graduated and began working, I realized something was very wrong. The path that I thought would lead me to freedom was instead leading me into quicksand. I got out of. Ouida Vincent's top article generates over 135000 views. to your Favourites.
Bob Selden has sinced written about articles on various topics from Management, Customer Service and Education. Like most managers, Bob Selden has conducted and participated in hundreds (possibly thousands) of meetings during his career as an operator, line manager, senior manager and organisational psychologist. Currently he is MD of the National Learning Institu. Bob Selden's top article generates over 27100 views. to your Favourites.