Tag Archives: 80-20 Rule

What Is the 80 20 Rule? (And How It Helps You Succeed in Life) | Life Hack

The 80 20 Rule or Pareto Principle, named after the nineteenth-century Italian economist, Vilfredo Pareto, who discovered that approximately 80% of Italian land in 1896 was owned by 20% of the population, has become a common axiom in business and life.

The principle was highlighted in 1992 by a United Nations Development Program report that showed that roughly 80% of the world’s wealth was in the hands of 20% of the population.[1] Businesses have reported that 80% of their sales come from 20% of their customers and, Microsoft discovered that if they fix the top 20%, most reported bugs they eliminate 80% of the problems in their software.

It seems the Pareto Principle is all around us.

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Save Time and Money With the 80-20 Rule in Marketing |All Business

The 80/20 Rule is a potent little principle that can increase your business revenue and make your life easier.

The gist of the 80/20 Rule is that you get 80 percent of your results out of 20 percent of your efforts. For example, 80 percent of your revenue comes from 20 percent of your customers, or 80 percent of your sales comes from 20 percent of your salespeople.

It doesn’t always come out as 80/20. It can be more extreme with 95 percent of the traffic coming from 5 percent of the roads on your commute, or 3 percent of your employees creating 67 percent of the errors. The point is that large results come from small efforts.

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