80 percent of your resources are producing,only 20 percent of value.That is one of the ways for innovators and entrepreneurs,to create opportunity, evaluate ideas quickly or maximize their power.
[box] The 80/20 Principle, helps you identify, the forces that are hidden, to achieve progress, to give maximum power, to the most productive force, and can stop the negative influences.[/box]
The 80/20 Principle is about imbalance between:causes and consequences, inputs and outputs,and effort and result.Minority of causes lead to a majority of consequences.
[box] It states that a few things are important, but most are not. It reminds you to focus on the 20 percent that matters. Identify and focus on those things.[/box]
In 1906, Italian economist Vilfredo Pareto created a mathematical formula,to describe the unequal distribution of wealth,observing that twenty percent of the people owned eighty percent of the wealth.Dr. Juran’s also made an observation of the “vital few and trivial many”,when 20 percent of something are responsible for 80 percent of the results.That became known as Pareto’s Principle or the 80/20 Rule.The 80/20 numbers are only a metaphor.The art of using 80/20 principle is is to identify that 20 percentand exploit it as much as possible.The thing about this metaphor is that it can be applied to any job,industry, organization or function, even to a nature.
To achieve progress, you must give power to the 20 percentyour most powerfull sources in terms of achievement.Applied to your daily life, it can help you to concentrate on the most important20 percent and how to change behavior.But, you must ask yourself,what is the 20 percent that is leading to 80 percent.Take some time to think.It is ok not to automatically know what the answer is.Applied to the business,it is about how to generate money and create stakeholderin the terms of great and with the least efforts.Also the key theme of the 80/20 principle is tofind out where you are loosing your money.The thing is that you have to identify spheres where you aremaking great profit and to maximize them,and to spot the places where you are loosing your profit.