80/20 rule

Books are the cheapest way to learn without making mistakes of my own. Everybook equips me with a pair of lens and help me view the world in a different way. It is upto me to use these lenses at the right situation and the right time. It can also be called as mental model or framework. I somehow like the term lens.

One such lens I added to my kitty in this year is the 80/20 rule. It is also commonly called the Pareto principle. 

80/20 rule says 80% of your results come from 20% of your efforts, and 20% of your results come from the other 80%.

Lets take business as a example. The rule says that in any business, the 80% of revenue comes from the 20% of the customers. 

This is a powerful rule, not only applicable for business but in all aspects of the life. In fitness, 80% of the outcome might be dependent on only 20% of activities like sleep for 8 hours and exercise for 30 mins a day. By missing this simple activity, if we try fancy diets or supplements or shiny tips, the improvement in the outcome might be very minimal.

In sales & marketing, it might make sense in the initial days to try out different modes of selling or marketing. But once we figure out the customers, market and product, the growth might be entirely dependent on only very few activities. Doing shiny things might be very attractive, but the outcome might be very very minimal.

In some of the cases, instead of 80:20, this ratio might be 70:30 or 90:10. But once I recognize this disparity and start viewing activities, it is such an amazing lens to understand the world and thrive in it.