Understanding Cause and Effect Using Pareto 80/20 Principle

The 80/20 rule, originating in business, has expanded its relevance to various aspects of life, including the workplace. It's widely understood that one should prioritize top-priority tasks at work. However, the challenge lies in identifying these tasks. The Pareto Principle, or the 80/20 rule, serves as a strategy to determine which tasks are most critical and which areas require the most focus to boost productivity.

What Is the Pareto Principle?

Italian economist Vilfredo Pareto developed the 80/20 rule in 1896. The guiding law of this principle is that about 80% of consequences result from 20% of causes. Simply put, a small portion of actions/efforts (causes) have grand effects (consequences). Got it?

Let’s put it this way, look at the mango tree. What percentage of the tree bears fruits? Do the trunks and branches bear fruit? So approximately about 20% of the tree can bear fruit. The parts of the tree that can bear fruit bear the most fruit.

This principle helps you identify the areas of your life, business, and projects that may not be the bulk of the activities but create the most impact. 

How to Use the 80/20 Rule

As previously stated, this rule is beneficial in all aspects of life, especially in economics and business. Imagine you've just arrived at the office and need to address the most crucial tasks. By applying the 80/20 rule, you would prioritize tasks that have the greatest impact. Which task would that be in your business?

If your work can be segmented into portions, this principle should help you identify what portions need your attention.

Let’s take a detour and test this principle on your romantic relationships:

It may only take stopping by the store to get some groceries (20% cause) to make your partner happy for the entire week or month (80% consequences).

Advantages of Using the 80/20 Rule

The most significant benefit of the Pareto principle is that you can create maximum impact with minimum effort. This principle should be your foundation if you want to work smart. The rule will help you and your team to stay on course and tackle the ‘big things’ while staying efficient. Consequently, you become more productive and focused.

The disadvantage of Using the 80/20 Rule

This is more of a misconception than it is a disadvantage. The 80/20 doesn’t mean that with 20% effort, you can get 80% results. The goal is not to minimize effort but to redirect it to a specific task that has the possibility of having an 80% impact. The downside is that you and your team may become too focused on these specific tasks that you lose sight of other issues.

Conclusion

You can find success in any area of your life by effectively applying the 80/20 rule. There is nothing that works better in overcoming your constraints than to begin creating impact. This principle is the cobblestone pathway that leads to your success in relationships, work, business, leadership, and every facet of your life.