The Pareto Principle is a concept that everyone can benefit from.

Business owners, entrepreneurs, professionals and even students can learn how to maximize their time and multiply their results using this system.

But how does it work and how can you apply it? Let’s take a closer look.

The Pareto Principle, also known as the 80/20 Principle was conceptualized by Joseph Juran in 1937. Also known as the “father of quality”, he concludes that “most of the results in any situation are determined by a small number of causes.”

In essence, the Pareto Principle is a theory that teaches us to focus and prioritize on tasks according to urgency and importance. The 80/20 formula is an analogy of the results and causes. The percentage can vary but, the fact remains that it is not true that 50 percent of our causes turns to 50 percent of results.

Pareto Principle for leadersTo quote Richard Koch;

The 80/20 Principle can and should be used by every intelligent person in their daily life.  By every organization, and by every social grouping and form of society. It can help individuals and groups achieve much more, with much less effort. The 80/20 Principle can raise personal effectiveness and happiness. It can multiply the profitability of corporations and the effectiveness of any organization.”

In business, the rule points out that 80% of your company’s revenue is generated by 20% of its total customers. Managers use this rule to identify which operating factors are most important and should receive the most attention.

Simply put, efficiency is important. As an entrepreneur, you should learn to channel all your energy and passion.  Do the things that would give better and more favorable results.

Pareto Principle quote

When used effectively, the Pareto Principle will let your business meet great efficiency and even increase your revenue.

Here are some tips on how Pareto Principle can help you as a leader and in making your business grow.

Emphasize key percentage

In applying Pareto efficiency into action, you drop the 80% of what you do which are non-essentials.

Pareto Principle delegate tasks

As a leader or entrepreneur, you must know how to delegate tasks. Get an assistant, outsource if necessary, or stop doing the things you found invaluable. Learn to focus your attention on the actions that give most to your business.

It’s also best to make a To-do-list and stick to it. Rank your tasks and put the most important ones in your top priority. This list should act as a guide in your daily life, so cross out those you have accomplished.

Cluster your Tasks

Make it a habit to organize your tasks, cluster all emails, purchases, teams, etc.

Pareto Principle clustering tasksThis would allow you to create more space for creative and collaborative tasks. Set time to attend to these things and dedicate your time to it.

Once done, take a break and return energized.

Remember, time management is as important as strategizing.

Allocate Resources

An entrepreneur should learn advertising techniques. Find those which are 20% costly but would offer 80% revenue.

Pareto Principle marketing

Identify key factors that create an impact on your business. What drive customer complaints? What is the most common customer feedback you’re getting? Once identified, it will be easier for you to focus and address it.

Your advertising strategies would depend on how you want to discuss these market failures. Keep in mind that you need to target your marketing approach to the correct problem.

Identify the “trivial many”

Although the Pareto Principle implies that you focus on vital 20%, it doesn’t mean that you have to ignore the remaining 80%.

You also need to discuss these things. That’s the reason why you need to hire people who can do the administrative tasks; so you can put the spotlight on the things that create more results.

Some entrepreneurs and leaders waste time on things and activities that do not produce great results.

Pareto Principle achieve more quotes

The rule of thumb for Pareto Principle is achieving more with less effort.

Keep in mind that the idea is for you find the imbalance of effects. And to focus your attention on those that provide more results.

Imagine how your business would look like if you can put Pareto Principle into practice.

Do you have other time management techniques you use? Share it with us today.


Build your brand’s voice, reach out to your market, and create a strong online presence through online marketing!

NextStep will help you extend your brand’s reach to China through WeChat and Weibo Marketing. Go local with content in Chinese, English, and French.

Contact us today and get to know more about our services!