How to work smarter, not harder, with the 80/20 rule

Phoenix Business Journal by Ray Silverstein, Guest blogger

Date: Monday, April 30, 2012, 2:42pm MST

Ray Silverstein Guest blogger - Phoenix Business Journal

Years ago, when I was young entrepreneur, I found myself bragging to a young lady about how efficiently I ran my business. She wasn’t that impressed. “It’s nice to be efficient,” she said, “But are you effective?”  She had an excellent, if not flattering, point. There’s a big difference between being busy and doing things that matter. The most successful businesspeople I know are the ones who can focus on the big picture, instead of getting distracted by “small stuff.”
And let’s face it, our days are overflowing with small stuff. We all have too many things on our to-do lists. Because we enjoy the satisfaction of crossing things off those lists, it’s tempting to spend time on trivial tasks at the expense of really important ones. But we don’t become more successful that way. Doing isn’t the same as achieving. The key is to prioritize our activities so we’re investing our time and energies where it matters most.

The 80/20 Rule can be a very helpful tool when it comes to setting priorities. You’re probably familiar with this principle in one context or another.

As far as I know, the concept was first proposed by Vilfredo Pareto, a 19th Century Italian economist. After studying Italy’s economy, Pareto concluded that 80 percent of Italy’s income was associated with 20 percent of its population.  In larger terms, ‘Pareto’s Theory of Mal-distribution,’ as it was first known, suggests that 80 percent of output comes from 20 percent of input. Turn it around, and it means that a small percentage of our efforts generate a large percentage of our results.

Now, apply that concept to the way you manage your time. Of all the activities you engage in, what tasks actually create revenue for you, and what is essentially trivial? Which activities propel you forward, and which ones are really holding you back?  That busy work is, in fact, destructive. Once you’ve identified it, your job is to get it off your desk. Can you delegate it? Automate it? Outsource it? If you must address “small stuff,” why not set aside a fixed block of time, say, one afternoon per week, for cleaning up clutter. The point is to keep your main focus on doing things that count.


Sometimes, we busy ourselves with small activities because we’re not sure how to tackle the big ones. In that case, create an action plan. Break a massive project down into small, concrete steps that you can tackle one by one. You can even cross them off your list.


It’s helpful to review other aspects of business through the 80/20 prism, too.  For example, look at your customer base. What “20 percent” of customers generate “80 percent” of sales? The numbers may vary, but the principle won’t. Analyze what characteristics your best customers have in common, so you can target more prospects like them.

Or, consider what additional products or services you could be offering these key accounts. How can you leverage up on the relationships that matter?

Or, study your workforce through the 80/20 lens. Who’s getting the work done and who’s coasting? You can use this knowledge to manage your employees more effectively and ramp up productivity.


In short, our time and energy is finite. Applying the 80/20 rule to your business can help you use both more effectively. Need a push to get started? Email me at ray@propres.com and ask for a copy of my 80/20 Worksheet. It will give you some ideas for getting the most ‘bang for your buck.’