Applying Pareto’s Principle To Your Life
The Pareto principle states that for many outcomes, roughly 80% of consequences come from 20% of causes (the “vital few”). A well-observed phenomenon, it creates for a simple and fascinating pattern when you see it at play.
80% of the world’s population lives on 20% of its land. As of 2018, 87% of the US income taxes came from 20% of its populations. In product marketplaces 80% of the usage and revenue tends to come from 20% of users, and relatedly, 80% of the earnings come from 20% of the creators.
At the start of a year, I spend some time reflecting on and writing down my annual goals. More often than not, the list runs too long and by the time I check in mid-year, I find it impossible to catch up and almost discouraging to continue making progress.
I made a U-turn in 2021, in no small part triggered by the pandemic and renewed appreciation for the value of time. I zoomed out and imagined what would matter most to me if it were my last day on earth — and found the answer surprisingly straightforward: Good health, quality relationships and a meaningful impact through my career work. Zooming back in, this provided a clear framework for prioritization. More importantly, I found my time aligning with Pareto’s principle, where channeling 80% of my time to the 20% of life’s priorities created joy and peace. That doesn’t take the busy work away — laundry, home chores, returns, taxes — but it does let me manage them in a way where they don’t take up more time or space than they should, intentionally. The same applies at work — as a leader, identifying the 20% of the things that drive 80% of the value for your team creates a culture of trust and empowerment. You’ll find your team is more independent and autonomous, seeking your input on the 49–51 decisions and surfacing the areas they truly feel blocked on, which in turn can inform your priorities.
What are the place in your life where you’ve found the Pareto’s Principle to be in effect? Do you see 80% of your business outcomes driven by 20% of your users? Do you see 80% of your health goals achieved through 20% of the lifestyle choices? Do you find that 80% of your happiest moments come from the 20% of the relationships in your life? You have your answer on what to focus on.