Sunday, January 15, 2012

Pareto Principle: The 20:80 Rule

Vilfredo Pareto discovered that 20 percent of pea-pods in his garden contained 80 percent of peas; he extrapolated that to his observation that 80 percent of the land was owned in the early-1900’s by 20 percent of the population.

The Law of the Vital Few, also known as the 80:20 Rule (Principle of Factor Sparsity) is an interesting and universal one. Without delving or stirring more contemptuous disregard for the often-maligned and misunderstood Bell Curve theory, suffice it to say it describes how most processes are engaged by a smaller group of action-orientated people. 20 percent of the top salespeople draw in 80 percent of the company’s profits. 20 percent of the giving population donates nearly 80 percent of the total funds in public charity.

The newly rejuvenated Triathlon Family of Singapore will deliver its annual TriFam Sprint event on 5 February. Do spread the word and invite your endurance-minded friends to join. We hope that the concerted efforts of less than 20 percent of the members can activate the participation and involvement of the other 80 percent. Already TriFam has attracted a significant pool of volunteers, many of who raced in the earlier series. Many of these have progressed to longer-distance races like Olympic Distance Triathlon, Half-Ironman, Ironman and ultra-marathons.

Celebrity DJ, Rod Monteiro is now a champion of stroke prevention after his case of acute stroke. The active sports-person is noted for being a very strong cyclist and runner, and a golfer with a low handicap. Perhaps, star-power can be amplified through publicity and positive word-of-mouth marketing to enhance education and active awareness on health and well-being.

Leadership Lessons: How would you apply Pareto’s Law to your favourite cause? How will you engage the other 80 percent on your team to excel? Which processes in your profession and business reflect Pareto’s Principle? How do you harness the social media platform to significantly support your cherished charities? How will you engage the other 80 percent of your performers on your team?

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