The 80/20 Principle

I recently read a refreshing book, in regard to time use and productivity, called, “The 80/20 Principle: The Secret to Achieving More with Less” by Richard Koch.

80/20 Principle

The 80/20 Principle is the idea that there is an imbalance between causes and results, inputs and outputs, effort and reward. Things often fall into one of these two categories:

  • The majority with little impact (80%)
  • The minority with an oversized or dominant impact (20%)

Use the Principle for Success

  • Remember a few things are always much more important than most things
  • Progress = moving resources from low-value to high-value uses
  • A few people add most of the value
  • Resources are always mis-allocated
  • Success is undervalued, under celebrated, and under exploited.
  • Equilibrium is illusory
  • The biggest wins all start small

Using the 80/20 Principle changes how we do things

  • We should reward exceptional productivity rather than raise average efforts
  • Look for shortcuts rather than the full direction
  • Look for the least possible effort to control our lives
  • Be selective, not exhaustive
  • Be excellent in few things, not good at many
  • Delegate as much as possible in our daily lives
  • Only do things we are best at and enjoy the most

Simple is Beautiful

  • Complexity leads to less effective 80%, but the simple leads to effectiveness and success – Reduce complexity
    • Managers love complexity, but it is the enemy of profitability
    • Waste thrives on complexity
  • Focus on what brings results, to bring more results. Do not fall for the trap of contributing to overhead.
  • Go for the simplest 20% – always identify and cultivate this simplest 20%
  • More is worse

Large and simple business is best.

All organizations are a mix of productive and unproductive forces: people, relationships, and assets


  • Be marketing led in the few right product / market segments.
  • Be customer centered for the few right customers.

Decision Rules

  1. Not many decisions are very important
  2. Most important decisions are often those made only by default
  3. Gather 80% of the data and perform 80% of the relevant analyses in the first 20% of the available time, then make a decision 100% of the time. Be decisive as if 100% confident this is the right call.
  4. If what you decided isn’t working – change your mind early rather than late
  5. When something is working well, double and redouble your bets

Project Management

  • Simplify the objective
  • Impose an impossible time scale
  • Plan before you act
  • Design before you implement


  • Few points in a negotiation really matter
  • Don’t be impatient (wait for the last 20% of time when things get going)

Think 80/20 (not 50/50)

  • Think skewness – expect 20% -> 80% and 80% -> 20%
  • Expect the unexpected
  • Expect everything (time, organization, market, etc) to have quality 20%  and look for it
  • Expect tomorrow’s 20% to be different than today’s 20%

Act 80/20 (not 50/50)

  • When you see a 20% activity – make the most of it
  • Use your resources (talents, money, friends, money, etc) to magnify and exploit 20% you find
  • Use alliances with other people extensively, but only ally yourself with 20%
  • Whenever possible, move resources from 80% activities to 20% activities
  • Innovate new 20% activities
  • Ruthlessly prune 80% activities


It is not the shortage of time that should worry us, but the tendency for the majority of time to be spent in low-quality ways.

  • Dissociate effort and reward – be economical with your energy
  • Give up guilt – do the things you enjoy
  • Free yourself from obligations imposed by others
  • Identify the 20% that gives you 80%
    • Identify your happiness islands – what contributes disproportionally to your happiness
    • Identify your unhappiness islands
    • Do the same for achievement islands and achievement desert islands
    • Look for commonalities and act accordingly
  • Multiply the 20% of time that gives you 80%
  • Eliminate or reduce the low-value activities


Attributes for strong relationships.

  • Mutual enjoyment
  • Respect
  • Shared experience
  • Reciprocity
  • Trust


  1. Identify when you are happiest and expand these times as much as possible
  2. Identify the times you are least happy and reduce these times as much as possible


  • Change the way you think about events (Re-frame) – Be optimistic
  • Change the way you think about yourself – Cultivate a positive self-image
  • Change your events
    • Change the people you see most – see those that make you happy and avoid others
    • Avoid things that upset you

Seven Daily Happiness Habits

  1. Exercise
  2. Mental Stimulation
  3. Spiritual/artistic stimulation/meditation
  4. Doing a good turn (think of others)
  5. Taking a pleasure break with a friend
  6. Giving yourself a treat
  7. Congratulating yourself

Seven Shortcuts to a Happy Life

  1. Maximize your control
  2. Set attainable goals
  3. Be flexible (when chance events interfere with plans and expectations)
  4. Have a close relationship with your partner
  5. Have a few happy friends
  6. Have a few close professional alliances
  7. Evolve your ideal lifestyle