The 80/20 Principle: The Secret to Achieving More with Less

by Richard Koch

The 80/20 Principle asserts that a minority of causes, inputs, or effort usually lead to a majority of the results, outputs, or rewards. Taken literally, this means that, for example, 80 percent of what you achieve in your job comes from 20 percent of the time spent.

This helps to explain why those small minority of inputs can exert so much influence.

Equality ends in dominance: that is one of the messages of chaos theory. The 80/20 Principle’s message is different yet complementary. It tells us that, at any one point, a majority of any phenomenon will be explained or caused by a minority of the actors participating in the phenomenon. Eighty percent of the results come from 20 percent of the causes. A few things are important; most are not.

“The reasonable man adapts himself to the world. The unreasonable one persists in trying to adapt the world to himself. Therefore all progress depends on the unreasonable man.”15

Wealth from investment can dwarf wealth from working

Conventional wisdom is not to put all your eggs in one basket. 80/20 wisdom is to choose a basket carefully, load all your eggs into it, and then watch it like a hawk.

To engage in 80/20 Thinking, we must constantly ask ourselves: what is the 20 percent that is leading to 80 percent?

only do the thing we are best at doing and enjoy most • look beneath the normal texture of life to uncover ironies and oddities • in every important sphere, work out where 20 percent of effort can lead to 80 percent of returns • calm down, work less and target a limited number of very valuable goals where the 80/20 Principle will work for us, rather than pursuing every available opportunity. • make the most of those few “lucky streaks” in our life where we are at our creative peak and the stars line up to guarantee success.