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Pareto Principle

80/20 Rule · Law of the Vital Few

Sketch of Pareto Principle

The observation that for many situations, roughly 80% of the effects come from 20% of the causes.

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Origin

In his 1896 Cours d'économie politique, Italian economist Vilfredo Pareto observed that roughly 80% of Italy's land was owned by 20% of the population. The pattern remained a curiosity until management consultant Joseph Juran generalized it in the 1940s as "the vital few and the trivial many," applying the 80/20 ratio to quality control and business problems.

Everyday Use

The 80/20 Rule reminds us of the disproportionate influence and important of certain items within any system — be they customers, data points, or hours in a day. Some examples might include that 20% of our coworkers cause 80% of the challenges, that 20% of our committed time brings 80% of our happiness, or that 20% of the pea pods in our garden produce 80% of the peas. It's a reminder that we ought not to give equal weight to all causes in our life when it's better to focus on the few that are having big effects.

Updated May 30, 2018