80/20 Principle Can Transform Your Life

It does sound static when you think about the 80/20 principle (aka the Pareto principle) especially when you are not a big fan of math. But the good thing about the 80/20 principle is that you don’t have to understand statistics to be a believer and can be well understood even if you are not an economics professor. According to this principle, 80 per cent of the results come from 20 per cent of the causes.

The 80/20 rule requires you to identify the few actually important things that are happening and to ignore the unimportant stuff. With this rule, you come to understand that thinking is reflective, unconditional, strategic, and nonlinear.

80/20 in Happiness:

Happiness and money are two different things. Money is something that can be spent, invested, and can even be multiplied through compound interest. But happiness, on the other hand, not spent today does not lead to happiness tomorrow. People who understand the 80/20 rule know what generates happiness and pursue it consciously as well as intelligently. But there are very people who actually understand how to cultivate their own happiness and seek indirect goals like money or promotions which are difficult to attain.

80/20 in investment:

The 80 per cent of the increase in wealth from most long-term portfolios comes from less than 20 per cent of the investments. Picking this 20 per cent is crucial and then you better concentrate on as much investment as possible.

80/20 in relationships:

It does not count how many relationships you have, it depends on what kind of a relationship you have with your loved ones. The relationships that you have should be there when you need their support and have a common interest in advancing towards your goals.

80/20 at work:

At work, 80 per cent of the values come from 20 per cent of the professionals. The employees who are above average are paid higher as compared to the ones who are below average. It has been seen that even the best employees remain underpaid and the worst people always overpaid.

80/20 in Winning:

In any completion, there are always some winners and some losers. By choosing the right kind of competition, you can be a winner as well. You just need to use the right methods because you are more likely to win by striving to improve your performance. And when you are selective about the races you join.

80/20 in Time Management:

When it comes to time management, it is considered that 800 per cent of the achievement is attained in 20 per cent of the time taken. But most of the time what you do is low value whereas even the smallest fragments of time are even more valuable. Therefore, treat your time as valuable as you can and use it most appropriately.

80/20 in Business:

You can use the 80/20 rule to redirect your business strategy by keeping the vital few in front of you to work on. You can make it a rule that few people can add most value to your business. If you have the right professionals, it can generate enormous surpluses.

The 80/20 in Project Management:

With the help of 80/20 rule, you can plan your project. Write down all important issues that you want to resolve, construct hypothesis, work out what information you require, decide who is to what, and re-plan after short intervals that is based on new knowledge or any divergence from your previous guesses.

80/20 in Negotiation:

It is a habit of people to win even those points that are most unimportant. Therefore, they respond to concessions even the smallest ones. Therefore it is necessary that you build up a list of spurious concerns and requirements early in a negotiation. Make them seem as important as possible and in the closing stages of negotiation, concede the points that are unimportant in exchange of the actual important ones.

Written by Hisham Sarwar


That is all you ever need to know about me but let me warn you, freelancing for me is a journey, certainly not a destination :)