Editorial Comment

The 80/20 principle essentially suggests 20% of the work you do produces 80% of the results. The principle can be applied to many things in life: economics, time management, safety, health and social issues, and even sports. In theory, sales and business management, 80% of sales tend to come from 20% of your clients. In the Wins Above Replacement concept in sports, experts use statistics to sum up a player’s contributions to the team – and results suggest 15% of baseball players produce 85% of total wins.

The 80/20 rule is not a new concept in the business world. It has been written about by Brian Tracy, in Entrepreneur, Forbes, and a plethora of other places in recent history. The concept itself, though, dates back to the University of Lausanne in 1906, when Italian economist Vilfredo Pareto noted the 80/20 connection in that 80% of the land in his country was owned by 20% of the population.

Let’s think about your restoration company for a moment. If 20% of your efforts produce 80% of the results, are you putting your best efforts into the right places? The same goes for marketing – are your best efforts going to the best, most logical places?

Here is a quick example. Let’s say you have 10 project managers on your team. According to this rule, two of those PMs will run 80% of your company’s jobs, while the other eight run 20%. This means those two project managers are 16 times more effective than the other eight. This is a big reason for knowing your A players and embracing them!

I am guessing many of you are quite familiar with this concept, but if it’s new and you want to know more, a quick Google search will yield plenty of resources. Some consider this rule the best-kept secret in business, because those who harness it find the ability to propel themselves ahead of the competition.

Happy restoring!