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80-20 Rule (Pareto Principle)

Author: guiferviz

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When I was at school, I used to tell my mother: “If I study two hours I can reach an 8 grade (8 over 10), but I need to study 10 hours or more to get a maximum score, so it’s not worth reaching that level of perfection”. I was experiencing something that has a name: the 80-20 rule.

The 80-20 Rule, also known as the Pareto Principle, states that roughly 80% of outcomes come from 20% of causes. Named after Italian economist Vilfredo Pareto, who observed in 1896 that 80% of Italy’s land was owned by 20% of the population, this principle has been found to apply across countless domains. For example, in a business context, 80% of revenue often comes from 20% of clients.

Practical Implications

Understanding the Pareto Principle helps with prioritization. We need to focus on the 20% of activities that yield 80% of results. Sometimes is difficult to know when “good enough” is actually optimal.

  • 1 Percent Rule Of The Internet: An even more extreme distribution observed in online communities, where only 1% of users create content while 99% consume