{MMYH Ep. 104} Using The Pareto Principle In Your Business

by Amanda Abella  - October 22, 2019

One of my favorite productivity hacks has been the Pareto principle. And basically, the Pareto principle is the idea that 80% of the effects that happen come from 20% of the causes. It’s basically like 80% of results come from like 20% of your efforts.

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The Pareto Principle

And the thing is that a lot of people have it backward. They’re constantly putting more on their plates, but they’re not really seeing results and it’s because they haven’t yet determined what the actions are that lead to the most results.

So I’ll give you a couple of examples. In my company, what brings the most money in the door is sales. So what does that mean? It means I spend most of my time on marketing and sales. That’s it. Period. Marketing gets the leads in. Sales get the money in the door. 

Now within that, of course, my team looks for data and we’ll ask, “Okay, well what’s the thing that’s selling the most for us? Let’s double down on that.” Or, “What social media channel is doing really well for us? Let’s double down on that”. So, you don’t have all the answers right away, but that’s why it’s so important to look at data as you go.

Figure Out How You Could Use The Pareto Principle

I would like you to try and guess the easiest way to get money in your business. If you need money now, where do you go find it? Who do you call? Who do you email? So you hit up people who’ve already paid you. They already paid you once, they’d be way more likely to pay you again, especially if you got them really great results. So that’s still an example of Pareto principle because it’s like 20% of the effort. So here’s like 20% of people. All these people have already paid me. So that’s going to get me 80% of results. That’s gonna get me a lot further a lot faster because they are already predispositioned to want to work with me. 

So in reality, getting results is actually really simple. A lot of it comes down to really basic things that you do on a very consistent basis. That would be your 20% and you’ll notice that the 20% is pretty basic. It’s not that complicated. And then that’s what leads to the most results. I think we just live in a society that tends to overcomplicate things. 

And if you don’t get it right away, don’t worry. I feel like it really took me years to really figure this one out, but it was because I had to pay attention. I had to really look at data and ask what was working and what wasn’t working. So don’t be too hard on yourself. You might be in that stage where you first have to get the clarity and then you can actually practice the Pareto principle. 

Resources that are mentioned or add value to this episode:

{MMYH Ep. 105} Why You Need Clarity In Your Business

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