The 80/20 Rule

The first time I heard about the 80/20 rule I was taking a economics course at the University of Utah. I don’t recall the context of the discussion but it seemed reasonable.

80/20 Rule = 20% of your efforts produce 80% of the results

You may have heard it expressed as:

People wear 20% of their wardrobe 80% of the time

80% of income is distributed to wealthiest 20%

20% of your sales force produces 80% of sales

Users spend 80% of their time using 20% of a product’s features

The first time I recognized this rule in action was the time I was in charge of the Microsoft Project partner program. I spent months analyzing over 150 partners who built add-ons or complimentary products to Project. What I found was that of those 150 partners, about 15 were responsible for driving over 80% of partner related revenue.

I decided to cut back the number of partners in the program to 90 and focus my efforts on the top 15. In theory this seemed like the right thing to do, but in practice, I only had time to work closely with 5 partners. wire

Lately I’ve wondered if the 80/20 rule can be applied to my group of technicians. I think back 6 years to how I managed 40 people and it’s easy to see where I failed. Of those 40, maybe 10 were top performers, 25 were good techs, and 5 were subpar performers. I assumed the top 5 could manage themselves and didn’t need much guidance to succeed. This freed up time to spend elsewhere.

As their manager I felt it was my responsibility to fix the problems. As a result I spent 80% of my time with bottom feeder 5. I don’t believe I was a total failure in this approach but I didn’t have much success helping them move into the middle tier, and not one ever raised his game to join the top tier.

Fast forward to today where I manage the same group of technicians. The group is half the size as before due to how we’ve structured our teams. This time around I’ve taken a different approach. I now spend 80% of my time working with my top 5 techs.

But I’ve found that my best technicians look for ways to improve our company. They are the most confident and thus willing to challenge my suggestions. They listen to our customers and want to improve our products. They drive at least 80% of the new business opportunities. They can manage themselves but still need someone who can push ideas through the organization.

The biggest benefit I’ve noticed from this approach is the top 5 set the example for rest of the group. If the bar is set high, the group will police itself. I still spend time with those who need daily guidance but not at the expense of my most valuable techs.

At the end of each week I ask myself: Did I spend more time managing problem techs or more time leading the best ones?

I still fall short. But my goal is to move from spending the greater part of the week solving problems to leading the top performing members of the team. The less time I spend fixing problems, they more time I can devote to growing our business.

Photo by Betsy Martian

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2 thoughts on “The 80/20 Rule

  1. Brett. You are really something. This is GREAT! I am so glad I actually clicked the link on the facebook thing. I can definitely say this works in any job structure, mine being pharmacy, for pharmacists/ technicians…and would be willing to stretch it to my husbands job of the surgery department at the hospital as well. Julie Horsley McCahill

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