Site icon Constance Vork

Commit to the 80/20 Principle

Last week, we looked at the first of Gary Keller’s Six Personal Perspectives – Commit to Self-Mastery. 

This week, let’s go to the second Perspective, which is: Commit to the 80/20 Principle.

If you’re a reader of Tim Ferriss, this concept will ring a bell to you.

The 80/20 Principle, also called the Pareto Principle, simply states that 20 percent of our inputs are responsible for 80 percent of our results, whether those be positive or negative. This concept is named after Vilfredo Pareto, who discovered in the late 1800s that 80 percent of the land was controlled by 20 percent of the landowners. He also observed that 20 percent of the pea plants in his garden yielded 80% of the pea pods.

Other common examples of this law are:

A key thing to keep in mind is that the distribution may not be precisely 80/20, which is why this principle is also sometimes call the law of the vital few and the trivial many. It may be 85/15, 90/10, or even as dramatic as 99/1. The point is that not all things matter equally.

At Keller Williams, we focus on the positive angle of this law, which is the identification of the 20 percent activities that yield 80 percent of our results in business. For real estate, there are five things:

Research of the highest-producing agents across the country (and across brokerage lines) have shown that this 20 percent of real estate agent activities are responsible for 80 percent of the agents’ closed business. You’ll note that things like filling out forms, making flyers, showing houses and designing marketing campaigns are not listed in the collection above. Are they necessary in our job? Absolutely. Yet they represent the so-called 80 percent activities, which, if we track them, will yield 20 percent (or less) of our total business at the end of the day.

Tim Ferriss, author of the Four-Hour Workweek (and several other books) as well as host of the Tim Ferriss show podcast, often takes an approach from the negative side. Specifically, he’s written about performing what he calls an 80/20 analysis on your life, asking the question: what are the 20 percent of things that are responsible for 80 percent of my aggravation or annoyance?

In the Four-Hour Workweek, Ferriss writes about eliminating the 20 percent of his business contracts that represented 80 percent of his headaches and complaints.

Having been a Realtor at the time I read this, it struck me deeply. I had a client or two that were very challenging, taking up a lot of time and mental capacity, and it had never occurred to me that perhaps I didn’t have to work with them. And that perhaps in NOT working with them, space in my life would be freed up to work with more clients who were a great fit with me.

Ultimately, when you look at people who succeed at a high level in life, regardless of profession or pursuit, you will find that they have identified and separated their own vital few from their trivial many. What this really means for us is that not all things matter equally in life. Indeed, something matter MUCH more than others.

So what are YOUR vital few, and are you committed to focus on them first?

 

 

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