80-20 Rule The 80-20 rule, also known as the Pareto Principle | GOFERE BUSINESS TIPS 💰

80-20 Rule

The 80-20 rule, also known as the Pareto Principle, is an aphorism which asserts that 80% of outcomes (or outputs) result from 20% of all causes (or inputs) for any given event. In business, a goal of the 80-20 rule is to identify inputs that are potentially the most productive & make them the priority. For instance, once managers identify factors that are critical to their company's success, they should give those factors the most focus.

Although the 80-20 axiom is frequently used in business & economics, you can apply the concept to any field—such as wealth distribution, personal finance, spending habits, & even infidelity in personal relationships.

The 80-20 rule maintains that 80% of outcomes (outputs) come from 20% of causes (inputs).

In the 80-20 rule, you prioritize the 20% of factors that will produce the best results.

A principle of the 80-20 rule is to identify an entity's best assets & use them efficiently to create maximum value.

(Investopedia)

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