You’re probably familiar with the Pareto principle, also known as the 80–20 rule. This principle explains that roughly 80% of the effects in business or life come from 20% of the causes. The question you might ask yourself is, “How can I better control the 20% that results in the 80% of my results?” Here are some thoughts on that.
Five Ways the Pareto Principle Impacts Your Business
- 20% of your customers result in 80% of your revenue,Ask yourself how you cantake better care of those customers, not only to retain but to grow that huge part of your business?
- 20% of your processes cause 80% of your customer complaints. Figure out which processes are causing a kink in your system and fix them. Today.
- 20% of your employees cause 80% of your employee hassles. You already know who those employees are. And the rest of your staff does as well. Imagine what it would be like to eliminate those problems. Then do something about it.
- 20% of your salespeople drive 80% of your sales. Consider what you’re doing to keep them on your team rather than your competitor’s. Should you be doing more?
- 20% of your vendors result in 80% of your vendor problems. Don’t just keep using an existing vendor because it’s simpler not to switch. Or because they have the lowest price. Consider the real cost in dealing with a vendor who causes problems for your staff or customers.
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