Author: Richard Koch
ISBN: 978-1857883992
Pareto principle explained and applied to everyday life. A great read!
EXCERPTS
[I've read this book in paper form. Instead of the usual excerpts I am providing my notes and thoughts.]
The base premise of the book is universal applicability of the Pareto principle. The Pareto principle (also known as the 80/20 rule, the law of the vital few, or the principle of factor sparsity) states that, for many events, roughly 80% of the effects come from 20% of the causes.
Identify people/ activities that:
- make you most money,
- make you most losses,
- make you most happy,
- drain most of your energy,
- ...
Focus on there and disregard the rest. For example; the easiest to make more money is to increase business with existing top 20% of clients, to spend more time in existing 20% activities you enjoy the most etc.
It is better to be an expert in few areas than good in many.
Outsource as much as you can; only keep activities with the highest ROI - the activities you are good at/ enjoy the most.
Simplify your life.
Simple does not imply small!
Do the things that have the highest ROI. (ROI = return on investment. Define investment broadly - depending on instance include your time, energy etc.)
Solve problems one after the other, not simultaneously.
Quality usually beats quantity: work only when you can concentrate, work only on the things that matter (effectiveness!), proceed to other tasks only upon completion.
[Remember Joseph Stalin: Quantity has quality of its own. Especially when starting out.]
Focus your work on areas that lack experts -> high ROI.
Employ rather than be employed.
Don't mind the theory if it deviates from the practice.
If something doesn't work as planned, terminate it. It is better to retreate with small losses than stubbornly persist. The latter can lead to disaster.
Concentrate on one goal only.
When negotiation let the other party win on irrelevant points and only concentrate on important ones.
Remember: negotiations are always decided towards the end.
Find your competitive advantage.
Simple does not imply that it is easy.
You cannot save happiness for later. Enjoy every day.
Even when working within a company act like you work for yourself.
Carefully choose your partner and your obligations.
If you aren't happy, choose your career/ lifestyle/ partner etc.
Be unconventional and eccentric in how you use your time. Don't follow the herd!
Cancel unproductive obligations, even if you're expected to perform them.
Minimum effective dose; conserve your energy, assets etc. Train only as much as is needed for certain result etc.
If you like working, work 24/7.
Don't do something merely because people ask you to/ receive email/ phone call. Just say no or completely ignore the matter. But, do it if it is profitable or if you enjoy it.
Work for fun or for success.
In general, don't do:
- things merely because others expect them from you,
- things you don't enjoy,
- things you're not good at,
- things that are too predictable.
In general, do:
- things you've always wanted,
- things others tell you it's not possible,
- things that require you to be creative,
- things that you can later delegate to others,
- "now or never" things.
Apply the above principles and make other people adapt to you (and not the other way around).
Something big always comes from something small.
Succeed on your terms.
Turn your hobby into business. [What I realised years later the hard way. Keep at least some hobbies as hobbies. Otherwise you'll never be able to enjoy it. You'll always pursue monetary outcome.]
Find a niche and specialize.
Aim to have it all (career, family, free-time, friends, lifestyle etc.).
80/20 does not mean absence of hard word!
