[ThinkBetter](https://thinkbetter.app/) → [Mental Models](https://thinkbetter.app/mental-models.md) → Pareto Principle

# Pareto Principle

aka the 80/20 rule, says that is common for roughly 80% of results come from 20% of the input/causes.

![Pareto Principle illustration](https://assets.thinkbetter.app/images/pareto_principle.png)

This principle was first identified by economist Vilfredo Pareto in 1906. He noticed something intriguing about wealth distribution in Italy: 80% of the land was owned by just 20% of the population. This observation led to the broader principle that in many areas of life, a relatively small proportion of inputs or efforts (about 20%) often contribute to a majority (roughly 80%) of the results or rewards. This principle isn't about percentage accuracy, but rather a guideline that highlights an often-observed imbalance between effort and result. For example, you might find that 20% of your daily tasks contribute to 80% of your productivity, or that 20% of your clothes are worn 80% of the time.It's a powerful insight that helps in focusing on the most effective areas of work, life, or social interaction.

## Example

**Business Sales**

Often, 80% of a company's sales come from 20% of its customers. By focusing on these key customers, businesses can maximize sales efficiency. Why? By nurturing these crucial relationships, businesses can capitalize on the most lucrative opportunities.

## In your professional life

**Apply the 80/20 Rule**

Identify and focus on the 20% of your tasks that produce 80% of your results to maximize productivity. As a sales representative, you might discover that personalized follow-ups with key accounts and targeted product demonstrations contribute most significantly to your sales figures. Prioritize these activities and streamline less impactful tasks like general email correspondence. This approach allows you to concentrate your efforts where they matter most, increasing your overall effectiveness and potentially boosting your sales performance.

## Go deeper in ThinkBetter

The ThinkBetter app has the full Pareto Principle deep-dive: more examples, a quiz to test yourself, audio narration, and a weekly path that builds these ideas into a habit.

- iOS: https://apps.apple.com/app/id6459831884
- Android: https://play.google.com/store/apps/details?id=io.ventureship.braintricks

### Related concepts

- [Law of Diminishing Returns](https://thinkbetter.app/mental-models/law-of-diminishing-returns.md)
- [Parkinson's Law](https://thinkbetter.app/mental-models/parkinsons-law.md)
- [All cognitive biases](https://thinkbetter.app/cognitive-biases.md)

Page: https://thinkbetter.app/mental-models/pareto-principle