Category: SM2: The 80/20 Principle

Do you want to grow your business up to 16 TIMES FASTER and make your life a whole lot less busy? Then SM2: The 80/20 Principle is for you.

Got your attention?

The 80/20 Principle is one of the fundamental rules contributing to optimisation of your business. This optimisation will then lead to growth and productivity with the least input of your time and resources.

Richard Koch lists 10 areas where the 80/20 Principle can be applied in a business. See the first 10 below. We have added others to the list.

1. Strategy
2. Quality
3. Cost reduction and service improvement
4. Marketing
5. Sales
6. Information technology
7. Decision making and analysis
8. Inventory management
9. Project management
10. Negotiation
11. Staffing
12. Time Management

Taking it further, the 80/20 Principle asserts that:

A minority of causes, inputs or effort
Usually lead to a majority of the results, outputs or rewards.

Literally, this means that 80 percent of what you achieve in your job comes from 20 percent of the time spent.
This implies that:
• 80% of your sales will come from 20% of your products.
• 80% of your time produces 20% of your gain.
• 20% of your time produces 80% of your gain.
• 80% of your problems will come from 20% of the people.

The 80/20 Principle is widely referred to throughout 12Faces.

Learn from 80/20 Rule Menu

The Amazing 80/20 Rule has the power to grow your business up to 16 TIMES FASTER and make your life a whole lot less busy and complicated. Got your attention? Work through this Menu to learn some of the best lessons 12Faces has to offer. Yellow Belt

SM2.3 80/20 and the Theory of Constraints (TOC)

This is 12Faces’s equivalent of Godzilla meets the Hulk! In our language it is the mixing of the 80/20 Rule, which promises up to 16x growth and the Theory of Constraints (TOC) approach, which describes the most liberating aspect of your production line.

SM2.1 The Amazing 80/20 Rule Tool

Would you be interested in knowing a way to increase your productivity by 16 times!

Got your attention? The following material gives an insight into how this is possible.

SM2.2 80/20 Problem Solving

It is very common in business to be faced with a dilemma where you have a large number of alternative solutions to a problem. It is unclear as to which are the major contributors to the problem, or the best way to go, to help you solve the problem.

SM2.4 80/20 Decision Making

Smaller business operators are constantly making decisions – large and small. The 80/20 Rule suggests some tools that might help with faster, better, smarter decisions.

SM2.0 80/20 Principle – 16 Times More Productive

Introducing the 80/20 Principal The 80/20 Principle asserts that a minority of causes, inputs or effort usually lead to a majority of the results, outputs or rewards. Taken literally, this means that 80 percent of what you achieve in your job comes from 20 percent of the time spent. This implies that: 80% of your […]

SM2.6 80/20 Business Analysis

We talk about the 80/20 Rule a lot in 12Faces. This article looks specifically at how to analyse many parts of your business with 80/20 to rapidly improve productivity. It is a mix of Yellow and Blue Belt

SM2.8 80/20 Maestro

It is one thing to see the benefits of the 80/20 Rule and quite another to have the discipline to implement it. Read on to find out how to exploit this tool. Yellow Belt

SM2.9 80/20 Staffing

Labour costs are typically 50-70% of your operating costs so anything you can do to improve labour productivity is a good thing. The 80/20 Rule can be applied to the issues around staffing so that your business can operate as effectively as possible. Yellow Belt

SM2.11 80/20 Inventory Management

If inventory is something you have to manage in your business, the The Amazing 80/20 Rule Tool can have a powerful impact on Profit and Cashflow.

This is a Yellow Belt article.