Our guest post for today comes from Vince Cordic. On his site you’ll find plenty of great articles about internet marketing and self-improvement. Thanks for this fascinating look at the 80/20 Rule.
This is my first attempt at guest posting, so I hope I don’t disappoint. Thanks Ray for giving me the opportunity to share my thoughts with your readers, you’ve got a great blog here!
It’s a sad fact that most people who have every intention of making money online fail because they don’t take action…
Working online is a constant battle. You’re constantly bombarded with distractions everywhere you look. You’re just about to get some work done – but wait – “I’ll just watch this quick 2 minute video before I start working.” The next thing you know it’s 2 hours later, and you still haven’t done any work.
Work Smarter, Not Harder!
Making money online is not rocket science. In fact, almost anyone with some basic computer and reasoning skills can make money online. So what’s the difference between those who fail to make money online and those who succeed? The successful ones set a goal, and they only work on tasks that bring them closer to achieving their goal. That doesn’t mean they work harder or longer than you, and it doesn’t mean they know more than you either. It simply means they work smarter than you.
How do you work smarter?
We’re all limited by time. There are only so many hours in a day, only so many days in a year, and only so many years in a lifetime. So in order to work smarter, we have to make good use of our time. Making good use of your time means eliminating any unnecessary tasks, and only focusing on the most important tasks that bring you closer to your goal. Is watching that funny video your friend sent you going to help you reach your goal? I doubt it. Neither is reading everything you can about internet marketing without actually following any of the advice.
Introducing the 80/20 rule…
Early in the 20th century, an Italian economist named Vilfredo Pareto observed that 80% of the income in Italy was received by 20% of the people. This has come to be known as the 80/20 rule or, “The Law of Vital Few and Trivial Many”. The 80/20 rule applies to much more than just income ratios. In fact, it’s been shown to hold true in most scenarios.
Here are some classic examples of the 80/20 rule in action:
20% of your efforts will account for 80% of your results
20% of your marketing efforts will account for 80% of your sales or traffic
20% of your products will account for 80% of your sales
20% of your sales will account for 80% of your profits
80% of your customer support emails will come from 20% of your customers
20% of drivers account for 80% of accidents
20% of a carpeted area will have 80% of the wear and tear
20% of the clothes you own will be worn 80% of the time
Take a stock broker firm for example…
A stock broker intern is assigned to call 100 people. Out of the 100 people he called, he was able to close a deal for 30 of them (he’s a closing machine). Of those 30 people, 10 of them amount to $20,000 in profits. The other 20 people amount to $80,000 in profits, for a total of $100,000 in profits. So, 80% of the profits came from 20% of the people, the classic 80/20 ratio.
How does this apply to getting more done each day?
Remember, you want to work smarter, not harder; the 80/20 rule tells you 20% of your efforts will account for 80% of your results. So the key is to identify the tasks that fall into the upper 20% and focus your efforts on them. Before you can identify your most important tasks, though, you must have a goal in mind. If your goal is to “find and watch funny videos online,” then watching a funny video will be one of the tasks in your upper 20%. On the other hand, if your goal is to “setup and run a successful website that sells pet toys,” then watching a funny video definitely isn’t going to help you, and falls into the bottom 80%.
How can you use the 80/20 rule to get more done?
First, you must set a goal and write it down. Your goal might be something like “Setup an online pet store, and achieve $1000 a month in profits by December 31st, 2007.”
Next, spend a few days analyzing all the tasks you perform online and write them all down. This should include everything from writing an article for your pet store, to watching the latest videos posted on Digg.
After you have a list of activities and tasks, start breaking them down. Make a separate list that only includes the tasks that will bring you closer to your goal. These are known as “the vital few.” If you want, you can even prioritize this list, so that the most important tasks are listed at the top.
Now that you’ve established a list of the most important tasks, you should use this list as your starting point each day. Every morning, review the list and use it to decide what you want to accomplish today.
In summary, you should…
- Set a goal.
- Identify all of the tasks that will bring you closer to your goal.
- Focus on the tasks that will bring closer to your goal.
Does this mean I can’t have any fun?
Of course not. It does however reinforce the age-old paradigm of “Work Before Play.” In fact, I commonly use “fun” as motivation to get my work done. I’ll say to myself, “Just get this done and then you can go outside and have some fun.” That way I have something to look forward to when I finish my work, and I save myself from getting distracted.
Just as important as getting your work done is spending time doing the things you enjoy. It’s important to balance your life and your work. By working smarter you’ll have more time for both.
To practice what I preach, now that I’m done writing this post I’m going to take the boat out on the lake and do some fishing. Adios!