The 80/20 Principle: The Secret of Achieving More With Less (21 page)

Yet the 80/20 Principle is a principle of life, not of business. It originated in academic economics. It works in business because it reflects the way the world works, not because there is something about business that particularly fits the 80/20 Principle. In any situation, the 80/20 Principle is either true or not true; whenever it has been tested, inside or outside the business arena, it works equally well. It is just that the principle has been tested far more often within the confines of business enterprise.

It is high time to liberate the power of the 80/20 Principle and use it beyond business. Business and the capitalist system are exciting and important parts of life, but they are basically procedures, the envelope of life, but not its contents. The most precious part of life lies in the inner and outer lives of individuals, in personal relationships and in the interactions and values of society.

Part Three attempts to relate the 80/20 Principle to our own lives, to achievement, and to happiness. Part Four explores how the 80/20 Principle is intrinsic to the advance of civilization, to progress in society. Parts Three and Four are more speculative and less proven than what we have covered thus far, but are potentially even more important. The reader is asked to collaborate in the expedition to the unknown that we are about to begin.

PART
THREE

WORK LESS, EARN AND ENJOY MORE

9

BEING FREE

The 80/20 Principle, like the truth, can make you free. You can work less. At the same time, you can earn and enjoy more. The only price is that you need to do some serious 80/20 Thinking. This will yield a few key insights that, if you act on them, could change your life.

And this can happen without the baggage of religion, ideology, or any other externally imposed view. The beauty of 80/20 Thinking is that it is pragmatic and internally generated, centered around the individual.

There is a slight catch.
You
must do the thinking. You must “editionize” and elaborate what is written here for your own purposes. But this shouldn’t be too difficult.

The insights from 80/20 Thinking are few in number but very powerful. Not all of them will apply to every reader, so if you find your experience different, skip along until you meet the next insight that does resonate with your own position.

BECOME AN 80/20 THINKER, STARTING WITH YOUR OWN LIFE

My ambition is not just to serve up insights from 80/20 Thinking and have you tailor them to your own life. I am actually much more ambitious than that. I want you to lock on to the nature of 80/20 Thinking so that you can develop your own insights, both particular and general, which have not crossed my mind. I want to enlist you in the army of 80/20 thinkers, multiplying the amount of 80/20 Thinking let loose in the world.

The common attributes of 80/20 Thinking are that it is reflective, unconventional, hedonistic, strategic, and nonlinear; and that it combines extreme ambition (in the sense of wanting to change things for the better) with a relaxed and confident manner. It is also on the constant lookout for 80/20-type hypotheses and insights. Some explanation of these areas will provide a pointer to how to conduct 80/20 Thinking so you will know when you are on the right track.

80/20 THINKING IS REFLECTIVE

The objective of 80/20 Thinking is to generate action which will make sharp improvements in your life and that of others. Action of the type desired requires unusual insight. Insight requires reflection and introspection. Insight sometimes requires data gathering, and we will indulge gently in a little of this as it relates to your own life. Often, insight can be generated purely by reflection, without the explicit need for information. The brain already has much more information than we can imagine.

80/20 Thinking is different from the type of thinking which prevails today. The latter is usually rushed, opportunistic, linear (for example,
x
is good or bad, what caused it?), and incrementalist. The predominant type of thinking in today’s world is very closely allied to immediate action and consequently is greatly impoverished. Action drives out thought. Our objective, as 80/20 thinkers, is to leave action behind, do some quiet thinking, mine a few small pieces of precious insight, and then act: selectively, on a few objectives and a narrow front, decisively and impressively, to produce terrific results with as little energy and as few resources as possible.

80/20 THINKING IS UNCONVENTIONAL

80/20 Thinking discovers where conventional wisdom is wrong, as it generally is. Progress springs from identifying the waste and suboptimality inherent in life, starting with our daily lives, and then doing something about it. Conventional wisdom is no help here, except as a counter indicator. It is conventional wisdom that leads to the waste and suboptimality in the first place. The power of the 80/20 Principle lies in doing things differently based on unconventional wisdom. This requires you to work out why most other people are doing things wrongly or to a fraction of their potential. If your insights are not unconventional, you are not thinking 80/20.

80/20 THINKING IS HEDONISTIC

80/20 Thinking seeks pleasure. It believes that life is meant to be enjoyed. It believes that most achievement is a by-product of interest, joy, and the desire for future happiness. This may not seem controversial, but most people do not do the simple things that would be conducive to their happiness, even when they know what they are.

Most people fall into one or more of the following traps. They spend a lot of time with people they do not much like. They do jobs they are not enthusiastic about. They use up most of their “free time” (incidentally an anti-hedonistic concept) on activities they do not greatly enjoy. The reverse is also true. They do not spend most time with the people they like most; they do not pursue the career they would most like; and they do not use most of their free time on the activities they enjoy most. They are not optimists, and even those who are optimists do not plan carefully to make their future lives better.

All this is curious. One could say that it is the triumph of experience over hope, except that “experience” is a self-created construct that usually owes more to our perception of external reality than to objective external reality itself. It would be better to say that it is the triumph of guilt over joy, of genetics over intelligence, or predestination over choice, and, in a very real sense, of death over life.

“Hedonism” is often held to imply selfishness, a disregard for others, and a lack of ambition. All this is a smear. Hedonism is in fact a necessary condition for helping others and for achievement. It is very difficult, and always wasteful, to achieve something worthwhile without enjoying it. If more people were hedonistic, the world would be a better and, in all senses, a richer place.

80/20 THINKING BELIEVES IN PROGRESS

There has been no consensus for the past 3,000 years on whether progress exists, whether the history of the universe and of mankind demonstrates a jagged upward path or something less hopeful. Against the idea of progress are Hesiod (around 800
B.C.
), Plato (428–348
B.C.
), Aristotle (384–322
B.C.
), Seneca (4
B.C.
–
A.D.
54), Horace (65–8
B.C.
), St. Augustine (
A.D.
354–430), and most living philosophers and scientists. In favor of the idea of progress stand nearly all of the Enlightenment figures of the late seventeenth century and eighteenth century, such as Fontenelle and Condorcet, and a majority of nineteenth-century thinkers and scientists, including Darwin and Marx. Team captain for progress must be Edward Gibbon (1737–94), the oddball historian, who wrote in
The Decline and Fall of the Roman Empire:

We cannot be certain to what height the human species may aspire in their advance toward perfection…We may therefore safely acquiesce in the pleasing conclusion that every age of the world has increased, and still increases, the real wealth, the happiness, the knowledge, and perhaps the virtue, of the human race.

Nowadays, of course, the evidence against progress is much stronger than in Gibbon’s day. But so too is the evidence for progress. The debate can never be resolved empirically. Belief in progress has to be an act of faith. Progress is a duty.
¹
If we did not believe in the possibility of progress, we could never change the world for the better. Business understands this. On the whole, business, in alliance with science, has provided the greatest evidence for progress. Just as we have discovered that natural resources are not inexhaustible, business and science have come along and supplied new dimensions of unnatural inexhaustibility: economic space, the microchip, new enabling technologies.
²
But to be of greatest benefit, progress should not be confined to the worlds of science, technology, and business. We need to apply progress to the quality of our own lives, individually and collectively.

80/20 Thinking is inherently optimistic because, paradoxically, it reveals a state of affairs that is seriously below what it should be. Only 20 percent of resources really matter in terms of achievement. The rest, the large majority, are marking time, making token contributions to the overall effort. Therefore, give more power to the 20 percent, get the 80 percent up to a reasonable level, and you can multiply the output. Progress takes you to a new and much higher level. But, even at this level, there will still typically be an 80/20 distribution of outputs/inputs. So you can progress again to a much higher level.

The progress of business and science vindicates the 80/20 Principle. Construct a huge computer that can make calculations several times faster than any previous machine. Demand that the computer be made smaller, faster, and cheaper, several times smaller, faster, and cheaper. Repeat the process. Repeat it again. There is no end in sight to such progress. Now apply the same principle to other provinces of life. If we believe in progress, the 80/20 Principle can help us to realize it. We may even end up proving Edward Gibbon right: real wealth, happiness, knowledge, and perhaps virtue can be constantly increased.

80/20 THINKING IS STRATEGIC

To be strategic is to concentrate on what is important, on those few objectives that can give us a comparative advantage, on what is important to us rather than others; and to plan and execute the resulting plan with determination and steadfastness.

80/20 THINKING IS NONLINEAR

Traditional thinking is encased within a powerful but sometimes inaccurate and destructive mental model. It is linear. It believes that
x
leads to
y,
that
y
causes
z,
and that
b
is the inevitable consequence of
a.
You made me unhappy because you were late. My poor schooling led to my dead-end job. I have been successful because I am very clever. Hitler caused the Second World War. My firm cannot grow because the industry is declining. Unemployment is the price we pay for low inflation. High taxes are necessary if we want to look after the poor, the sick, and the old. And so on.

All of these are examples of linear thinking. Linear thinking is attractive because it is simple, cut and dried. The trouble is that it is a poor description of the world and an even worse preparation for changing it. Scientists and historians have long ago abandoned linear thinking. Why should you cling to it?

80/20 Thinking offers you a life raft. Nothing flows from one simple cause. Nothing is inevitable. Nothing is ever in equilibrium or unchangeable. No undesired state of affairs need endure. Nothing desirable need be unobtainable. Few people understand what is really causing anything, good or bad. Causes may be very influential without being particularly noticeable or even (yet) very extensive. The balance of circumstances can be shifted in a major way by a minor action. Only a few decisions really matter. Those that do, matter a great deal. Choice can always be exercised.

80/20 Thinking escapes from the linear-logic trap by appealing to experience, introspection, and imagination. If you are unhappy, do not worry about the proximate cause. Think about the times you have been happy and maneuver yourself into similar situations. If your career is going nowhere, do not tinker around at the edges seeking incremental improvements: a bigger office, a more expensive car, a grander-sounding title, fewer working hours, a more understanding boss. Think about the few, most important achievements that are yours in your whole life and seek more of the same, if necessary switching jobs or even careers. Do not look for causes, especially not for causes of failure. Imagine and then create the circumstances that will make you both happy and productive.

80/20 THINKING COMBINES EXTREME AMBITION WITH A RELAXED AND CONFIDENT MANNER

We have been conditioned to think that high ambition must go with thrusting hyperactivity, long hours, ruthlessness, the sacrifice both of self and others to the cause, and extreme busyness. In short, the rat race. We pay dearly for this association of ideas. The combination is neither desirable nor necessary.