Vilfredo Federico Damaso Pareto was born 165 years ago on July 15, 1848. As an economist Pareto established that 80% of the land in Italy was owned by 20% of the population. While gardening he later observed that 20% of the pea pods in his garden yielded 80% of the harvested peas. And thus was born a theory that has stood the test of time and scrutiny. The Pareto Principle or the 80:20 Rule has proven valid in a number of other areas:
- 80% of sales come from 20% of your customers
- 20% of your products account for 80% of your sales
- A small percentage of the population generate the largest health care costs
- Earnings come from 20% of your investments
- 80% of this blog’s traffic is attributed to 20% of the postings
(Actually 28% of the posts (19 of 69) account for 79% of the last 30 days' worth of traffic.)
