The Pareto Principle

See the Wiki Link The Pareto Principle for further details.

"The Pareto principle (also known as the 80–20 rule, the law of the vital few, and the principle of factor sparsity) states that, for many events, roughly 80% of the effects come from 20% of the causes.[1][2]

Business-management consultant Joseph M. Juran suggested the principle and named it after Italian economist Vilfredo Pareto, who observed in 1906 that 80% of the land in Italy was owned by 20% of the population; he developed the principle by observing that 20% of the pea pods in his garden contained 80% of the peas.[2]

It is a common rule of thumb in business; e.g., "80% of your sales come from 20% of your clients". Mathematically, where something is shared among a sufficiently large set of participants, there must be a number k between 50 and 100 such that "k% is taken by (100 − k)% of the participants". The number k may vary from 50 (in the case of equal distribution, i.e. 100% of the population have equal shares) to nearly 100 (when a tiny number of participants account for almost all of the resource). There is nothing special about the number 80% mathematically, but many real systems have k somewhere around this region of intermediate imbalance in distribution.[3]

The Pareto principle is only tangentially related to Pareto efficiency, which was also introduced by the same economist. Pareto developed both concepts in the context of the distribution of income and wealth among the population."

Food for Thoughts - Business Books

Here is a recommendation by Dave Kerpen, 9 Business Books That Will Change Your Life (click).

The short list is:

1) What Color is Your Parachute? A Practical Manual for Job-Hunters and Career Seekers by Richard Bolles

2) Permission Marketing: Turning Strangers Into Friends & Friends Into Customers by Seth Godin

3) The Tipping Point: How Little Things Can Make a Big Difference by Malcolm Gladwell

4) Good to Great: Why Some Companies Make the Leap - and Others Don't by Jim Collins

5) Mastering the Rockefeller Habits: What You Must Do to Increase The Value of Your Growing Firm by Verne Harnish

6) The E-Myth: Why Most Small Businesses Don't Work, and What to Do About It by Michael Gerber

7) Built to Sell: Creating a Business That Can Thrive Without You by John Warrilow

8) Rework by Jason Fried and David Heinemeier Hansson

9) The Three Big Questions for a Frantic Family: A Leadership Fable About Restoring Sanity to The Most Important Organization in Your Life by Patrick Lencioni

I haven't read any of the above and can't validate the claims of the author. Will look into it and hope one of them will hit the spot and change my business life, for good.

Feel It

The following is a note I sent to a mentee of mine a few weeks ago. She has educational background in broadcasting and obviously her career is geared towards the creative side of her.

"Last night, as I was flipping through TV and getting a mental shutdown, I happened upon a program called "What Not to Wear" on TLC.

Long story short, this episode is about the makeover of a brainy 23-year old, who is applying for a PhD degree in physics, while still dressed like a teenager, with a big Pi, her favorite number on her T-shirt. As the fashion gurus kept putting forward new ideas, every time without failing, her analytical brain kicked in and her thought process went, "well, the color... the style.... the cut...how not me....."

Finally, the designers said, "Don't think too much. Feel it."

I think this applies to you too. You are in a different field. There is no magic potion, silver bullet, the E = mc2 to be discovered. As I mentioned, the creative thinking requires the leap of faith. "Don't think too much. Feel it." For that, I think another post in my blog may be helpful: Steve Jobs Standford Commencement speech. Jobs shared his life lessons, including connecting the dots.

I can use an analogy. It's very much like dating. You can rationalize it, match.com it, but at the end of the day, you just need to go for it, trust your hunch, be ready to fail and start again, keep at it, till you find your prince charming."

This relates to the previous post of Paralysis by Analysis. It separates entrepreneurs from ordinary work-bees.

Entrepreneurs:

- have a vision or a great idea
- turn it into actions
- are not afraid to make decisions
- are willing to fail
- are not taking "impossible" as an answer
- are looking for a solution instead of backing away from a problem

Go get them!

Paralysis By Analysis

"There was little room for fear and doubt in what he did. There should be caution and a keen eye to detail, but fear and doubt could incapacitate. He could stand up here all night thinking up excuses not to proceed. Stan Hurley, the tough SOB who had trained him, had warned him about the pitfalls of paralysis by analysis." - Mitch Rapp in "Kill Shot" by Vince Flynn.

"Paralysis by analysis." I like that.

How so to life in general! We often think too much and get incapacitated by all the baggages and what-ifs.

Get rid of the clutters, lighten up, keep it simple and ....

"Just do it!" - Nike