It really is surprising how often a Pareto distribution--the “80/20 rule--appears in business life, or in life, generally. Basically, the theorem states that 80 percent of results come from 20 percent of the actions.
As one example, 80 percent of sales come from 20 percent of clients, or 80 percent of wealth is owned by 20 percent of the people.
Pareto distributions seem to occur widely in the natural world.
In customer service — 80 percent of your problems are going to come from 20 percent of your customers, and 80 percent of your profits are going to come from 20 percent of your customers
In management — 80 percent of your value is going to be created by 20 percent of your employees, and 80 percent of your problems are going to come from 20 percent of your employees (not necessarily the same 20 percent
In computer science — fixing 20 percent of your most common bugs will fix 80 percent of your errors and crashes
In mobile gaming — 80 percent of your in-game purchases are going to be made by 20 percent of your users
In website management — 80 percent of your traffic is going to come during 20 percent of your uptime,
and 80 percent of your traffic will route to 20 percent of your page
In construction — 80 percent of your injuries are going to come from 20 percent of your hazards
In sports — 80 percent of your wins are going to come from 20 percent of your competitors
or teams
In weight loss and muscle gain, 80 percent of your results are going to come from 20 percent of
your exercises
In user experience — 20 percent of the features of your product or service will be used by users
80 percent of the time
In customer service — 80 percent of your problems are going to come from 20 percent of your customers, and 80 percent of your profits are going to come from 20 percent of your customers
In management — 80 percent of your value is going to be created by 20 percent of your employees, and 80 percent of your problems are going to come from 20 percent of your employees (not necessarily the same 20 percent
In computer science — fixing 20 percent of your most common bugs will fix 80 percent of your errors and crashes
In mobile gaming — 80 percent of your in-game purchases are going to be made by 20 percent of your users
In website management — 80 percent of your traffic is going to come during 20 percent of your uptime,
and 80 percent of your traffic will route to 20 percent of your page
In construction — 80 percent of your injuries are going to come from 20 percent of your hazards
In sports — 80 percent of your wins are going to come from 20 percent of your competitors
or teams
In weight loss and muscle gain, 80 percent of your results are going to come from 20 percent of
your exercises
In user experience — 20 percent of the features of your product or service will be used by users
80 percent of the time
This analysis of the economics of automated vehicles for taxi service, versus conventional driven vehicles, also illustrates the Pareto distribution. Well over 80 percent of the impact comes from less than 20 percent of the vehicles in the fleet.
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