Pareto for anyone

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Pareto Norsk

Pareto Norsk (Photo credit: Wikipedia)

In yesterday’s post (http://is.gd/YYFBbS) I gave you three unconventional ways you can use to overcome laziness. While these tips are fun and can work, there are infinite other, more serious ways to get the ball rolling and have you doing what you must, but don’t feel like doing.

One such ideas is known as the Pareto Principle. This is basically the 80/20 concept, and it states that 80% of your problems are caused by 20% of the reasons, or that 80% of your income is produced by 20% of your efforts, or that 80% of your weight gain is caused by 20% of the foods you eat, so on and so forth.

This Pareto principle is very useful in Operations Management, in fact, there is an entire science to it, charts, tables and formulas behind it, and it is engrained in the Lean Process improvement philosophy all over the world. And while it is not a precise concept, the general idea is almost always true.

So in order to improve efficiency (are you getting bored yet? Hang in there), businesses survey what are the causes of defect, delay, problems etc., and select the top 20%, then they can narrow these down to find the causes for those 20% again and when they are done, they have found a very specific problem to attack.

Let me give you an example: Work in my office is getting piled up, I have stacks of paper all over my desk and I do not know where to start. There are invoices to mail, cash receipts to apply, checks to cut, reports to generate etc. So instead of rolling up my sleeves and getting to work on just any of these things, I decide I will make my tuition expenses worth their ridiculous fees, and conduct a Pareto Analysis (am I the only one who thinks of ice cream when reading the word Pareto?). So I start looking at the causes for my work lagging. I list these and tally up the number of causes each time these are repeated.

· I spend time with people who stop to chat at my office

· I am spending too much time on menial tasks

· Computer is crashing or not working correctly

· I spend too much time correcting someone else’s mistakes

· I am absent or away from the office too often

Once I have listed these, I start counting the number of times each one of these happens in a day, week or whatever cycle you want to measure.

I then list these by most frequent, to least, and if you want to get fancy, calculate the percentage of times these occur as part of the total number of problems.

Once you have the top 20%, you can then conduct another Pareto (vanilla, strawberry or chocolate anyone?) analysis of what causes are behind these 20% and attack the top 20%.

Inevitably, you will see an improvement. This improvement will be exponential (will grow more than 20%) because as you have more available time, you then move on to attack the next top cause in your list, and so on.

As you can see, this Pareto principle can be adapted to any circumstance. Starting my blog, I decided to attack the causes that kept me from posting frequently, the top one was finding the best time to write, so I found a solution for that cause and that cleared the way to work on other causes.

Of course, if this seems like too much work, or overly complicated, you can always go back to my post from yesterday and follow my other, more unconventional methods http://is.gd/YYFBbS.

 

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