I am inspired this week by something my Tai Chi instructor said in the context of learning forms – a series of complex Tai Chi movements. Rather like skiing, just when you think you have mastered them, you realise how much more you have to learn. He advised that in order to do 80% right you must excel at 20%. In other words, concentrating on the very very basic initial moves until they are absolutely mastered will improve your performance of the whole form. In very traditional Chinese teaching of Tai Chi especially as a martial art the master or sensei would not permit their pupils to move to the next stage or movement until they had completely mastered the first.
You will notice in the title that I have used words and figures. In contracts lawyers generally do this in setting out key financial information on, for example, limits of liability. Why worry about such a small point? The answer is because there have been occasions when say a zero has been missed off a number with dire consequences. A court MAY correct this if there is an obvious mistake, but that would take time and money. There is far less likely to be an error in a written expression as opposed to a numeric one. This precision and focus on small things will or at least should flow through into all other drafting.
As is often the case in writing this blog I seem to have come across something here that is not only well documented, but is an accepted principle. See, for example, this article The 80-20 Rule (aka Pareto Principle): What It Is, How It Works which describes the 80-20 rule as “The 80-20 rule, also known as the Pareto Principle, is a familiar saying that asserts that 80% of outcomes (or outputs) result from 20% of all causes (or inputs) for any given event.” This is not a new concept: “It was introduced in 1906 by Italian economist Vilfredo Pareto, who is best known for the concepts of Pareto efficiency. Pareto noticed that 20% of the pea pods in his garden were responsible for 80% of the peas. Pareto expanded this principle to macroeconomics by showing that 80% of the wealth in Italy was owned by 20% of the population.” The key takeaways include:
Now I come to think about it, I have been applying this principle for a long time without fully appreciating that this is what I was doing. In private practice for example we recognised that most of our new business was likely to come from our top 20% of existing clients and focused our marketing efforts on them. This Forbes article Pareto Principle: How To Use It To Dramatically Grow Your Business acknowledges this and says you can take it a stage further. It cites Perry Marshall who in his book 80/20 Sales and Marketing found that “within that initial 20%, the 80/20 rule also exists. Meaning that the top 20% of the top 20% of your customers (or the top 4% overall) represent 64% of your sales”.
This principle applies equally well to how we manage our tasks in a professional practice and organise our time most effectively. This enables us in these complex and busy times to work more efficiently and incidentally reduce the stress of a hard working professional life. See this blog Managing Your Time And Practice Using The 80/20 Rulewhich comments “The 80/20 Rule is about optimizing your time. It is about focusing on the important 20% as a way to save time and maximize effort. Determine what types of tasks in your law practice produce the best results for clients and your business and focus your attention on those.” It recommends:
So my proposition here is that this principle applies not only to the growth of professional practices and businesses generally, but also to the way we practice in industry and private firms. I started with the drafting example, and this clearly extends to time management. It also can apply to other professional activities such as research – see, for example, this blog The 80/20 Rule for Legal Research which determines that “out of all the searches you do and sources you read, only about 20 percent of them will appear directly in—will be cited in—your final work product.”
As the British consultant Richard Koch said in his book The 80/20 Principle: Achieve More with Less:
“Not all inputs are equal; some inputs are far more important and influential than others”.
“The best way to deal with information overload is to focus on the vital few and ignore the trivial many.”
“The goal is not to do more, but to do less and achieve more.”
You will notice in the title that I have used words and figures. In contracts lawyers generally do this in setting out key financial information on, for example, limits of liability. Why worry about such a small point? The answer is because there have been occasions when say a zero has been missed off a number with dire consequences. A court MAY correct this if there is an obvious mistake, but that would take time and money. There is far less likely to be an error in a written expression as opposed to a numeric one. This precision and focus on small things will or at least should flow through into all other drafting.
As is often the case in writing this blog I seem to have come across something here that is not only well documented, but is an accepted principle. See, for example, this article The 80-20 Rule (aka Pareto Principle): What It Is, How It Works which describes the 80-20 rule as “The 80-20 rule, also known as the Pareto Principle, is a familiar saying that asserts that 80% of outcomes (or outputs) result from 20% of all causes (or inputs) for any given event.” This is not a new concept: “It was introduced in 1906 by Italian economist Vilfredo Pareto, who is best known for the concepts of Pareto efficiency. Pareto noticed that 20% of the pea pods in his garden were responsible for 80% of the peas. Pareto expanded this principle to macroeconomics by showing that 80% of the wealth in Italy was owned by 20% of the population.” The key takeaways include:
- The 80-20 rule prioritizes the 20% of factors that will produce the best results.
- A principle of the 80-20 rule is to identify an entity's best assets and use them efficiently to create maximum value.
- This rule is a precept, not a hard-and-fast mathematical law.
- 20% of customers account for 80% of total profits
- 20% of manufacturers supply 80% of the market
- 20% of sales reps generate 80% of total sales
Now I come to think about it, I have been applying this principle for a long time without fully appreciating that this is what I was doing. In private practice for example we recognised that most of our new business was likely to come from our top 20% of existing clients and focused our marketing efforts on them. This Forbes article Pareto Principle: How To Use It To Dramatically Grow Your Business acknowledges this and says you can take it a stage further. It cites Perry Marshall who in his book 80/20 Sales and Marketing found that “within that initial 20%, the 80/20 rule also exists. Meaning that the top 20% of the top 20% of your customers (or the top 4% overall) represent 64% of your sales”.
This principle applies equally well to how we manage our tasks in a professional practice and organise our time most effectively. This enables us in these complex and busy times to work more efficiently and incidentally reduce the stress of a hard working professional life. See this blog Managing Your Time And Practice Using The 80/20 Rulewhich comments “The 80/20 Rule is about optimizing your time. It is about focusing on the important 20% as a way to save time and maximize effort. Determine what types of tasks in your law practice produce the best results for clients and your business and focus your attention on those.” It recommends:
- Do the 20% first
- Schedule uninterrupted work time
So my proposition here is that this principle applies not only to the growth of professional practices and businesses generally, but also to the way we practice in industry and private firms. I started with the drafting example, and this clearly extends to time management. It also can apply to other professional activities such as research – see, for example, this blog The 80/20 Rule for Legal Research which determines that “out of all the searches you do and sources you read, only about 20 percent of them will appear directly in—will be cited in—your final work product.”
As the British consultant Richard Koch said in his book The 80/20 Principle: Achieve More with Less:
“Not all inputs are equal; some inputs are far more important and influential than others”.
“The best way to deal with information overload is to focus on the vital few and ignore the trivial many.”
“The goal is not to do more, but to do less and achieve more.”
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