Why the 10-80-10 Rule Is Key To Achieving Success

team-building exercises, plan of action, motivation

The 10-80-10 rule is an extension of the Pareto principle that says 80% of productivity/wealth is generated/owned by 20% of the population.[1] This ratio is often observable in various statistics and studies.

The 10-80-10 rule takes this principle and applies it more specifically to human behavior. It is also malleable, enabling people to move between categories. If we apply it to a company (just as an example), in essence, the 10-80-10 rule looks like this:

  • 10% Highly Productive Elite – This is the core of your business. These people will work all the hours that God sends for your company, leaving no stone unturned and generating the maximum possible productivity/revenue for you that they can.
  • 80% Productive – These lovely folks make up the majority of your business and will work 9-5, getting their tasks done and not making much of a fuss about it. They are less likely to offer innovation, but they are reliable, trustworthy, and dutiful.
  • 10% Unproductive and Defiant – These people are outliers and mercifully low in number, but they create work. They are difficult, unwilling to work hard, and generally take more from your company than they give.

This can also be applied in other areas of life. Morality is another example, with the vast majority (80%) of us being law-abiding citizens who may bend the rules occasionally, 10% being unscrupulously good, and 10% being out-and-out criminals.

Table of Contents

  1. Who Came Up With the 10-80-10 Rule?
  2. How to Apply the 10-80-10 Rule to Management to Be More Successful
    • How Much of a Difference Would That Make?
    • Who Does This Desired Increase in Productivity Help You Become and Who Does It Serve?
    • Why Did They Feel More Motivated?
  3. How to Use the 10-80-10 Rule to Improve Success
  4. Final Thoughts
  5. More Tips on How to Improve Your Success

Who Came Up With the 10-80-10 Rule?

As touched on earlier, the 10-80-10 rule is an off-shoot of the Pareto Principle, first conceived of in the early twentieth century by Italian civil engineer turned economist Wilfredo Pareto. He simply observed that 80% of the property in Italy, at that time, was owned by 20% of the population. Wealth distribution, according to Pareto, was divided 20/80 across all sections of society. The country, age, gender, or industry didn’t matter. This principle still applied.

Later on in the 1940s, Joseph M. Juran (himself an engineer and management consultant) applied the Pareto Principle to human behavior with the aim of improving quality control, positing that 80% of the success on any one project would be due to the efforts of 20% of the team working on it.

Since then, various researchers and theorists have expanded the Pareto principle into the 10-80-10 rule—observing that 10% are true leaders, 80% seek guidance from others, and 10% wilfully act in a counter-productive manner.[2] Advertising

How to Apply the 10-80-10 Rule to Management to Be More Successful

Well, let’s stay with the team/workforce model for now: if you want to improve productivity in your company, where should your focus be? All too often, “the squeaky wheels get the grease.” That is to say, we tend to try and fix what’s most broken in our organization (namely the bottom 10%) before we move on to the less broken.

When you realize, though, that you’re pouring resources into just 10% of your labor force, it starts to look very inefficient. Moreover, that 10% is comprised of folks who are highly unlikely to change their tune (statistically anyway). You need to focus on the 80%. That’s where you’ll have the most impact and where you’ll create the biggest uplift in productivity. The 80% aren’t (of course) completely equal. Some will sit closer to either of the 10% range, but this means that you should be able to increase the size of your top 10% to be more like 20 or 30%.

How Much of a Difference Would That Make?

Now, before you slam your laptop shut, haul off, and start brainstorming ideas about team-building exercises and corporate days out, it is first very important to understand the metric by which you measure productivity. Numbers on a spreadsheet or letters next to a person’s name only paint part of the picture.

What you value in your company is unique to you. As I’m constantly saying to entrepreneurs and business owners that I coach, you have to be specific with what you are asking of your team, your customers, and the universe at large. Ask a vague question and you’ll get a vague answer.

So, do the work of understanding exactly what is working for you and what isn’t. Simply saying that you want revenue to increase is not enough. By how much? In what areas? Who will we add value to increase their spending with us? Where and whom should we target for new growth?

Who Does This Desired Increase in Productivity Help You Become and Who Does It Serve?

Armed with this, you will have much more clarity to take to your team and with which to start formulating a plan of action. You can look at what would incentivize those in the 80% who just need a slight nudge. That’s where minimum effort will yield maximum results! So, start there. Advertising

A 2014 Gallup poll found that a third of the US workforce felt unmotivated in their jobs, with the highest levels of motivation found among managers.[3] This tells us two things:

  • Firstly, the unmotivated third is comprised partly of those in the 80% camp, but the entirety of the unmotivated 10% is in there, too. If you take them out (because they are those people), the remainder isn’t as many people and they are in a group that still wants to work and get on.
  • Secondly, those in a position of management (i.e. those who feel as though they can effect change in the company) tend to be the most motivated.

Now, let’s not confuse motivation with productivity. You can be as motivated as you like, but without proper strategy or direction, you’ll just be a hammer in search of a nail. Nevertheless, those in management who felt the most motivated to be productive are worth interrogating.

Why Did They Feel More Motivated?

I would posit that the answer is very simple: they felt heard and that they could affect change. It’s a hugely important part of human psychology that we feel as though our ideas, thoughts, and feelings are heard by others. When we feel ignored, we feel unvalued. When we feel unvalued, we are (naturally) unmotivated.

This is not to say that you should make everyone a manager within your company. Your business might be a start-up or just a few people working out of your converted garage. The point is, make sure that they all feel heard. I guarantee you that—especially among the upper end of the 80%—you will see the greatest uptick in productivity if you simply listen to them. Make them feel as though they have a vested interest in growing your business, too.

If they can see the role that they play is important and understood by you, they will push themselves to go further, work harder, and achieve more. You have to put yourself in their shoes, which brings us on to the next point. . .

How to Use the 10-80-10 Rule to Improve Success

Okay, so far we’ve just looked at the 10-80-10 rule as it pertains to the success of groups. But how does it apply to us as individuals? What can we learn from it and use in our day-to-day lives?

Advertising

You might be a sole trader or maybe a consultant—someone who does not have a team to rally and simply sells your services to others. In that instance, how does this work for you? Divide yourself up into the 10-80-10. Do it by tasks: what are you most efficient/gifted at, what are you good at, and what do you constantly put off doing?

Here’s an example. Say you’re a writer (where did I get this one from?), and you’re very successful. You are asked to write articles for lots of great, top publications like LifeHack, or maybe you’re writing a book and your screenplay just got picked up by Warner Brothers. Writing is your 10% elite. It’s where you offer the greatest value.

It’s probably not the actual writing so much as it’s the creativity, ideas, and talent that you can bring to bear in your writing. The actual writing—sitting down at your computer, tapping it out, proofreading, and catching spelling/grammar mistakes—that’s your 80%. Sure, you’re good at it. You are competent and get it done. But it’s not where you are at your most powerful, and you usually run out of steam at some point during the day.

Then, there’s your bottom 10%. That’s probably your operational tasks, such as your timekeeping, bookkeeping, invoicing, correspondence, tax return, etc.

Where Do I Get These Examples From?

So, where can you be most effective in taking action that will support you in accelerating your growth? Again, start with the 80%. Try finding ways to improve the writing experience for you. Maybe observe yourself on a typical day, and note when you do your best work. It might be right after your second coffee that you stay at your desk for longer and write with the greatest clarity. So, start structuring your day around that.

What has that cost you? Nothing! It was simply a case of reorganizing your day and bingo, you are doing more of your best work in less time than it took you before. Pretty soon, after you’ve tightened up your day so that you are of maximum productivity, you’ll find that you have more time and resources.

Advertising

Once you are better resourced, having landed bigger and bigger jobs, you’ll be able to take care of that pesky bottom 10%. It could be that you eliminate it by outsourcing the work to someone else. Now that you earn more for less of your time, why not? Just take it out of the equation altogether.

Final Thoughts

The 10-80-10 rule is not about adding ridged structures or following strict rules per se. It’s simply a lens through which to view human behavior, including your own. The reason why it is (or could be) the key to your success is that it enables you to identify those small changes that you can make that will have the greatest impact and accelerate your growth the fastest.

If you categorize your labor and the labor of your employees in this way, you’ll be able to more easily identify where you can have maximum impact with minimum input. If you continue to work out from there, your success will snowball, and you’ll have the support in place to maintain it.

More Tips on How to Improve Your Success

Featured photo credit: Andreas Klassen via unsplash.com

News Related

OTHER NEWS

Logitech (LOGI) Tops Q3 Earnings Estimates, Raises Sales View

Logitech LOGI on Monday reported better-than-expected third-quarter fiscal 2022 results. The company’s third-quarter non-GAAP earnings of $1.55 per share surpassed the Zacks Consensus Estimate of $1.31. However, the bottom line ... Read more »

A. O. Smith (AOS) to Report Q4 Earnings: What's in the Cards?

A. O. Smith Corporation AOS is scheduled to report fourth-quarter 2021 results on Jan 27, before market open.The company delivered an earnings surprise of 16.82%, on average, in the trailing ... Read more »

Is ResMed a Buy Under $250?

Currently trading at less than $250, ResMed Inc. (RMD) exhibited solid fundamental performance in its last reported quarter based on its strong sales growth across its product portfolio. So, given ... Read more »

Grab These 3 Real Estate Mutual Funds for Sparkling Returns

Mutual funds are the cheapest and most convenient option for investors looking to park their money in the real estate sector. This category of funds offers solid protection against inflation. ... Read more »

Your Answer to This Crucial Question Will Make or Break Your Business's Growth

Do you want to be the Queen or do you want to be the Bank? In other words, as a business owner, do you want to have control or do ... Read more »

This Is Why Chevron (CVX) is Set for Strong Q4 Earnings

Chevron Corporation CVX is set to release fourth-quarter results before the opening bell on Jan 28. The current Zacks Consensus Estimate for the to-be-reported quarter is a profit of $3.07 ... Read more »

3 Stocks that Are Thriving in an Inflationary Environment

Inflation is one of the biggest threats facing the economy. One profitable strategy during this period of high inflation is to focus on stocks that have pricing power, as these ... Read more »

Explore These 5 Momentum Stocks Using Driehaus Strategy

Investors who tend to take higher risks can think of investing in momentum stocks to boost their gains. In this respect, the Driehaus strategy can be used to choose the ... Read more »

3M (MMM) Tops Q4 Earnings and Revenue Estimates

3M (MMM) came out with quarterly earnings of $2.31 per share, beating the Zacks Consensus Estimate of $2.03 per share. This compares to earnings of $2.38 per share a year ... Read more »

Annuities vs. Mutual Funds: Which One is Best for Retirement?

Deciding how to save for retirement is a tough choice. There are so many different ways to set your money aside and make it grow over the years to have ... Read more »

Is State Street a Buy Under $100?

State Street (STT) reported better-than-expected top- and bottom-line results in its most recent quarter. But the stock plunged in price after the company announced the planned retirement of the CEO ... Read more »

Soon, Corelle India Will Expand Its Online Presence

Corelle Brands LLC, an instant brands company, is an universal pioneer in the segment of cookware. The company is into manufacturing and marketing kitchenware offerings worldwide. The brand has its ... Read more »

What My Rescue Dog Taught Me About User Experience

“Why is that dog attached to a leash?” These were the first words out of my husband’s (then boyfriend) mouth one sunny June afternoon when I asked him to come ... Read more »

Report: Mega Iceberg Melting Dumps 152 Billion Tons of Water Into Ocean, Could Have 'Devastating' Effects on Environment

If you’ve ever thought about what happens to the water once an iceberg melts, the answer is nothing good. Gallo Images/Orbital Horizon/Copernicus Sentinel Data 2020Gallo Images/Orbital Horizon/Copernicus Sentinel Data 2020 ... Read more »

MarketBeat Podcast: ESG, Why Going Green Can Mean Big Growth

In the last year, a renewed focus on climate change is putting clean energy stocks in focus. This group of stocks includes companies who are committed to doing no harm ... Read more »

YCombinator-backed AppX Acquires Website Builder Platform Superpage

Social media solutions provider AppX has announced that it has acquired super.page, a website building platform, for an undisclosed amount.  pexels AppX had recently raised $ 1.3 Million in a ... Read more »

Floor & Decor (FND) Soars 8.6%: Is Further Upside Left in the Stock?

Floor & Decor (FND) shares rallied 8.6% in the last trading session to close at $105.14. This move can be attributable to notable volume with a higher number of shares ... Read more »

3 Large-Cap Momentum Plays Bucking the Market Correction

You wouldn’t know it by the negative sentiment swirling around the stock market lately, but approximately one-third of S&P 500 constituents are up year-to-date. Unfortunately, this group has been easily ... Read more »

Top 5 S&P 500 Stocks Poised to Beat on Q4 Earnings Next Week

Wall Street has seen a good start to the fourth-quarter 2021 earnings season. Although we are in the initial stages of the reporting cycle, the results are better than expected. ... Read more »

Shiller's Research Is a Money-Maker for the Investment Advice Field

I don’t believe that market timing is a bad idea. I believe that it’s the best idea there is. If Shiller’s Nobel-prize-winning research is legitimate research, irrational exuberance is a ... Read more »

Carvana (CVNA) Soars 16.4%: Is Further Upside Left in the Stock?

Carvana (CVNA) shares rallied 16.4% in the last trading session to close at $157.90. This move can be attributable to notable volume with a higher number of shares being traded ... Read more »

Fox Factory Holding (FOXF) Surges 4.8%: Is This an Indication of Further Gains?

Fox Factory Holding (FOXF) shares rallied 4.8% in the last trading session to close at $133.57. This move can be attributable to notable volume with a higher number of shares ... Read more »

3 Safe Stocks to Buy in a Dangerous Market

Low-Volatility Stocks Are Appealing in Volatile Market Conditions Whenever the market enters into correction territory, it’s incredibly important to review your portfolio and determine if any adjustments need to be ... Read more »

Reevoy Raises $4 Million In Seed Round Led By 9Unicorns And Venture Catalysts

B2B cross-border trade startup Reevoy, has raised a total of $4 Million as seed money, led by 9Unicorns and VCAT. The round also saw participation from Better Capital, Earlsfield Capital ... Read more »

Spinning Success In The Used Car Business

The Indian used-car market is estimated to reach sales of 6.7 Mn to 7.2 Mn units per year by 2022. Cashing in on the massive opportunity is the used car ... Read more »

It's Time to Step into Yum! Brands Stock

Popular restaurant franchisor Yum! Brands (NYSE: YUM) stock has been selling off with the benchmark indexes despite strong earnings. The Company is a franchisor of well-known restaurant brands including KFC, ... Read more »

Best Artificial Intelligence (AI) Stocks (Beyond GOOG)

Thinking artificial intelligence could boost your portfolio right about now? You’re right. But which AI stocks beyond the usual suspects: Alphabet Inc. (NASDAQ: GOOG), Apple Inc. (NASDAQ: AAPL), Twilio Inc. ... Read more »

Flint Raises $5.1 Million In Seed Round

With the goal of becoming a one-stop-shop for investors  seeking exposure to crypto assets, Bengaluru startup Flint has raised a $5.1 million in Seed round led by Sequoia Capital India ... Read more »

Student Scholarship Platform SuperScholar Raises $400,000

Founders of SuperScholar, Rohan Lodha and Priyes Bamne, aim to make online education accessible and affordable to every student in India and rest of the world. pexels The platform provides ... Read more »

It's Time To Buy Into The Schlumberger “Supercycle” 

Analysts Are Driving Schlumberger Higher  The analysts are driving shares of Schlumberger (NYSE: SLB) higher and we think this is just the beginning of a very long trend. The entire ... Read more »

Customers Bancorp (CUBI) Misses Q4 Earnings and Revenue Estimates

Customers Bancorp (CUBI) came out with quarterly earnings of $2.92 per share, missing the Zacks Consensus Estimate of $2.94 per share. This compares to earnings of $1.65 per share a ... Read more »

Relaxing IPO-focused Regulations Is the Need Of the Hour

There is a pressing question before Indian startups: Should I register my company in Singapore? Several Indian startups although operating in India, have registered holding companies in Singapore to benefit ... Read more »

Southern Missouri Bancorp (SMBC) Surpasses Q2 Earnings and Revenue Estimates

Southern Missouri Bancorp (SMBC) came out with quarterly earnings of $1.35 per share, beating the Zacks Consensus Estimate of $1.25 per share. This compares to earnings of $1.32 per share ... Read more »

Crane (CR) Surpasses Q4 Earnings and Revenue Estimates

Crane (CR) came out with quarterly earnings of $1.25 per share, beating the Zacks Consensus Estimate of $1.12 per share. This compares to earnings of $1 per share a year ... Read more »

Arrow Electronics (ARW) Outpaces Stock Market Gains: What You Should Know

Arrow Electronics (ARW) closed at $125.85 in the latest trading session, marking a +0.95% move from the prior day. The stock outpaced the S&P 500’s daily gain of 0.28%. Elsewhere, ... Read more »

SmarFinancial (SMBK) Beats Q4 Earnings and Revenue Estimates

SmarFinancial (SMBK) came out with quarterly earnings of $0.52 per share, beating the Zacks Consensus Estimate of $0.48 per share. This compares to earnings of $0.60 per share a year ... Read more »

Great Southern Bancorp (GSBC) Q4 Earnings Miss Estimates

Great Southern Bancorp (GSBC) came out with quarterly earnings of $1.14 per share, missing the Zacks Consensus Estimate of $1.30 per share. This compares to earnings of $1.28 per share ... Read more »

5 Popular ETF Investment Themes to Consider in 2022

Wall Street has witnessed a very rocky start to 2022. The Dow Jones Industrial Average and the S&P 500 indices saw a third consecutive week of decline along with experiencing ... Read more »

Opendoor Technologies Inc. (OPEN) Stock Sinks As Market Gains: What You Should Know

Opendoor Technologies Inc. (OPEN) closed the most recent trading day at $9.36, moving -1.16% from the previous trading session. This move lagged the S&P 500’s daily gain of 0.28%. Elsewhere, ... Read more »

Coinbase Stock is Giving an Opening for Buyers

Cryptocurrency trading marketplace Coinbase (NASDAQ: COIN) stock has plunged with the technology stocks and cryptocurrencies losing more than (-23%) in January 2022. The popular digital crypto trading app platform has ... Read more »
On free-english-test.com you will find lots of free English exam practice materials to help you improve your English skills: grammar, listening, reading, writing, ielts, toeic