Saturday, November 29, 2008

The Pareto Principle

The Pareto Principle
Have you ever noticed that you 80% of your spent time gives only 20% of your total productivity? While sometimes 20% of the time you spend achieves 80% of the desired goal! In fact what I just mentioned here is called The Pareto Principle. This principle states that 80% of the input produces 20% of the output and vice verse (20% of the input produces 80% of the output).

I am sure while you are reading these lines you are browsing through your memory, remembering examples you have experienced of this principle. Recently, I have noticed a simple Pareto Principle example. The Capital Bank places a weekly report in Al-Rai newspaper about the stock market in Jordan and guess what, the total value of 30 companies of the market is equal to 80% of the total value of the market.
So friends, from now on watch out for the Pareto Principle ;-)
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