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Summary: The 80/20 Principle Richard Koch

This ebook offers a summary of the book «The 80/20 Principle» by Richard Koch. Richard Koch argues persuasively in The 80/20 Principle that 80percent of the results in any system will flow from just 20percent of the efforts. Trying to eliminate the 80 percent is usually ineffective; therefore, try to expand the 20 percent. He gives the reader 10 techniques for increasing productivity in the 20 percent, explaining why they are valuable.

For example, he suggests that identifying the top 20 percent of profitable business can help shrink the 80 percent, because if you realise an area of your business is inefficient, you can establish short cuts. Businesses should focus marketing on their top 20 percent of products. Understand that only 20 percent of decisions will be the vital ones, and act accordingly. 20 percent of every salesforce will be the best: analyse and comprehend why this is so, and act accordingly. In negotiation, remember that again, you are probably only disputing about 20 percent of the issues being discussed: it's in your interests to always be aware of this.

The 80/20 Principle is an exceptionally useful paradigm to understand and put into practice, because it encourages continual selfawareness and prioritisation, which is how successful businesses flourish.
30 printed pages

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    Dinara Urozbayevashared an impression2 months ago
    👍Worth reading
    💡Learnt A Lot

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Quotes

    Dinara Urozbayevahas quoted2 months ago
    Concentrate on improving the high performing product lines. Be marketing-led in this area.
    Julieta Carolina Arteaga Legorretahas quoted4 months ago
    The information revolution which began in the 1960s also has 80/20 principles at its heart: the fact that 80-percent of the benefits of any system will be found in the simplest 20-percent of the system, the fact that 80-percent of any product’s use will take advantage of only 20-percent of the available features or the fact that people use 20-percent of any software package 80-percent of the time.
    The 80/20 principle also applies to industry sectors:
    Over time, 20-percent of the competing companies within an industry will have an 80-percent market share, and generate 80-percent of the profits.

    As new innovations are introduced to existing markets, companies will try and segment off portions of the existing market into smaller niches that can be defended.

    Of the emerging niches, only 20-percent will generate 80-percent of the added overall market value.
    Similarly, the 80/20 principle will apply to individual companies:
    80-percent of the surplus generated by profitable companies is created by 20-percent of the employees.
    G.Ghas quoted10 months ago
    ‘‘The reasonable man adapts himself to the world. The unreasonable one persists in trying to adapt the world to himself. Therefore all progress depends on the unreasonable man.’’

    --George Bernard

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