Comments on: Can you predict the “20″ in 80/20? http://www.johndcook.com/blog/2009/07/29/can-you-predict-the-20-in-8020/ The blog of John D. Cook Sat, 11 Feb 2012 01:10:06 -0500 http://wordpress.org/?v=2.8.4 hourly 1 By: human mathematics http://www.johndcook.com/blog/2009/07/29/can-you-predict-the-20-in-8020/comment-page-1/#comment-136222 human mathematics Wed, 08 Feb 2012 23:52:24 +0000 http://www.johndcook.com/blog/?p=2762#comment-136222 Some of the books recommend firing customers (or cease recruiting new ones of the same type) after observing that they're not worth the effort. That's reasonable. Another way to look at 80/20 is: you can't do everything. Take time to think strategically about priorities. Easier said than done, of course. Yet another way: power laws (or power-law-ish distributions) are everywhere. Some of the books recommend firing customers (or cease recruiting new ones of the same type) after observing that they’re not worth the effort. That’s reasonable.

Another way to look at 80/20 is: you can’t do everything. Take time to think strategically about priorities. Easier said than done, of course.

Yet another way: power laws (or power-law-ish distributions) are everywhere.

]]> By: Momekh http://www.johndcook.com/blog/2009/07/29/can-you-predict-the-20-in-8020/comment-page-1/#comment-136108 Momekh Wed, 08 Feb 2012 13:41:59 +0000 http://www.johndcook.com/blog/?p=2762#comment-136108 Interesting. Boiling all of it down to finding out what's most productive, isn't that what the field of management consultancy is all about? That's not a rhetorical question. I mean, isn't that what you are doing when you are trying to cut costs in a business, or find time in your life? You trying to do the best of things and leaving out the rest. And being cynical about ANYTHING is easy. Ask a cynic. :) Thanks for the reminder, John. Interesting.

Boiling all of it down to finding out what’s most productive, isn’t that what the field of management consultancy is all about? That’s not a rhetorical question.

I mean, isn’t that what you are doing when you are trying to cut costs in a business, or find time in your life? You trying to do the best of things and leaving out the rest.

And being cynical about ANYTHING is easy. Ask a cynic. :)

Thanks for the reminder, John.

]]> By: Florin http://www.johndcook.com/blog/2009/07/29/can-you-predict-the-20-in-8020/comment-page-1/#comment-21914 Florin Sun, 02 Aug 2009 04:46:56 +0000 http://www.johndcook.com/blog/?p=2762#comment-21914 If you apply the 80/20 rule recursively, you get... <a href="http://www.thelongtail.com/" rel="nofollow">The Long Tail</a>. If you apply the 80/20 rule recursively, you get… The Long Tail.

]]> By: John Conti http://www.johndcook.com/blog/2009/07/29/can-you-predict-the-20-in-8020/comment-page-1/#comment-21792 John Conti Wed, 29 Jul 2009 20:47:01 +0000 http://www.johndcook.com/blog/?p=2762#comment-21792 Doesn't a recursive application of the 80/20 rule == Learning? Fun stuff.. ,John Doesn’t a recursive application of the 80/20 rule == Learning?

Fun stuff..

,John

]]> By: Bill the Lizard http://www.johndcook.com/blog/2009/07/29/can-you-predict-the-20-in-8020/comment-page-1/#comment-21784 Bill the Lizard Wed, 29 Jul 2009 17:57:03 +0000 http://www.johndcook.com/blog/?p=2762#comment-21784 "It takes experience and hard work." Exactly. To extend your example, the inexperienced salesman who tries to exploit the 80/20 rule is much more likely to choose the wrong 20 and have 0 sales to show for it. This reminds me of those who try to time the stock market. It only seems like it can be done successfully because out of the thousands each year who try it, a lucky few get rich. It requires hindsight to identify those lucky few. “It takes experience and hard work.”

Exactly. To extend your example, the inexperienced salesman who tries to exploit the 80/20 rule is much more likely to choose the wrong 20 and have 0 sales to show for it. This reminds me of those who try to time the stock market. It only seems like it can be done successfully because out of the thousands each year who try it, a lucky few get rich. It requires hindsight to identify those lucky few.

]]> By: Aaron Evans http://www.johndcook.com/blog/2009/07/29/can-you-predict-the-20-in-8020/comment-page-1/#comment-21778 Aaron Evans Wed, 29 Jul 2009 15:26:48 +0000 http://www.johndcook.com/blog/?p=2762#comment-21778 The trick (buy my book, attend my seminar) is not to find out what the 20% are, but to find out what the 80% are as fast as possible, and eliminated them. Of course, the best heuristic has flaws, and may accidentally eliminate some of the good, but here the 80/20 rules applies also. The trick (buy my book, attend my seminar) is not to find out what the 20% are, but to find out what the 80% are as fast as possible, and eliminated them. Of course, the best heuristic has flaws, and may accidentally eliminate some of the good, but here the 80/20 rules applies also.

]]> By: John http://www.johndcook.com/blog/2009/07/29/can-you-predict-the-20-in-8020/comment-page-1/#comment-21777 John Wed, 29 Jul 2009 15:00:58 +0000 http://www.johndcook.com/blog/?p=2762#comment-21777 If I could restate your question, does the 80/20 rule apply recursively? This often comes up, and sometimes <a href="http://secretgeek.net/pareto_recurse.asp" rel="nofollow">applying the rule recursively is silly</a>. But sometimes it you really can apply the rule a few times. Say you want to learn a foreign language. The most common 1000 words are far more important than the rest. And among those 1000 words, the top 200 are more important than the rest. Or say you're looking at wealth. Maybe the top 20% have 80% of a nation's wealth. And maybe the top 4% (20% of 20%) do have roughly 64% (80% of 80%) of the wealth. (This is the context where Pareto discovered the 80/20 rule.) If I could restate your question, does the 80/20 rule apply recursively? This often comes up, and sometimes applying the rule recursively is silly. But sometimes it you really can apply the rule a few times.

Say you want to learn a foreign language. The most common 1000 words are far more important than the rest. And among those 1000 words, the top 200 are more important than the rest.

Or say you’re looking at wealth. Maybe the top 20% have 80% of a nation’s wealth. And maybe the top 4% (20% of 20%) do have roughly 64% (80% of 80%) of the wealth. (This is the context where Pareto discovered the 80/20 rule.)

]]> By: Eric http://www.johndcook.com/blog/2009/07/29/can-you-predict-the-20-in-8020/comment-page-1/#comment-21775 Eric Wed, 29 Jul 2009 14:47:12 +0000 http://www.johndcook.com/blog/?p=2762#comment-21775 If you could predict what the 20% would be, and only talked to them, would the 80/20 rule apply again? If you know which 20 out of 100 people to talk to and only talked to them, would you get 80% of your output from four of them? If you could predict what the 20% would be, and only talked to them, would the 80/20 rule apply again? If you know which 20 out of 100 people to talk to and only talked to them, would you get 80% of your output from four of them?

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