The Pareto Principle still holds very true when assesing your network. It may have become an unweildy and misunderstood tool, but I have found that within my contacts, there certainly exists a small and powerful 20 percent.
A brief internet search will tell you just how many areas of life Vilfredo Pareto’s 80/20 rule has been applied to. Intitially created to describe the inequalities of wealth distribution in Italy, the concept that a minority 20 percent of a population posess 80 percent of the wealth has been applied as a general descriptor of imbalance in areas beyond economics.
This wider interpretation of the principle states that 20 percent of a set is responsible for 80 percent of a related result. It can be applied to time allocation, stock-management, team dynamics and many other situations. It can even be applied in reverse, used to describe how 80 percent of your problems may result from the same 20 percent of issues.
The principle is often misunderstood and used an a justification for a kind of organisational culling, which is not the intention – certainly not when applied to network contacts. The principle is about being aware of where true value lies – not restricting your activities to that area. Take time management as an example.
20 percent of your time may be spent on billable hours, actually consulting. The remaining time may be spent on activities which yeild less income, such as dealing with emails, phone calls, accounting, networking, or travelling. Just because 80 percent of your profit results from the former 20 percent of time, doesn’t give you liscence to dispense with the rest. Your supporting activities are not a waste of your time – they are essential, but by being aware of what activities bring financial results you are in a better position to strategise.
In the case of personnel, identifying a valuable 20 percent subset of individuals within your organisation does not then mean you should invert the ratio and devote 80 percent of your time to your ‘star performers’. It may well be those who aren’t performaing so well who need the lions share of a leader’s assistance and attention.
When it comes to your network contacts, the 80/20 Principle acts as a reminder to focus your attention on the subset from which you can derive the most value – those who provide the most opportunities for work or routes to work. Your entire business network is valuable but, if your time is limited, ensure you make time for your key contacts.
As with the less lucrative activities in your timetable, you cannot simply dispense with the less valuable 80 percent of your contacts. As with team management, you may wish to deliberately devote time to less valuable, more remote contacts and attempt to form a closer professional link which may bring them into the core 20 percent. As this suggests, your significant 20 percent may be fluid and likely to change over time. However, it is important to understand what it is and who it contains right now.
Being aware of your key contacts allows you to work smarter and, in a world where time is precious, to know who you absolutely must make time for.