This theory, often known as “The 80-20 rule,” argues that in many cases, 80 percent of the consequences are caused by just 20 percent of the causes. In economics, criminology, software development, and business, this rule has been implemented. In the next few minutes, you’ll see how it relates to project management in particular.
Italian economist and sociologist Vilfredo Pareto are widely credited with coining the term “Pareto’s Law,” which states that just 20 percent of taxpayers generate 80 percent in tax revenue. A more general statement that 20% of the population possessed 80% of the wealth was subsequently made by him in his subsequent remarks. Many other fields have used the theory since, including economics and sales strategy as well as human resources management and manufacturing. It is now a mathematical formula that can be used across a wide range of fields.
Using the Pareto Principle as a project management tool
In nature, there is seldom an equal distribution of any valuable resource. There is a concentration of goods produced by the minority that accounts for the majority of a farmer’s output in population, wealth, workplace productivity, and even the harvest of a farmer’s plot. While concentrating on just 20% of the work, you may achieve 80% of your project’s goals by completing only 20% of the labor.
This is nothing new or groundbreaking, but it is easy to lose sight of the activities that will have the most impact on your customers or projects amid the daily grind of operating and managing projects, performing tasks, and reaching milestones. As a reminder, here are a few ways you can apply Pareto’s Principle to become a better project manager.
Involved Stakeholder management
All projects have a set of stakeholders whose actions may have an impact on the outcome. All projects need a certain level of support from the project’s stakeholders, and this support may make or fail a project. As part of your stakeholder impact assessment, you evaluate which stakeholders will be your biggest supporters and those who are a bit trickier, but without whose support your project might fail or even falter. Although you’ll have to put in more effort, you’ll reap more benefits in the long run. By concentrating your efforts on those stakeholders who have the most influence on the project’s outcome, you may assist ensure its success. When it comes to dealing with time-hungry stakeholders, it’s important to remember that it’s worth it if the effort pays off.
In-person gatherings of the whole group
The secret to success is not in how much you have, but how well you have it. In contrast to an hour-long meeting filled with interruptions, 20-minute quality interaction with team members may be much more fruitful. To get the most out of the 20% of your time that will provide the greatest outcomes, you must stay focused and avoid distractions.
Scheduling a Project
Project managers are always on the lookout for the most time- and cost-effective methods to do their work. Using the 80/20 rule, you may concentrate your efforts on the 20% of tasks that are most critical to the project’s success. Your project’s success will be determined by the tasks on your critical path, which you may identify by looking at your project plan. Your project will be better off if you concentrate all your efforts on its key route.
The Pareto Principle also applies to risks and concerns. In risk management and problem resolution, 80% of your difficulties will be caused by only a few significant issues whether it’s a faulty line of code, a troublesome vendor, or lower-quality materials. Find out what’s causing your issues, and then look for solutions. Invest your time and efforts in resolving the issues that have the most impact. Because they are the most difficult and time-consuming to resolve, they may be the root of the majority of the troubles.
Management of your time
For many people, the most productive time of the day is during their “power hours,” when they are most focused on their work. Even if the dates and times don’t match up perfectly, the sum will be close. The remainder of the day is often spent in meetings, either on-site or off-site or doing menial chores that don’t advance the project.
Management of Resources
As a project manager, you have a few individuals on your project team that are constantly present at your meetings and provide amazing ideas and challenges when necessary. They are dedicated workers who consistently provide results. Those are your “vital a few.” Don’t put too much pressure on these individuals.
In project management, Pareto’s Principle may be used in a variety of ways. As a project manager, get in contact with Green Projects Consulting to learn more about the Pareto concept and how it may help you better manage your project teams and resources.