Why the 80-20 Rule is Wrong

I guess "wrong" is the new "right, but with a corollary" -- the 80-20 rule also implies that the last 20% takes 80% of the effort.

The Pareto principle is an observation. It does not declare that all distributions are Pareto distributions. The application of the observation to optimization is not itself the Pareto principle.

My problem with this article is that it starts by completely misinterpreting the Pareto Principle:

[The Pareto Principle] guides us to spend little time on many things, without over investing in any one thing...

No. That is precisely what the Pareto Principle does not do. The Principle suggests that we spend all our time on a relative handful of "things", because that will produce most of our desired result. In other words, the Principle is "'overinvest' in a few things, and disregard the rest for the moment".

Why is (say) Apple Computer "perfect"? [1] Because Apple Computer looked at all the things the company might do with its time, then chose to invest in a relative handful of products. The list of things that Apple could do (like: seriously compete with Microsoft in the office-suite market; seriously compete with Linux in the server market; seriously compete with Asus in the cheap netbook market) is far larger than the list of things which Apple actually does.

Moreover, the Principle is fractal. Why is a single Apple product, the iPhone, "perfect"? [2] Because they looked at all the things they could do with a phone product and decided to "over"emphasize a relative handful, like "the web browser". Why is the iPhone's web browser "perfect"? [3] Because they focused intently on certain features, at the expense of others. The browser famously did not support cut and paste on initial release, and it still won't play Flash... but these don't stop it from being a delightful product.

In addition, the Principle is iterative. If you have a goal, you should see if you can get 80% of the way there with 20% of the effort. And, once you've put in that effort and are 80% of the way there, you may find that another 20% of the remaining effort will get you 80% of the rest of the way. And so on. Notice that never does the Principle say that you can't spend 100% of your time working toward your one true goal. The Principle is just trying to help you spend that time wisely.

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[1] They're a very popular example of a "perfect" thing, and this author is not immune to their charms. But, of course, in reality Apple Computer is far from perfect. They have all kinds of problems. But the company is very, very good at figuring out which 20% of the tasks they need to do to convince 80% of their customers that they are perfect 80% of the time.

[2] It isn't, of course. In ways that are really noticeable to, say, 20% of the market: Doesn't have a hardware keyboard option, doesn't allow you to drain your own battery by launching background processes, has a proprietary app store with strangely arbitrary rules, has an exclusive carrier agreement with AT&T and therefore drops a lot of calls. Et cetera. But 80% of the market doesn't notice that.

[3] It isn't, of course. But it's really good at faking it, on a fraction of the effort. Notice a trend in these footnotes yet?

The 80-20 rule in witch I trust is a bit different: any complex enough program takes 20% of the time to get to 80% (that's a working alpha doing most of the things it is supposed to do) and 80% of the effort to reach a stable status where it's ready for prime time.

Btw the only reason this rule works is because programmers tend to greatly underestimate the time that it takes to do bugs fixing, testing, coverage of corner cases, and so on.

He makes a good point - sometimes it's that last little bit of skill that makes the difference between a success and a failure. When you completely master something, the whole game can change.

The problem is that it's insanely hard to completely master something - there's the time involved in doing it, but there's ALSO the fact that you're competing with everyone else who's also trying to master it.

The real value of the 80/20 rule, I think, is that it gives you the ability to devote time to several different pursuits, giving you a combination of skills that few other people can match. Call this the 'Scott Adams Rule' of success - you can either be the very best at something, or be in the top 25% of 2 or more things and combine them.

See: http://dilbertblog.typepad.com/the_dilbert_blog/2007/07/care...

Okay, but the school example is bull. I've blown people away with all kinds of stuff, but i've never gotten anything more than an "A" out of it.

Of course this is one way in which school is unlike real life. In school your success is effectively capped, whereas in real life it is... well... still capped, but very very loosely so compared to the school environment.

In other words: school encourages mediocrity because you can never break the 100% barrier.

Now i know that's a generalization, but it's a lot more true than the given example.

I find it interesting that the majority of the comments on this post seem to focus on "how this article got the rule wrong." Sure, it may be true that the way the author interprets a version of the 80/20 rule may not be the same as as everyone else, but its just an interpretation so relax a bit and see that he does make a interesting point:

Many people go through life putting in "just what it takes" to get the job done and be "good enough" without failing. You can certainly choose to live your life that way, but you will probably end up being stuck with mediocrity. However, if go the extra mile, you may be more likely (but not guaranteed) to achieve greatness in whatever it is that you do.

Maybe I'm also interpreting it differently and over-generalizing, but this seems a lot like what what many startups are doing just by the nature of starting up... many companies are started by founders that weren't happy with competing products currently available in their market, and they feel they can do better. Even though its a lot more effort to do this than just getting by with what is currently available, it can lead to some really exciting new opportunities.

How can something that only purports to be applicable to some scenarios be wrong?

I don't really think this guy understands the 80/20 rule at all. He seems to be very young.

I agree with the article for the most part but I think it's academic. Anyone who was willing to stop at 20% of their effort and "accept the B" isn't interested in being extraordinary. While anyone who wants to be extraordinary is going to put everything they've got into what they do regardless.

So the 80/20 rule is only really of use for those whose goal is to get by on the "mediocre trap" level

(which isn't necessarily a bad thing btw. A lot of people are happy to be average at their job and put their focus on personal life and without those average folks the extraordinary wouldn't be so special)

Nice blog post. I especially like the idea of the "mediocrity trap" that occurs when we realize that we can get B results by investing 20% of efforts but need to invest 80% of effort before we start getting to A work.

Just want to point out the comment by "vkrm20" at the bottom of the post. It's very simple. 20% entails a percentage of what you put in. This guy missed such a simple fact.

One should not arbitrarily assign percentages to other arbitrary percentages. What makes it possible for me to say I expended 20% of my effort writing an essay? And if i did that then the 80/20 rule as I see it, would apply relative to that 20%, not the arbitrary 100% of my "possible efforts".

Scope, Scope, scope.

Doesn't sound like the rule is "wrong," in the sense that factor sparsity is not actually a common occurrence or matter of economic fact. Rather, the article suggests that it is often ideologically misapplied.

Pareto principle is based on Statistics. And

    Science != Statistics

I read the first 20% of this article. Think I got the gist.