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Episode 64 - The War on Waste Paradox - Chapter 14 - Part 1 - Audio Book
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Historically, the 80/20 Rule was the greatest tool in our bag of tricks before we discovered the 5/67 rule. The 80/20 rule tells us that 80% of revenues comes from 20% of customers, 80% of customer problem calls come from 20% of customers (hopefully they aren’t the same as the customers generating 80% of the revenues) and so forth. I remember learning about this several years ago. I think I learned it from my Dad. Just before my Dad died, I had a chance to visit him alone on one weekend. We talked about a lot of things. I remember telling him that he taught me a valuable business lesson known as the 80/20 Rule. He was surprised for two reasons: one, that I would admit that I learned anything from him and two, he had never heard of the 80/20 rule. I said that I learned it the hard way. I always assumed that when I needed $100 to fix a piece of equipment and he gave me only $20 (20%) of that, that there was some logic to his method. He always got about 80% of the problem solved by spending only 20% of the cost. We both got a laugh out of that.
Best, Len Bertain
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