Understanding and applying the 80/20 rule can help you tremendously with your success.
What is the 80/20 rule? The 80/20 rule, also known as “Pareto’s principle,” was conceptualized by Italian economist Vilfredo Pareto. In 1906, he discovered that 80% of the wealth in Italy was owned by 20% of the population.
As it turns out, this 80/20 distribution of cause and effect occurs frequently. In the real estate world, 80% of the homes are sold by 20% of the real estate agents. Actually, in any professional occupation, you’ll discover that 80% of the results (e.g. productivity and profitability) come from 20% of your (or the company’s) effort.
When it comes to real estate sales, we know there are five income-producing activities: scripts and role play, lead generation, lead follow-up, appointments, and negotiating contracts. It’s important to understand that not everything matters equally. You must focus your efforts on the 20% that matters most. We don’t need to master everything—we simply need to master the 20% that produces the 80%. Your goal in real estate sales should be to spend 80% of your own time in the 20% of those five activities.
How does this work? If you have a list of 10 items to accomplish, two of those items will be worth more than the other eight items put together. The sad fact is, most people procrastinate on the top 10% or 20% of the items that are the most valuable and busy themselves instead with the more trivial 80%.
How can you apply the 80/20 rule to goal-setting and your overall productivity? First, take a piece of paper and write down 10 goals. Then, ask yourself if you could only accomplish one goal today, which one would have the greatest impact on your life? After that, pick the second-most important goal. After you finish this exercise, you’ll have predetermined the most important 20% of your goals that will help you more than anything else.
Remember, success is sequential. It’s not simultaneous. It’s like a geometric progression in life that’s set up like a row of dominos. If you focus on knocking down that first domino, you can rest assured that the rest will fall. This sounds simple, but it’s not easy. In real estate, easy is being distracted and focusing on urgent things that are cleverly disguised as important.
So, ask yourself, what is the one thing you can do that, just by doing it, will make everything else easier or unnecessary?
If you have any other questions about applying the 80/20 rule to your goal-setting or there’s anything else I can help you with, don’t hesitate to reach out to me. I’d be glad to help you.
In the meantime, good luck with your focus.