If you’ve ever gone trick-or-treating on Halloween, you may be familiar with the Pareto principle. When going door-to-door in search of candy, there definitely wasn’t an equal distribution of candy donations from your neighbors. Some of the homes were likely vacant for the night, some residents may have avoided answering the door, and others might have doled out only a single treat to your growing supply of sugary goods. A few generous neighbors probably contributed the majority of your candy, kindly doling out handfuls of lollipops, full-size chocolate bars, or even small gift bags.
The observation that the majority of effects (such as a Halloween candy haul) come from a minority of causes (homeowners) is not only applicable to trick-or-treating but to a wide variety of circumstances including marketing, healthcare, and quality control. As economist and sociologist, Vilfredo Pareto noticed, 20 percent of causes are often responsible for 80 percent of effects or outcomes.1 This ‘80/20 rule’ is most commonly known as the Pareto Principle, or as Joseph. M. Juran has also called it, the law of the ‘vital few and the trivial many.’2 The Pareto principle serves to this day as a useful basis for analysis which can help both individuals and organizations to set priorities and make effective decisions.