It is also important to identify the vital few things that customers value. The most profitable players can be clues for finding the vital few activities, products and services. But imitation will not be enough. 80/20 individuals create their own vital few mix, something new and unique. One can mix and match some of the following generic strategies to the area that best fits the 80/20 spike: think big, think small, think upmarket, think mass market, pursue value innovation: provide more or less, use direct distribution channels, focus on activities with the highest ratio of value to cost..

Individuals can use the 80/20 Principle to exploit their organizations in an ethical way. Individuals need to identify the few really powerful businesses that may account for the success of the organization. 80/20 individuals can find new ways to exploit the ideas that have made their firms successful. They can also choose the ownership solution that suits them the best. A hybrid solution-a joint venture between the existing company and 80/20 individual can add to the profits of the old company and also eliminate the risk of venturing into a new business all alone. There are abundant business ideas and opportunities, but the idea of the 20% spike implies that one should not look for any old opportunity, however great it may be. One should look for the specific opening that he or she can exploit better and more creatively than anyone else. One should also identify the “vital few” ideas that can bring success. The ideas should also fit the 20% spike. One has to take those ideas and make better use of them than anyone else. One should also find the vital few profit forces that can work for him or her, enlist capital and enlist great individuals.
than what is needed. One should make it a rule to save 20 percent of his income. One should also use the cheapest available sources of external capital. Capital providers should be treated as values partners. Obligations should be taken seriously and one should exceed every budget target and expectations. 80/20 individuals start with a very small amount of capital and end up with huge amounts. They leverage and exploit capital but also respect its scarcity.

The 80/20 Principle reveals that there are always a few things that matter hugely while the rest can be ignored. Running a business on the 80/20 Principle can make one happier and have more impact on the world. Material progress in the past 300 years has demonstrated the 80/20 Principle’s applications in business. We are constantly generating more from less. 300 years ago, 97% or more of people worked on the land, most threatened from time to time with malnutrition or starvation. In the developed world, only 2-3% of people work in agriculture, and yet they produce more and better food than ever before.

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This case study is intended to be used as a basis for class discussion rather than to illustrate either effective or ineffective handling of a management situation. This case was compiled from published sources.