This story begins in 1906 with an economist who was observing the peas in his garden. The Italian Vilfredo Pareto, of course, was not just anyone. He was an outstanding personality, sociologist, philosopher and economist. It was in his garden that Pareto noticed that 20% of the peas were giving 80% of the total production. Pareto further studied the 80/20 ratio, proving that in Italy 20% of the population possessed 80% of the total wealth and providing many other examples that confirmed the aforementioned principle.
The 80/20 rule suggests that 80% of the results are usually obtained by 20% of the effort put by a person or a company. Fewer factors (20%) are vital and many (80%) are trivial, which reminds of the ancient Greek saying “less is more” or “quality over quantity”.
So, what would you think if e.g. 80% of your pharmacy revenue comes from 20% of your customers? Have you ever noticed that 20% of your efforts account for 80% of your turnover? Have you wondered if 20% of your staff is responsible for 80% of your unhappy customers?
A modern pharmacist must integrate modern management in his business. You have to make vital decisions on how to target your major customers, reward your more productive employees and promote products. You have to be able to run marketing campaigns targeting the vital 20% of your clientele who provides the 80% of your revenue. Understanding the Pareto principle is essential to learning how to prioritize your tasks and apply it to goal setting and productivity.