The 80/20 Rule

Vilfredo Pareto was an economist who is credited with establishing what is now widely known as the Pareto Principle, or the 80/20 rule. When he discovered the principle, it established that 80% of the land in Italy was owned by 20% of the population. Later, he discovered that the Pareto Principle was valid in other parts of life. In general:

80% of process defects arise from 20% of the process issues!
20% of your sales force produces 80% of your company revenues!
80% of delays in schedule arise from 20% of the possible causes of the delays!
80% of customer complaints arise from 20% of your products or services !

How is it for you and your solutions ? Do 20% of your solutions produce 80% of the results?
How much of your company’s resources do your sales reps waste by taking 100% of your product offering with them on a sales call, but onlyselling 20%?

It doesn’t take much effort to realize that one of the critical methods for increasing your revenue is to sell some of those other products that never get much attention. Whether your product line is comprised of new releases, a broader product offering due to an acquisition, or your portfolio has been around for some time, generating untapped revenue is at your disposal. Like it or not, most sales organizations suffer from this 80/20 rule when it comes to selling across abroad product line. One of the most painful components is the introduction of new products. Most organizations pour a tremendous amount of resources into speeding up the development process and measure themselves on time to market; however, most organizations do not measure “time to revenue”, which is a critical look at how fast the revenue ramp is for new products once they are available.