CorporateCoach eNewsletter

Issue No. 24, 1st September 2003

CONTENTS

  1. Editorial: Check out your old habits
  2. Book review: The 80/20 Principle


1.     Editorial: Check out your old habitsRichard Winfield

Richard Winfield

I have just returned from a wonderful holiday in the sun.

I hope other readers have also had a rest and a change and are back rejuvenated.

Working on a tan might not be recommended by dermatologists, but it is an excellent way to empty the mind.

The beaches were generally clean and clear of litter – except that in the sand and the dunes there were lots of old cigarette ends. It is a particular amazement to me that otherwise respectable people will repeatedly and thoughtlessly stub out their cigarettes on the pavement, or even on the dance floor. They would not think of dropping any other form of litter or vandalising property.

So, why cigarette ends?

It occurred to me that before the health fears of nicotine, most cigarettes did no have filters. The nub end was just a few vegetable fibres and some very thin paper. Stub it out under your heel and it broke up and rapidly rotted away.

Unfortunately, with the introduction of filters, which do not rot, the habit has continued and been passed on to following generations. Similar problems occur in developing countries where vegetable packaging has been replaced by paper and plastic.

This is not an unusual experience.

There is a story about the artillery. Just before the gun was fired a soldier would step back a few paces, and then return after the shot. Why? Well the rule book was written in the time of horses and the soldier stepped back to hold the horse's head through the bang – but there had been no horses for several decades!

You might think that such things do not happen these days in civilian life. When I was a transport planner I studied local bus services. One route went into a coal mine, waited for twenty minutes and then drove out. The mine had been closed down two years ago, but the timetable had not been revised.

Similarly, many pieces of research are later disproved or applied in inappropriate circumstances – but by this time they have entered the general consciousness and are taken for granted. For example, we are frequently told in communications courses that content is only a minor part of the message.

  • 7% of meaning is in the words that are spoken.
  • 38% of meaning is the way that the words are said
  • 55% of meaning is in facial expression

These figures contain a valuable truth in drawing attention to the contribution of non-verbal information in a message.

However, they are not actually correct for general communication. Note the comment by original researcher Albert Mehrabian "These equations regarding relative importance of verbal and nonverbal messages were derived from experiments dealing with communications of feelings and attitudes (i.e., like-dislike). Unless a communicator is talking about their feelings or attitudes, these equations are not applicable."

How much of your business or personal behaviour is based on out-dated assumptions or misunderstandings?

It pays to check.

USEFUL LINK:


SEASONAL PLUG:

Between now and the end of the year, many organisations will be reviewing their strategy and business plans, and preparing budgets for the next financial year.

Contact Brefi Group to learn how a facilitator can help you get far more value out of an awayday, corporate retreat or strategy meeting.


2.     Book review: "The 80/20 Principle: The Secret of Achieving More with Less" by Richard Koch

How would you like to work two days a week and be 60 percent more effective than you are now? That?s the astonishing claim made in my favourite self-development book, The 80/20 principle: The Secret Of Achieving More With Less. Most of you will be familiar with the story of the Italian economist, Vilfredo Pareto, who discovered that there was a constant relationship between the top earners in 18th century Italy and the percentage of incomes they earned. He established that there was a constant and measurable relationship that could be seen across any time period or country.

This was later simplified into the 80/20 principle, a simple observation of the fact that the universe is ?wonky?. Or put another way; a minority of causes, inputs or effort usually lead to a majority of effects, outputs or rewards. For example: 20 percent of your carpet at home is likely to get 80 percent of the wear; 20 percent of your customers account for 80 percent of your sales. And so on. The relationship between effort and reward is almost never 50:50 and whether it is 99:1 or 60:40 it remains unequal.

Starting with this premise, Richard Koch takes the 80:20 principle and applies it in a number of very practical and useful ways to corporate strategy and personal effectiveness. Among his case studies is Filofax, who were producing hundreds of costly variants of insert by the 1990?s. Inventory management was out of control and costs were spiralling. After careful study they found that only 20 percent of the inserts they made were being used 80 percent of the time. They subsequently cut all the slow moving and low demand lines with minimal impact on sales and massive benefits in inventory management.

On a more personal level, he argues that managers are awash with time but that they only make good use of about 20 per cent of it. The 80/20 principle says that if we doubled our time on the top 20 percent of activities (those that make the real difference), we could work a two-day week and achieve 60 percent more than we do now. He then outlines seven steps for achieving this:

  1. Make the difficult mental leap of dissociating effort and reward
  2. Give up guilt
  3. Free yourself from obligations imposed by others
  4. Be unconventional and eccentric in your use of time
  5. Identify the 20 percent that gives you 80 percent
  6. Multiply the 20 percent of you time that gives you 80 percent
  7. Eliminate or reduce the low value activities

There are some obvious parallels here between his recommendations and Steven Covey's Quadrant II time management but The 80/20 Principle goes a lot further and is an easier read. The first half of the book is a startlingly useful application of the principle to business and strategy while the second half concentrates on personal effectiveness. All in all, this is a highly readable, useful and practical book that I thoroughly recommend.

Andrew Halfacre

You may click here to buy The 80/20 Principle. Or visit our books site for more ideas and recommendations.

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We hope you enjoyed this issue of CorporateCoach. If you would like to learn more about how we can work together, then please contact me, Richard Winfield