Episode 143

Episode 143: MVP – The 80/20 Rule

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What you’ll learn in this episode:

Creating more impact, and driving more of the results you want, while not increasing the amount of input is every entrepreneur’s dream.

The good news is, according to the 80/20 rule (or Pareto’s Principle) there is a subset, a vital few, that create most of the results in your business.

Today we’re going to break down the 80/20 rule and talk about how it applies to your business, and how you can use it to your advantage to create increased results, momentum, and money in your business.

After listening to this episode, you will understand how to get clear on the things that are drive most of the results you’re creating and how to keep up that momentum and increase your output starting today.

In this episode, you will learn to:

  • There are five key steps every business owner needs to work through to have their desired work schedule this summer and keep money coming in. 
  • You do not need to trade more of your time to make more money.
  • The more that you can honor your boundaries and your commitments that you make to yourself (including to have the summer you want and making the money you want), the more successful you will be
  • Discover a way that you can take everything you’ve learned today and dive deeper to take your results to the next level right now.

Mentioned in this episode:

Todd Herman

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[00:02]  Well, hello, everyone. And welcome back to the practical mindset Podcast. I’m Jess Miller. And I’m so excited to be here today to talk to you about the 80/20 rule. If you’re an entrepreneur and you’re listening to this podcast, I am sure you have probably heard the 80/20 rule thrown around in all sorts of contexts. A lot of times we hear it related to marketing, where 20% of the content that we create are things that we input into our, you know, business, create 80% of the results.

[00:32] And so today, I want to talk to you about the 80/20 principle, which is also known as Pareto principle. And I want to talk to you about what it is, how does it impact your business? And how can you use it to your advantage to have a bigger impact in what you do, and the results that you create? So first of all, what is the 8020 rule? What is this thing that we call Pareto principle. So Pareto’s Principle, or the 80/20 rule states that for many outcomes, roughly 80% of those outcomes or consequences come from 20% of the causes. So that essentially means that 20% of what you’re inputting or 20% of the total, creates 80% of the outcomes. And so when we think about that related to business, that means for us in our businesses that 20% of the things that we’re doing 20% of the inputs that we’re putting in 20% of the causes, or the pieces of our business that we are touching, are creating 80% of our outcomes.

[01:43] And why is this important to us, because if you want to create more impact in your business, if you want to get more results in your business with less input, or less effort, you need to know and focus on the things in your business that create the biggest results, the most results. In parados principle, these 20% of causes are also referred to as the vital few. I love this law. And I love the concept of this because in the coaching that I do, and in my business, when I look to create results, I’m always looking for those things that have the most potency. That is one of the things with my business that I think differentiates the work that I do from other business coaches is that I am really looking to help people optimize their business around the pieces that have the biggest potency, or as my coach Todd Herman would say, have the most transference. It’s those things in your business, that touch the most other things in your business that create the biggest results.

[02:49] And I believe that in your business, one of the things and I’ve talked about this a lot on the podcast, that creates major results, that creates consistent income and a thriving business is something like your magnetic offer. It’s one of those things that is really integral and vital to your business in order to create the outcomes that you want. And for many people, one of the most vital outcomes for them is consistent income. And so I believe that the your offer is one of the vital few things in your business that create major consequences. So if you want to create more of that impact, and you want to do that with less input, then you really need to understand what those vital few are what that 20% is in your business, so that you can really dial into that and dial it up. So when we look at our business, there are a variety of things that we do in our business every day. And the question that would really beg from this concept is which one of those things are your vital few? And so the question I want to pose to all of you is, do you know what your 20% is? Do you know what your vital few are? Do you know what those things are that are creating 80% of your consequences in your business 80% of your outcomes, whether that is the money that you’re making the clients that you’re bringing in the exposure that you have the opt ins, whatever it is, do you know what’s driving it? And for many people, I must say that the answer often is no, they don’t.

[04:35] And I’ve talked about this on the podcast before about how when I think about a business model, there are pieces of that solid foundation that need to be built in a business in order for it to thrive. Those things in my world are this. There are the things in your business on one side that you can’t hold in your hand. It’s those intangible things but they are things that are so important for the vital success of Your business, like your mindset, your energy, the way that you show up your intention, all those things that even some you would say, are a little woowoo. But they’re the things that are intangible that are, are part of that foundation that’s on one side of the equation.

[05:18] On the other side of the equation are the more tangible things. They are the logistics, the tactics, your business plan, those things that are more tangible, that you can hold in your hand that are absolutely necessary for you to have a business that thrives underneath those intangible and tangible things, is the data. And that data allows you to get really specific and see what is working in your business, what in tangible or tangible things are creating the outcomes that you want. The interesting thing about this is that most of us don’t really look at our analytics enough, we’re not looking at the data enough to see what it’s telling us. And unfortunately for this is that the things that we assume, or what we think is happening is often inaccurate. So either we are overestimating what something is doing or what we think it’s doing. And that often happens, we think something is doing better than it is we think something is, for instance, driving our traffic when it isn’t. We’re overestimating what’s going on there. And when it comes to our internal world, what we are capable of, we often underestimate that to a large extent. Either way, it’s not accurate.

[06:37] And so that data underneath that real bedrock of your business, that foundation is so crucial to know if you are on solid ground. And but most people, they don’t look at that data. So when I asked the question, do you know what your 20% is? Many people don’t. So the first thing I want to offer to you is, go find out what is going on with your data, find out what things are working in your business. Okay, that’s the first thing. The second piece is if we just take the results and the analytics out of it, and we just think about the the logistics of our business, and the things that we do every day. The question would be what things fall into the 80% category as a general rule, and what fall into the 20% category. Because there on one hand, you want to see what you’re doing and how that is showing up. So looking at the things that you’re doing, and figuring out what your 20% are. But you also want to understand generally, what are the things that move the needle in businesses in general.

[07:47] And so the next thing is for us to look at what things in businesses really have the biggest impact. Now, I just want to say that it doesn’t mean that the other things are not important. We’re not saying that. We’re just saying, when we think about the things in our businesses that move the needle the most, there are certain things that really drive that engine really create results, I would say consistently, regardless of business. And those 20% are the things that whether you have them or not, you want to try to incorporate doing more of those things, because they will move the needle for your business the most. So if we start with the 80%, what are those things in your business that you likely spend a lot of time on, but maybe have little impact or little results, less results? I would say some of the things that I see business owners do that would fall into the 80% category are things like quote unquote, research, scrolling, social media, spinning and indecision, reinventing the wheel, recreating content you’ve already created over and over again, having processes that are not streamlined. So there’s a lot of inefficiencies in your business, having a lack of clarity around where you want to go and what you want to produce, spinning in a lot of mind drama so that you’re not making any headway. Those to me are examples of things that take up a lot of your time, but don’t create a lot of results in your business.

[09:24] Again, not saying that they don’t create any results. But as far as the best use of your time and a place to invest in I would say those 80% are not the place. On the other side of the coin is the 20% that do have a huge impact. So for what I see in my own business and in the business of my clients, things like meeting new people, posting new and valuable content that your ideal customers can consume, giving tons of value no matter where you show up paid or unpaid reusing content So leveraging all of that content that you’ve used, making offers, telling people who you are and what you do. So talking about your business, telling people how you solve their problems, and how you can help them. So those are just a few examples of things in your business, that I would say are the vital few. Those are the things where if you invest the time, regardless of your business, regardless of your niche, you’re going to have a big impact on the outcomes, a big impact on bringing more clients in on making more money on being more visible on offering more value, right? All those things are things that really move the needle in your business. So how can you use this to your advantage? Well, from my perspective, I think if we are looking to invest our time and energy, and money in our business, to create bigger outcomes, and we want to do this in a way that’s strategic and use it to our advantage.

[11:01] My contention is that you take your time, energy and money, and you put it toward the things that are your vital few in your business, you really get this is where we come in with this idea of constrained, you really get sort of critical and constrain around those things that have the biggest impact. And how can you really channel your resources towards those things, and dial down the stuff that isn’t moving the needle? The same. And so in my world, what I say a lot is that success is a game of subtraction. It’s a game of constraint. And it’s really a matter of getting clear about what you want to produce and where you want to go. And then really focusing in on that and getting rid of the other stuff that is not moving the needle for you. And it’s not in the adding more, it’s in the getting very specific around the things that matter. And doing those things more and doing them smarter. That is where this idea of working smarter, not harder comes from, because when you get clear on your vital few. And when you allocate your resources to those things, you will produce much more while still holding the input constant. That is the sort of definition of potency is when you do something the same thing.

[12:30] So you’re putting out the same amount of effort, you’re putting in the same amount of resources, but you are getting more double triple out of the equation than you put into it. So using this to your advantage, meaning getting clear on your vital few and then maneuvering around those things in your business to create bigger outcomes is the way that you grow quickly. And so what how would this look in your business? What’s an example of this? One of the best examples I can give is I had a client who was building her business, and she was looking for clients, he was trying to find out where these people were. And what she was doing was she happened to be on social media quite a bit. And she was showing up in a lot of groups. And she was doing a lot of things posting all the time, tons and tons and tons of content. And it was great content. But she wasn’t understanding why she wasn’t grading gaining any traction. And when we started to look at her numbers and her data, what we started to see was she was showing up in a lot of places. But she wasn’t going deep anywhere. And in the places in the groups where she was having the biggest impact. She wasn’t allotting any more time and energy to those groups. But once she figured out which ones were producing for her, and she started to focus more of her time there,

[13:58] her impact grew exponentially. People started to know who she was, they expected to see her showing up there. They caught on to her marketing and branding, because they were hearing it all the time. When it was time for her to make an offer. She could show it or share it in that group. And they already knew her and that like and trust factor was already there until the momentum that kicked up even with her paid offers after that was so much bigger than before. So it is really important to figure out where are you seeing those results? And where can you dial those things in to create bigger outcomes.

[14:39] So as I mentioned, if you want to create more impact, get more results in your business with less inputs or effort. You need to know and focus on the things in your business that create the most results. You need to consider. Pareto principle you need to think about the 8020 rule. This is a rule that is not special For anybody, it is something that we see sort of universally across the board. And so even outside of business, we they look at all different types of things like, you know, retail sales produced by 20% of store brands, or even down to like family problems and issues like 20% of, you know, issues in families cause 80% of the problems, this is a universal thing. So you want to make sure that you understand this and that you go into your business and you look at what are your 8020 distribution? What are those things in your business that are working? What are those 20%? Vital Few? And how can you double down on those and do those things more and focus those things on those things more, so that it creates bigger results, while constraining while focusing in because that is really the way that you work smarter, and not harder to create all the results and the things in your business that you want.

[16:02] If you’re someone who wants to create a bigger impact in your business, who is looking to really work smarter and not harder to dial in on the things that they’re in their business that make the biggest impact, create the biggest results and bring in the most clients in their business. I invite you to apply for the 10K Accelerator program. Doors are open now. We only open the accelerator 4x per year, and we are ready to welcome you in to join us and help you optimize your business to create the things and the money in your business that you want.

[16:38] If you’re interested in applying, go to the show notes, click on the link and fill out an application now. We start mid-July, and there are only a limited number of seats because it’s a very high touch program. And we make sure that the people that come in, get results. So head to the show notes click on the link and apply for the 10K Accelerator now and get ready to be creating all the results in your business that you want and more.

ed to be here today to talk to you about summertime. What do you want to do this summer? Are you excited that it is right around the corner? I know I am. I love the change in the seasons. And I love the freedom that summer sort of brings with it. And it’s feel and it’s, you know, the way that we design it. And I love talking to people about how to optimize their business around the things that they want to do, especially around their summer. If you’re someone who has children, or maybe you work in an industry where things tend to sort of dial down a little bit in the summertime, you are one of these people who has this opening of your schedule or this change in your schedule that allows you to think about your time and your business differently. And how do you want to construct this, to really make your heart sing to do all the things that summer has to offer, while also maintaining your business, your sanity and your momentum. There is this horrible like rhetoric out there that we need to be sacrificing all the things in our life that we enjoy, to make money in our business, and that we need to be working all the time to do it. And that is just not true. And so many of you who have been listening to the podcast have heard me talk about this topic in some fashion, you know, before in other ways. But today, I’m going to talk to you about how you can work 20 hours this summer, and make bank and I mean that you can work the hours that you want to and make money. As long as you follow these five things I’m about to share with you today. Many people walk through, especially this time in the early June timeframe. They walk around, almost like dreading like what am I going to do this summer, when my schedule is changing, or my kids are going to be home and I need to work my business. And they get this sense of dread, they need to trade off one thing for the other. Well, I’m here to offer that if you want to work 20 hours or fill in the blank number of hours this summer and make money, you need to have a clear plan and a clear vision about what it is that you want to create and how you’re going to get there. And so today, we’re going to talk about this. And this is going to be a little bit rapid fire. So get out your pencils and your pens and your notebooks because we’re going to just jump right into it.

[02:39] So number one, the first thing that you need to do, if you want to change your schedule this summer, and for the sake of this podcast, I’m going to use 20 hours. If you want to work 20 hours this summer, and make bank the first thing that you need to do is you need to get clear on what you want your summer, your weeks to look like. Okay, I think you have probably heard me say this about a gazillion times on this podcast. But one of the most important things you could ever do in your business in your life in anything, any goal you said, anything you ever want to do, is you need to get clear. And I have always been a proponent of you need to start with the end in mind. Where do you want to go? What is the final thing that you actually want? So again, for this example, you’re going to navigate into your summer thinking about 20 hours a week. Okay? So you want to work 20 hours a week? And you’re going to get clear on what does that look like for you? Does it mean? I’m going to work four hours a day for five days? Does it look like maybe I want to take my Friday’s off? Does it look like I want to work only three days? Is that Monday through Wednesday? Is it Tuesday through Thursday? What do you want your summer and your weeks to look like? Okay, in this example, I’m going to pretend that we decided that we’re only working Tuesday through Thursday. And I will share with all of you that my work week consists of really putting the bulk of my work is especially externally facing work into those three days of my week into my Tuesday through Thursday. So for the sake of this example, we’re gonna say 20 hours a week, Tuesday through Thursday, and we’re gonna work you know, six hours each day, six and a half hours each day. So to get us to around that 20 hours number, okay, so six and a half hours each day, seven hours each day, which would look like nine to four each day. 9am to 4pm each day. Okay, so first, what do you want your summer to look like? Get clear for this example. We’re gonna do Tuesday through Thursday. We’re going to do nine to four. Okay.

[04:52] The second thing is, you need to block your time and schedule in the priorities or the meetings or the thing They are non negotiable. Okay? So going to our example, that would mean that I’m going to go in, and I am going to block everything before nine o’clock in the morning, and everything after 4pm In the afternoon, on Tuesday, Wednesday, Thursday, then I’m going to also go and block my Monday and Friday, because we’re only working nine to four, Tuesday through Thursday. So I’d go in and block that time. The next thing I would do is I would start scheduling in the things that need to be scheduled, starting with the priorities. So if any of you have ever listened to Stephen Covey’s Seven Habits of Highly Effective People, he talks about this idea of big rocks and little rocks, I would schedule in these big rocks. So what does that look like for you? What are the priorities in your life? What is the priority? I always start with my personal life? What are the things that are non negotiable? That might need to go into that timeframe? Do my kids need to get picked up at a certain time? Is there a camp? Is there something that’s happening around my house that needs to happen on one of those days? What are those big rocks that are the priority in my personal life, schedule those in, and then I do that for my business, those big rocks, I also then go to what needs to happen on those days to keep my business going. So meetings with clients, my accelerator group, if there’s some sort of personal development that I’m doing, I would schedule those in next. And so I would get really specific on what needs to go where how long it’s going to take, and what is going to need to be in there first. Now here’s what I want to say as a caveat, some of you might have your brain going wait, but what if it doesn’t, you know, I’ll fit in there. So if we just use this example, right now, we’re working 20 hours a week, and we’re going to work Tuesday through Thursday. If you schedule your time, from nine to four, you’re actually over your 20 hours, right, you’re over your 20 hours is actually 21 hours. And so I would recommend doing that. Because if something needs to shift, or don’t tweak or spill over, you’ve got a tiny little bit of padding. And you could also, if there was going to be an exception to the rule. And we’ll get through this, too. We’ll get to this in the next steps. Like, is there an overflow spot where you could put that person, so maybe it would be like, for very extenuating circumstances, I’m going to schedule a call at 430 on Tuesday, as an example. So there’s some like wiggle room in that, because let’s face it, life happens. You we have no control over certain things. So giving that little bit of flex is really important. But you want to block your time, and you want to schedule in your priorities, and then you sprinkle in the other things. Okay?

[07:55] Third, is you need to communicate your plan your intentions to the people that you need to communicate with, maybe it’s your clients, maybe it’s vendors that you’ve been working with, where you’re saying, hey, come June 25, I’m making this up, you, we’re going to be switching our schedule to look like this. And here’s what that means for you. And here’s how we’re going to accommodate you. And here’s how we’re going to make sure we’re continuing to move forward, do the things that we need to do. And we want to explain that to you. And here’s why that’s really great for you. And this is crucial. You want to always put your, your perspective in the mind of the person you’re talking to. So when you tell them this, what are they going to care about? Why is this important to them? Why do they care about it? And why is this a good thing for them? And why is it going to be okay? So you want to communicate this, and you want to make sure that you can explain to people how these pieces are fitting together and why it’s okay or a good thing for them or why it’s going to be fine, that you’re basically saying to them, you can trust me, I’m a serious business owner, I am focused on, you know, moving things forward. And here’s how I’m going to do it. And for some of you, depending on who your clients are, you can share with them your why, why are you doing this, you could say I’ve always wanted to spend, you know, more time with my kids in the summer, I wanted to really prioritize my health and I don’t want to be working around the clock all the time, or it’s been a really long year in COVID. And we’re finally getting to come out of it. And this is why I’m doing this. But rest assured that you are a priority for me. And we are taking all the measures to make sure that what we agreed to were doing, for example, so always think of that person in that communication process when you’re communicating this and make sure that you do communicate, don’t just, you know, change things and nobody knows and no one says anything and then it gets really discombobulated. So you want to make sure you communicate to people that you need to communicate with what you’re doing, what your plan is, and what your schedule looks like.

[09:52] The fourth thing is you need to hold your boundaries. You need to really double down on why are you doing this? What was that summer that you fleshed out that you had that vision of in the first step of this podcast. And you need to hold yourself and remind yourself as to why you’re doing this when your boundaries get pushed. Because as I mentioned earlier, it is almost inevitable that life happens and certain things push on other things. And it’s very easy to be like, oh, you know what, I’ll just work until eight o’clock at night. What you really want to do is you want to double down on why are you doing this? What does it mean for you? How have you set yourself up for success and put in the structure to create those results and be successful, that you can lean on and now support yourself. And I really do believe that the more that we can stay true and honor our boundaries and the commitments that we make to ourselves, the more successful we will be. And I’m going to repeat that the more that you can honor, your boundaries and your commitments that you make to yourself, the more successful you will be, the road to your dream is paved with a bunch of choices that you make in service to the person and the life you want to become. It is in those tiny steps in those moments where we decide to hold our boundaries, to not blow through our boundaries to honor what it is that we said we were going to do, and stay fast on that path to where we want to go that long term goal. It’s in those moments that we cast a vote for our future self, and our future life. And so it’s really important that you honor those boundaries, you hold those boundaries.

[11:45] And number five, which is last but not least, is that you have a support system that helps to move you through this, that knows your desires, that knows what you have set up, that is going to be there to help you tweak it and navigate through it and cheer you on when you’re doing it, that you can send those pictures and those selfies from the beach this summer, or from the time that you’re spending with your children, or when you’re sitting in bed with your cup of coffee because you got to sleep in, or that bestie trip that you’re taking with your girlfriends or significant others that you got to take because you honored your schedule, and you are able to make your work work for you versus the other way around. And so that support network is really, really important. Can you do it alone? Yes. Will it be as fun and as easy? No, I promise you, you want to surround yourself with the people who I say this all the time, they get it and they get you. And you want to make sure that you have a guide and people around you that have gone before you and done this that can help save you so much time and energy and frankly, Saturday by sharing their best practices with you, and helping you move toward your dream of your summer and these weeks and that cadence that you really want. So you need to support yourself with those people who get it and get you.

[13:06] So in summary, number one, get clear on what you want your week to look like. If you want to have a summer where you’re working 20 hours per week and making bank the summer where you’re not sacrificing your profits, your business growth, your momentum for your joy, you need to follow these five steps. So again, one, get clear on what you want your week and your summer to look like and reverse engineer that.

[13:32] Once you get clear on that. You want to to block your time and schedule in your priorities. As I mentioned your big rocks, start with your personal priorities first, and then your business priorities and make sure that you get creative on how do you get those on your schedule within the timeframes that you want to be working within those 20 hours. Number three, communicate to the people you need to communicate with. Make sure you let people know how your schedule is changing why this is really important for them how it’s going to be better, why you’re so excited to do this. Let people into your world and communicate I think over communicating is key. It’s okay if you say it more than once to okay, if you tell them a lot of stuff, your clients and your comrades are really going to appreciate that. And they’re going to know exactly how to work with you and exactly what you’re doing so that it’s the best of all worlds. Number four is once you decide all that, you need to hold your boundaries, you need to have your own back. You need to make sure that you honor your boundaries and the things that you committed to. It is so important that we really have our own backs. And as I mentioned, every time you do this every time you honor your boundaries and honor the decisions that you made, you cast a vote for your future self and the future life that you want, because those dreams and that future is made one decision At a time, it’s those tiny steps. It’s those moments where you decide not to blow through your boundary, you decide to honor the decision that you made and honor what you’re doing in that time where you’re not working, for example, that really brings you down that path to success and things that you want. And five is you want to surround yourself with a support structure, you want to be with those people that are cheering you on, you want to be with those people that can help you navigate through it and support you, when you hit those bumps or when you’re questioning those boundaries.

[15:33] Or when your mind drama shows up and tells you that you can’t do it in 20 hours, when actually you can and you have a whole plan that you planned out, and that you’re surrounded also with the people that can help guide you, they can share their expertise, they can tell you how to do this in a way that saves you tons of time and money and sanity. So you don’t have to figure this all out on your own, you can actually save that time and put it into the things that really matter the most for you. And in this case, it is putting that time and energy into your most incredible summer into that time, both within the 20 hours where you are setting those boundaries. And you’re setting the intention of putting all that energy into your business. And also in the time where you are outside of that time and you’re putting your time and energy into other things. I promise you that you will come out of going through this exercise, feeling amazing getting so much energy, and frankly getting so much more done in your amazing summer in 20 weeks than you ever imagined, while still making all the money that you want.