Eighty-twenty rule

The eighty-twenty rule states that twenty percent of the causes drive eighty percent of the outcomes. The rule applies to many situations in business, such as 20% of all payroll errors cause 80% of the total number of errors, and 20% of all customers generate 80% of all sales. The rule is used to focus attention on those few core causes that drive most of the results of a business. The eighty-twenty rule is also known as the Pareto principle.

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