The 80/20 Principle: The Secret of Achieving More With Less Read Online Free Page A

because of positive and negative feedback loops that causes do not have equal results. Yet it also seems to be true that powerful positive feedback loops only affect a small minority of the inputs. This helps to explain why those small minority of inputs can exert so much influence.
    We can see positive feedback loops operating in many areas, explaining how it is that we typically end up with 80/20 rather than 50/50 relationships between populations. For example, the rich get richer, not just (or mainly) because of superior abilities, but because riches beget riches. A similar phenomenon exists with goldfish in a pond. Even if you start with goldfish almost exactly the same size, those that are slightly bigger become very much bigger, because, even with only slight initial advantages in stronger propulsion and larger mouths, they are able to capture and gobble up disproportionate amounts of food.
    The tipping point
     
    Related to the idea of feedback loops is the concept of the tipping point. Up to a certain point, a new force—whether it is a new product, a disease, a new rock group, or a new social habit such as jogging or roller blading—finds it difficult to make headway. A great deal of effort generates little by way of results. At this point many pioneers give up. But if the new force persists and can cross a certain invisible line, a small amount of additional effort can reap huge returns. This invisible line is the tipping point.
    The concept comes from the principles of epidemic theory. The tipping point is “the point at which an ordinary and stable phenomenon—a low-level flu outbreak—can turn into a public-health crisis,” 10 because of the number of people who are infected and can therefore infect others. And since the behavior of epidemics is nonlinear and they don’t behave in the way we expect, “small changes—like bringing new infections down to thirty thousand from forty thousand—can have huge effects…It all depends when and how the changes are made.” 11
    First come, best served
     
    Chaos theory advocates “sensitive dependence on initial conditions” 12 —what happens first, even something ostensibly trivial, can have a disproportionate effect. This resonates with, and helps to explain, the 80/20 Principle. The latter states that a minority of causes exert a majority of effects. One limitation of the 80/20 Principle, taken in isolation, is that it always represents a snapshot of what is true now (or, more precisely, in the very recent past when the snapshot was taken). This is where chaos theory’s doctrine of sensitive dependence on initial conditions is helpful. A small lead early on can turn into a larger lead or a dominant position later on, until equilibrium is disturbed and another small force then exerts a disproportionate influence.
    A firm that, in the early stages of a market, provides a product that is 10 percent better than its rivals may end up with a 100 or 200 percent greater market share, even if the rivals later provide a better product. In the early days of motoring, if 51 percent of drivers or countries decide to drive on the right rather than the left side of the road, this will tend to become the norm for nearly 100 percent of road users. In the early days of using a circular clock, if 51 percent of clocks go what we now call “clockwise” rather than “counterclockwise,” this convention will become dominant, although clocks could just as logically have moved to the left. In fact, the clock over Florence cathedral moves counterclockwise and shows 24 hours. 13 Soon after 1442 when the cathedral was built, the authorities and clockmakers standardized on a 12-hour, “clockwise” clock, because the majority of clocks had those features. Yet if 51 percent of clocks had ever been like the clock over Florence cathedral, we would now be reading a 24-hour clock backwards.
    These observations regarding sensitive dependence on initial conditions do not exactly