Achieve More With Pareto's Law by Sobaca

Author:Sobaca
Language: eng
Format: epub
Tags: pareto, 80, 20, achieve, time management, time, success, business, finance, help, self help, 80 20, efficiency
ISBN: 9781907290237
Publisher: Andrews UK Limited 2010
Published: 2010-08-01T00:00:00+00:00

Salaries and pay

An 80/20 mindset will help you realise a few important facts relating to salaries and pay.

Let’s begin discussing this topic by looking at an imaginary company that employs 100 people who all receive the same pay. We can safely assume that a few of them will be more productive than average and that a few will be less productive, much like you might find in a classroom of students where some are above average and some below average. In our company, however, what this implies is that, because they all get paid the same, each worker’s output is valued and consequently rewarded the same. This means that those who work hard and produce above the average are actually being underpaid and losing out while those who produce less than the average are in fact being overpaid. In this example, if you are an exceptional worker, you don’t get paid accordingly.

You will also be aware that in any company there are a few at the top who take a disproportionate amount of salary in relation to what they do. Take a firm of lawyers as an example. The total amount of the fees earned will have come from all the lawyers, yet the partners of the firm, who are only a small number of the total lawyers, will take a larger slice of the pie. This is the 80/20 principle at work. They are benefiting from the work of everyone else. They are the winners in this 80/20 example because they contribute 20% to the earnings but take 80% of the total salaries paid. The simple explanation for this is that they have ownership of the company. This is crucial to understand. Ownership allows the owners to benefit disproportionately from the efforts of their employees.

If making money is your sole focus then the 80/20 mindset will confirm that this is difficult to achieve simply by climbing up the corporate ladder. The system of promotions and techniques of team bonding are actually of more use to the owners of a business than they are to the employees. The reason for this is that they are really just tools designed to keep otherwise talented individuals tied to a company. It is also common practice for companies to use promotions as a substitute for salary increases. This has the added benefit to the owners of allowing more company profits to flow to them.

Of course not everyone should want or try to be a partner in a law firm or the owner of a business. The point is that if your target is to earn more money, then you need to clearly understand how the system works and then choose the right path for you, one that suits you and one where you get to be on the right side of the 80/20 principle.

We are looking to use our 80/20 mindset to enable us to magnify and enhance whatever we find is contributing the most to any success we have or have had.

If you are fulfilled in the workplace then you are one of the few lucky ones.

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