Is The 80/20 Rule For Success A Real Rule?

Quote:

Originally Posted by JohnD

Unfortunately, the Pareto Principle has taken on a life of its own as being the "gospel" for any situation at any time. In other words, its been accepted as a rule of nature.

Let me ask you something, did 80% of the work around your home get done by 20% of the household when you were growing up? It didn't happen that way in my home. Mom cooked and cleaned. My brother and I did chores outside. Dad worked. Basically, we all chipped in.

The same thing could be said for the % of students working in the classes I've taken throughout my educational career. Almost no one wanted to fail. About half did better than average and the other half was about average. Sure, there were the superstars. But there were just as many on the bottom of the scale.

It's called a natural distribution in statistics, and THIS is more of a natural law than Pareto's principle. But hey, if it works for you then go for it. But you may end up leaving a lot of sales money on the table if you're only shooting for 20% of your market when law of averages says that about half can be "sold" given the right timing, message and persistence.

Just my two cents,

John "Rainmaker" Davis, Ph.D.

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Thank you for the delightful post Dr.

Quote:

Originally Posted by Wonderboy

Should it be always expected that over 80% of the sales comes from less than 20% of the sales staff (or some similar numbers)?

Early on I noticed that in every sales team I worked in, there was typically one sales person who outperformed everyone else in the team by a very significant margin. I often found the numbers more extreme than the 80:20 rule. I have seen situations in small sales teams (4-10 dedicated sales staff) where one sales person sold as much as the rest of the team put together.

Quote:

Originally Posted by Calvin

If the leads were good enough the salespeople wouldn't need to learn how to "sell" they could just let the customer "buy".

People who don't know how to sell always blame the leads. There are no bad leads, just bad sales attempts.

Any sale I loose is always my fault. If I loose the sale it just means I showed the customer the wrong item or didn't show them the benefits right or missed the opportunity to close or something.

Bad leads? Work harder.

Pat

Quote:

Originally Posted by Wonderboy

You've just described Sales Paradise.

Do you think this exists?

Quote:

Let me ask you something, did 80% of the work around your home get done by 20% of the household when you were growing up? It didn't happen that way in my home. Mom cooked and cleaned. My brother and I did chores outside. Dad worked. Basically, we all chipped in.

John--some could argue that the principle was indeed in effect at your household growing up, too. Your mom cooked and cleaned while you and your brother did outdoor chores while your dad worked. Each person is doing a different set of tasks. I see your point that it's maintaining the overall household you're viewing as the "job," but sales is just one part of a business just like each set of chores is to a household therefore the principle tends to apply to both situations.

I'd suggest that it averages out to 80/20. Whether that's fortunate or unfortunate is a matter of perspective I suppose.

To flip that around in your favor, figure out which 20% of your customers produce 80% of your income and target more of them instead of wasting time on the 80% that contribute only 20% of your income. That'll vault you into the top 20% within your company if you're not already there.

Quote:

People who don't know how to sell always blame the leads. There are no bad leads, just bad sales attempts.

Any sale I loose is always my fault. If I loose the sale it just means I showed the customer the wrong item or didn't show them the benefits right or missed the opportunity to close or something.

Bad leads? Work harder.

Pat

I disagree with this as most companies always bust out their nostalgia files thinking the reps who've just gone through training or just hired on will be able to magically flip these accounts around. Past leads are typically bad leads because the prospect has said "no" already so the rep is being asked to chase his/her tail.

It also depends where the leads come from and how they're distributed. Once a rep has established a reputation as a good rep, companies will distribute better (cherry picked) leads to that person because they feel as if that rep will stand a better chance of closing that lead versus someone who hasn't built their reputation yet.

If the rep is responsible for obtaining his/her own leads from the outset, I'd agree more with your statement. If the rep just isn't getting enough leads, they need help prospecting. If the rep doesn't find quality leads, they need help qualifying. If the rep doesn't close enough deals, they need help at the proposal level OR they need to learn to ask better questions to uncover more pain (qualifying again).

This is a primary reason to have a website separate from the company's to collect leads and share more information about the rep and their value add.

Quote:

Originally Posted by rogerbauer

I disagree with this as most companies always bust out their nostalgia files thinking the reps who've just gone through training or just hired on will be able to magically flip these accounts around. Past leads are typically bad leads because the prospect has said "no" already so the rep is being asked to chase his/her tail.

It also depends where the leads come from and how they're distributed. Once a rep has established a reputation as a good rep, companies will distribute better (cherry picked) leads to that person because they feel as if that rep will stand a better chance of closing that lead versus someone who hasn't built their reputation yet.

If the rep is responsible for obtaining his/her own leads from the outset, I'd agree more with your statement. If the rep just isn't getting enough leads, they need help prospecting. If the rep doesn't find quality leads, they need help qualifying. If the rep doesn't close enough deals, they need help at the proposal level OR they need to learn to ask better questions to uncover more pain (qualifying again).

This is a primary reason to have a website separate from the company's to collect leads and share more information about the rep and their value add.

Well said Roger,
Keep up the good comments

MAN THIS THREAD HAS CONFUSSED ME -

Is The 80/20 Rule For Success A Real Rule?

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