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Guest post by: Jay Conrad Levinson Become an Author

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There is a world of difference between efficiency and effectiveness, and it’s in that world that guerrillas flourish. They are well aware of the power and omnipresence of the 80/20 rule and have probably read Richard Koch’s book, "The 80/20 Principle" because even its subtitle -- "The Secret of Achieving More with Less" -- is guerrilla through and through. It dramatically emphasizes the effectiveness that can be gained by simplicity.

Alas, even guerrillas don’t hit the bullseye with all of their marketing, but at least they direct their energies towards learning which 20 percent of their marketing generates 80 percent of their sales. Just knowing this to be true is a compelling reason to learn where each of your customers learned of your existence, to recognize that all customers are not created equal and that 20 percent of them most likely account for 80 percent of your profits.

The 80/20 rule teaches you simplicity and applies to more of your business than marketing and more of your life than business:

80 percent of what you achieve at work comes from 20 percent of the time you spend working.
20 percent of a company’s products usually account for 80 percent of its sales.
And 20 percent of its employees contribute to 80 percent of profits.
20 percent of criminals account for 80 percent of crimes.
20 percent of motorists cause 80 percent of accidents.
20 percent of your carpets get 80 percent of the wear.
20 percent of your clothes will be worn 80 percent of the time.
80 percent of traffic jams occur on 20 percent of the roads.
20 percent of computer users purchase 80 percent of software.
Your job? To find out which 20 percent of your marketing is motivating the most sales, to determine which 20 percent of your customers are producing 80 percent of your profits, to learn which 20 percent of your prospects are most likely to become customers.

One of the most fascinating definitions of entrepreneur comes to us from the French economist J-B Say, who coined the word, and said "the entrepreneur shifts economic resources out of an area of lower productivity into an area of higher productivity and yield."

The underlying meaning of that definition and 80/20 rule is that there’s a whole lot of wasted money and energy in life. The goals of the guerrilla are first to identify the area of lower productivity and then to do something about it, then identify the area of higher productivity and do something about it. It’s the doing something about it that determines the real winners.

The actions you take to eliminate waste and double up on effectiveness may make you seem unreasonable. So take comfort in George Bernard Shaw’s words: "The reasonable man adapts himself to the world. The unreasonable one persists in trying to adapt the world to himself. Therefore all progress depends on the unreasonable man."

When you discover which 20 percent of your customers are responsible for 80 percent of your sales, focus on keeping them happy, increase the amount of business you do with them, and tap them for their referral power because these are obviously satisfied customers. Paying more attention to them reduces your marketing budget because you can pay less attention to the 80 percent who motivate 20 percent of your profits.

Once you mind has absorbed the full implications of the 80/20 rule, consider applying it in other ways: celebrate exceptional productivity rather than raising average efforts. Look for short cuts. Be selective more than exhaustive. Delegate and outsource as much as possible. Target a limited number of goals and focus like a laser beam upon them.

Because you’re a guerrilla, don’t do any of these things in a hurry. Patience will enable you to spot the areas that need changing, then to implement the changes so that humanity remains part of your modus operandi. Fast isn’t beautiful. Big isn’t beautiful. Small isn’t beautiful. It’s simple that is most beautiful if you’re an 80/20 kind of guerrilla.

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