The 80ᚼ Pareto principle is based on Pareto's theory that 80% of the results one gets in a particular endeavour will be mainly due to 20% of areas to which one has applied efforts. In business this principle has been found to be true. Your data, properly converted into appropriate performance indicators, will show you where your largest margins come from. You can then channel more time and effort in that direction.
To elaborate further: A one_page Variable Costs Analysis report sheet automatically generated by the custom spreadsheet application I earlier described, was a powerful tool used by top management to quickly assess performances of individual breweries. Among other benefits, the report made it quite easy to realistically compare sister breweries in different locations(even across countries) based on common denominators. Apart from summarising brewing/packaging materials in two groups _
1. The Pareto Principle _ Using spreadsheet tracking, you can easily apply the Pareto principle in deciding which of your income sources and expense channels(i.e. products and services sales) to focus on in order to maximize profits. Considering that you are most likely to use the same marketing/sales resources to serve your customers, it only follows that if you focus on your biggest margin selling products/services, you will get increased profits at more or less the same cost.
Custom spreadsheet solutions which survive long after the developer has "left the scene", are often those which users accept because they discover it _ among other benefits _ makes their work quicker and easier to do. That is why the best person to develop such solutions tend to be one who works in that area, and is therefore familiar with the way the manual system operates. S/he would have an "insider's" perspective of the best way to introduce automation other users will readily adopt _ even as it solves the identified problem(s).
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