The Ubiquitous 80/20 Rule

An axiom of business management is that 80% of sales come from 20% of clients. But few of us notice the 80/20 rule reaching beyond the business world and deep into everyday life, from our typing (20% of the keys are tapped 80% of the time) to our wardrobes (20% of clothing gets 80% of usage), nothing seems immune from the phenomenon known as the Pareto Principle.

In 1896, Italian economist Vilfredo Pareto noticed that power and money tend to accrue in the hands of very few. This uneven distribution compelled him to investigate. In his findings, Pareto concluded that 80% of the land in Italy was owned by 20% of people, and that 80% of the wealth belonged to the top 20%. And not much has changed in 150 years. In the US, the top 20% of earners paid roughly 80% of federal income taxes in 2018.

At this point, you may wonder how this relates to Blue Collar. Well, surprise surprise, the Pareto Principle strikes again in the domain of WCB claims. According to WCB, some 80% of comp claims resolve on their own without complication. The balance of claims are termed ‘complex’, and you guessed it, these 20% are more expensive than the other 80% combined. And thus explains Blue Collar’s place reason for being—to prevent the 20% from becoming runaway costs.

Other examples of Pareto to share?

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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About Me

Ben Barfett, Principal and Consultant, has spent his life in the construction sector, specifically heavy civil, enviro, commercial, and energy. Having held senior roles in business development, technical advisory, and regional management, he earned his stripes in the field and in head office. Conscious of the interplay between commercial, legal, and execution aspects of construction, his business insights are informed by expertise in WCB policy and enhanced with disability-specific training. 

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Blue Collar Consulting

Blue Collar Consulting is a WCB and disability management firm. The company specializes in rapid and affordable disability solutions that advance current claims, contain the cost of future claims, and get injured workers back on their feet. 

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