(Pt.4/5) Natural Laws of Xsauce

The Pareto Principle

Welcome back to another week. It’s been a great April for us already. We’re making progress every day, but we aren’t in a rush. Yes, we’re super excited to show you months and months worth of tinkering, but we’re equally concerned with creating something that is considered and thoughtful.

Diamonds by @altitxde

We speak a lot about our process at Xsauce. It’s not because we have some secret formula to success, we just want to be real about the energy required to build something of value. We know there are so many brilliant minds out there, so we hope our knowledge, mistakes and reflections can help you unlock a path to your dreams.

On that note, let’s get into the next law — the Pareto Principle, otherwise known as the 80/20 Rule.

“Named for Italian polymath Vilfredo Pareto, who noticed that 80% of Italy’s land was owned by about 20% of its population, the Pareto Principle states that a small amount of some phenomenon causes a disproportionately large effect. The Pareto Principle is an example of a power-law type of statistical distribution — as distinguished from a traditional bell curve — and is demonstrated in various phenomena ranging from wealth to city populations to important human habits.”

If you look around you can find Pareto effects in nearly all aspects of life. It’s common that 20% of the assets in an investment portfolio will return 80% of the gains or that 20% of the players on a team account for 80% of the total team salary. These disproportional weights are a feature of systems, not a bug. This means that success, however you classify it, is often found in identifying what will provide a disproportionate return on your efforts NOT merely striving to do everything exceptionally well.

*NOTE : This isn’t an anti-intellectual stance, rather it’s about a “T Model” of knowledge and leveraging depth in a meaningful domain over a superficial or broad understanding.

This way of thinking is also linked to another law we haven’t covered — the Law of Diminishing Returns. This law states that there is a threshold in which more investment doesn’t yield better returns. For example, having five Masters degrees. One degree certainly has a profound impact on earning potential, two degrees provides measurably more value, but three and beyond and the the cost/time/effort versus reward becomes less favorable. It’s a crude example that doesn’t account for growing your network or other benefits of academia, but it is a simple analogy where you can see that additional effort doesn’t always translate to commensurate gains.

Pareto’s thinking directly translates into how we structure our time and energy at Xsauce. We put this law into practice by ruthlessly evaluating what’s critical and what is simply nice to have. It’s a necessary process of reducing the day down to a series of small but incredibly meaningful tasks. This practice ensures that the time spent will deliver impact. The ultimate objective is to identify the 20% of the 20% of the 20%. This gets us down to the ONE thing that’s most impactful. We lock in on that and burn the boats…

Conclusion.

Be intentional with how you spend that 20% of your time. Not everything will yield more than what you put into it, so it’s important to identify what really matters to you and where you want to go. It begins by asking yourself some questions like “will improving my speaking unlock more opportunities?” Or maybe it’s networking? Whatever the case, there’s an element of knowing your own “skill stack” and where you can naturally expand. Find that and harness your inner Pareto.

Culture is Ours.

Twitter|Telegram|Discord|Website

Legal Disclaimer: $SAUX tokens are not investments or investment contracts, nor should they be construed as such. Rather, the Xsauce ($SAUX) protocol tokens are a means of participating in a community-owned, -operated and -governed network protocol. Because the success of the protocol described depends on the efforts of a disparate group of actors, the products and services described herein involve substantial risk. Materials published by Xsauce do not constitute the provision of advisory services regarding investment, tax, legal, financial, accounting, consulting or any other related services, nor are they a recommendation being provided to buy, sell or purchase any product or service. Further, materials published by Xsauce reflect the information available as of the time of publishing and are subject to change at any time without notice. Xsauce will not be liable for any direct or consequential loss arising out of the use of this material or its contents.

--

--

Get the Medium app

A button that says 'Download on the App Store', and if clicked it will lead you to the iOS App store
A button that says 'Get it on, Google Play', and if clicked it will lead you to the Google Play store