What that guy says, and most of the posts here say, are not correct, IMO.<p>20% of the customers pay 80% of the revenue.<p>You can't just willy-nilly cut <i>any</i> 80%.<p>You have to look at the actual sales per customer and only then cut the 80% that are time wasters.<p>If you have 1000 engineers, you MUST know which <i>specific</i> engineers are the 200 that are delivering 80% of the results.<p>If you have 200 salespeople, you have to know which exact and specific 40 salespeople you keep and the 160 that you fire.<p>.<p>But the problem in many companies that suck, or it was a good company and now it sucks, is that <i>generally</i>, the best employees, the 20%, have the most options. If they get too much problems, those 20% will be the first out the door. So the company starts getting into a death spiral. As more of the top 20% leave, that means the remaining top 20% will have to do the work of the ones that left. And soon they will say no way and they will quit, until all that is left is the 80% that does 20% of the work.<p>I have nothing against the 80/20 heuristic, but like most things, you better know exactly what you're talking about.<p>Also, in any company, <i>every</i> company, top management should know exactly who the best employees are, and treat them way better than anyone else. You bend over backwards for them. You do not treat all employees equally. It is an utter disaster to lose a golden goose employee, in <i>any</i> capacity, a top 20% receptionist, a top 20% janitor - doesn't matter. All top 20%-ers are top 20%-ers. Bend over backwards to keep your top 20% janitor if you have 100 janitors because you have a really really big building, treat the 20% top priority - get the CEO to talk the top 20% janitor if needed. If nothing else, it is good corporate self-discipline. Because the more top 20's you have in every area, they all feed off of each other's energy.