80/20 rule

Also known as the Pareto principle, the law of maldistribution, the law of the vital few and the principle of factor sparsity, the vital few and the trivial many, the 80/20 rule states that for many phenomena, 80% of the consequences stem from 20% of the causes. The principle was first suggested by management thinker Joseph M. Juran, who named it after the Italian economist Vilfredo Pareto, who observed that 80% of income in Italy was received by 20% of the Italian population.

This principle was used in Library and Information Science (LIS) by Richard Trueswell in 1969. According to this principle one can observe that 80% of transactions in a firm is affecting 20% of the articles of that firm. In a library and information science context this principle means that about 80% of the circulation of books and other documents affects 20% of the holdings in that library. This rule has been applied to identify the "core documents" of libraries.

Burrell (1985) find that Trueswell's data are defective and concludes, among other things, that the timeframe used to make the investigation (circulation per unit) is decisive for the result. Soyibo (1988) interprets the 80/20 rule as a statistical distribution which is useful for the study of elitism, for example, very productive authors.

Watters (1992) does not mention the 80/20 rule but (on page 152) a "90-10" rule implying that in very large amounts of data it is necessary to provide 9 times as many data into the computer memory compared to the amount of data necessary to answer the question. This put limits on the speed with which data are retrieved.

"Also known as the 80/20 rule, the Pareto Principle separates a class of significant few from the trivial many. With this classification, Pareto Principle has managerial and strategic implications in many disciplines" (Chen; Chong & Chen, 2001, p. 1).

"Throughout the last hundred years, several economic theories have emerged which attempted to help clarify and categorize methods for dealing with the increased complexities in business. Although the Pareto Principle was formulated around 1897, its importance was not recognized until after World War II [10]. The Pareto Principle states that approximately 80% of wealth was concentrated in the hands of about 20% of a population. This 80/20 phenomenon has been reported in many kinds of human activities. For example, in libraries 80% of circulation involves only 20% of holdings. Similarly, 80% of computer usage involves only 20% of resources [9]. The 80/20 measure should not be considered an exact ratio. It is used heuristically to separate the —significant few“ from the —trivial many“ " (Chong & DeVries, 2003).

Literature:

Burrell, Q. L. (1985). The 80/20 rule: Library lore or statistical law? Journal of Documentation, 41(1), 24-39.

Chen, J. C.-H.; Chong, P. P. & Chen, Y.-S. (2001). Decision Criteria Consolidation: A Theoretical Foundation of Pareto Principle to Porter's Competitive Forces. Journal of Organizational Computing and Electronic Commerce, 11(1), 1-14. (doi:10.1207/S15327744JOCE1101_01).

Chen, Y. S.; Chong, P. P. & Tong, M. Y. (1993). Theoretical foundation of the 80/20 Rule. Scientometrics, 28(2), 183–204.

Chong, P. P. and DeVries, P. (2003). The Pareto Principle: The Phenomena, Theory, and Applications. Proceedings of the Western Decision Sciences Institute, April 15-19, 2003, Island of Kauai, HI, pp. 505-508. Available at: http://64.233.183.104/search?q=cache:rGS1BwYbiWgJ:www.sbaer.uca.edu/Research/2003/WDSI/pdffiles/papers/399.pdf++%22theoretical+foundation+of+the+80/20+Rule%22&hl=da

Koch, R. (2004). Das 80/20-Prinzip. Mehr Erfolg mit weniger Aufwand. 2 aufl. Frankfurt am Main: Campus Verlag

Soyibo, A. (1988). On the categorization, exactness and probable utility of bibliometric laws and their extensions. Journal of information science,14(4), 243-251.

Trueswell, R. (1969). Some behavioral patterns of library users. The 80/20 rule. Wilson Library Bulletin, 46, 458-461.

Watters, C. (1992). Dictionary of Information Science and Technology. Boston: Academic Press.

Wikipedia. The free encyclopedia. (2006). Pareto principle. http://en.wikipedia.org/wiki/Pareto_Principle

See also: Scattering (Bradford's law)