One formulation of the Pareto principle is that with 20% of the work you get 80% of the benefit, and it takes the remaining 80% of the work to get the remaining 20% benefit.
This makes it sound like we should stop after the first 20% of work. But we can apply the Pareto principle recursively to the remaining work and benefit.
In the second iteration, with 20% * 80% of the work, you get 80% * 20% of the benefit. In other words, with 16% of the work you get 16% of the benefit.
Overall, after two iterations, you did 20% + 16% of the work and got 80% + 16% of the benefit. With 36% of the work you got 96% of the benefit.
Here is a table with 7 iterations:
| iter | iter work | total work | iter benefit | total benefit |
|---|---|---|---|---|
| 1 | 20% | 20% | 80% | 80% |
| 2 | 16% | 36% | 16% | 96% |
| 3 | 12.8% | 48.8% | 3.2% | 99.2% |
| 4 | 10.24% | 59.04% | 0.64% | 99.84% |
| 5 | 8.192% | 67.232% | 0.128% | 99.968% |
| 6 | 6.554% | 73.786% | 0.026% | 99.994% |
| 7 | 5.243% | 79.028% | 0.005% | 99.999% |
After 7 iterations you did 79% of the work and got 99.999% of the benefit.
| iter | iter work | iter benefit | work / benefit |
|---|---|---|---|
| 1 | 20% | 80% | 0.25 |
| 2 | 16% | 16% | 1 |
| 3 | 12.8% | 3.2% | 4 |
| 4 | 10.24% | 0.64% | 16 |
| 5 | 8.192% | 0.128% | 64 |
| 6 | 6.554% | 0.026% | 256 |
| 7 | 5.243% | 0.005% | 1,024 |
The work of the 7th iteration is 1024x the benefit (4^(7-2)).
| iter | total work | total benefit | 1 / missing benefit |
|---|---|---|---|
| 1 | 20% | 80% | 5 |
| 2 | 36% | 96% | 25 |
| 3 | 48.8% | 99.2% | 125 |
| 4 | 59.04% | 99.84% | 625 |
| 5 | 67.232% | 99.968% | 3,125 |
| 6 | 73.786% | 99.994% | 15,625 |
| 7 | 79.028% | 99.999% | 78,125 |
After 7 iterations you are still missing 1 / (78 thousand) of the benefit.
| iter | total work | total benefit | 1 / missing benefit |
|---|---|---|---|
| 8 | 83.223% | 99.999744% | 390,625 |
| 9 | 86.578% | 99.9999488% | 1,953,125 |
| 10 | 89.263% | 99.99998976% | 9,765,625 |
| 11 | 91.410% | 99.99999795% | 48,828,125 |
| 12 | 93.128% | 99.99999959% | 244,140,626 |
| 13 | 94.502% | 99.99999992% | 1,220,703,064 |
| 14 | 95.602% | 99.99999998% | 6,103,513,664 |
After 14 iterations you did 95% of the work and are only missing 1 / (6 billion) of the benefit.
If we imagine that the benefit corresponds to how you compare with other people, you could now be close to being the world’s best.