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We will ground our decisions based on data and facts, not on what we think we know. With data, we can experiment and be bold on paper. It costs us nothing yet enables greater bias for action and more entrepreneurial thinking. We must get comfortable with what we think we should do and the likely consequences (good and bad) before we charge ahead! To that end, we must view our business segments through quads and quartiles. Think about quads and quartiles as merely another lens through which you evaluate your distinct business lines. They’re as critical to successfully focusing on the things that matter most as your income statement, balance sheet, cash flow statement, sales funnels, and operational bowler charts. Just as we wouldn’t expect to run a successful business using only a baseline income statement, neither should we consider to successfully reap the benefits of 80/20 by using only a baseline quartile chart. They must be updated annually or semi-annually to ensure progress versus plan.

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80/20 tools and KPIs to consider with this principle

• Overall business quad and quartile
• Segment quads and quartiles
• Address Quad 4 until complexity is removed
• “A”/“B” product and customer thresholds versus opportunity pipeline
• Changeovers per week, orders per week, revenue per order

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