I've been reading The Four-Hour Work Week by Timothy Ferriss. It's very engaging - smart and full of good stories and good humor. The book's argument - that you can run a successful business by working only four hours a week - is mind crack for any busy entrepreneur. Ferriss makes the idea seem plausible.
I don't remember how I found out about him. I do remember seeing a piece he wrote in Forbes Small Business that featured a photo of him training in mixed martial arts with a caption that went something like, "I run a great business... and spend more time on sports than work... using my simple time-saving system."
Ferriss is not only an interesting guy, he's a master at promoting himself. For example, he holds a world record in the tango (for the most turns made in a given time) - and to document the achievement, he got himself on Regis and Kelly. He also won a martial arts competition by, as it turns out, taking advantage of a technicality in the rules.
Ferriss was working 15 hours a day, he says, when he came across the work of economist Vilfredo Pareto. Pareto is the one who came up with the original "8/20 rule" (also known as Pareto's Law), demonstrating that 80 percent of a society's wealth is produced and owned by 20 percent of the population. "This highly debated principle," Ferriss points out, "also applies to other situations. For instance, 80 percent of a company's profits typically come from 20 percent of its products and customers."
Ferriss applied Pareto's 19th century concept to his company "by pinpointing the sources of most of my sales - and my problems - so I could spend my time more efficiently." He quickly realized that of more than 120 wholesale customers, only five were bringing in 95 percent of his revenues. Then, in a single day, he made a few simple but "emotionally difficult" decisions that changed his life for the better.
"First, I decided to stop pursuing most of my customers so that I could profile and duplicate the most profitable ones," Ferriss says. "I was spending most of my time working on small accounts, when the big five already ordered regularly without any follow up. I also abandoned being busy for being productive. I realized I could reduce my hours by limiting tasks to the critical few and cutting my work time to force myself to focus on the most important projects."
I like what I'm hearing from this guy.
