The Power of the 80/20 Rule

As a young lawyer eager to make my mark, I attended a meeting of a prominent legal professional organization. The room was filled with both seasoned professionals and new lawyers like myself, all brainstorming ways to mobilize more members for a project on a significant legislative issue.

During the discussion, someone said aloud what many had been thinking:? it seemed the same people often ended up carrying the bulk of the load for the rest of the organization.

It was then that an older, highly respected member, a mentor to many of us, introduced the concept of the Pareto Principle, or the 80/20 rule.? He explained that typically about 20% of people in any organization end up doing 80% of the work. This observation was not a critique, rather an acknowledgment of a pattern seen across various organizational structures.

Years later, in a business mastermind group, I was re-introduced to the 80/20 rule. This time, however, it was presented not just as a pattern in organizational behavior, but as a strategy for managing work more effectively and efficiently. Inspired, I decided it was time to consider adopting the 80/20 rule at my firm.

You see, this insight came at a crucial time for me. My young firm was grappling with a challenge: we were taking on a wide variety of cases, but our approach wasn't optimized to handle them based on their complexity or value.

Instead, each attorney in our firm was handling cases of all sizes and complexities, which often led to the most valuable cases being overshadowed by the sheer volume of smaller, less significant cases. This was not only stalling progress on our cases, but was also impacting our revenue flow.

To implement the 80/20 strategy, we began by closely examining our caseload and we quickly identified a common pattern. Many of our cases, such as personal injury cases resulting from car accidents, typically resolved without the need for litigation, often settling pre-suit. Conversely, cases involving more complex issues like bad faith or truck accidents required intensive legal proceedings and were clearly headed for the courtroom.

Additionally, we made another critical observation. The bulk of our caseload — while significant in volume — only contributed to about 20% of our firm’s revenue. This was a classic demonstration of the Pareto Principle in action, suggesting that a smaller portion of our work was generating the majority of our financial returns.

This led us to re-organize the handling of our cases into two teams. The "80% Team" was tasked with handling cases likely to settle without litigation. They followed a streamlined process to either quickly resolve these cases or prepare them for litigation if settlement wasn't possible. Meanwhile, cases marked for litigation went directly to lawyers and paralegals equipped to handle complex disputes from day one.

By applying the 80/20 rule, we made sure that our lower-value cases received the focused attention and expedited handling they deserved, while freeing up the rest of our team to concentrate on the larger, more complex cases. This strategic division of labor not only improved our service quality, but also boosted our financial performance significantly.

Looking ahead, we are excited to keep refining this model and to explore additional applications of the 80/20 rule across other areas in our firm. To my peers in the legal industry: take a moment to consider how the 80/20 rule might revolutionize your practice as it has ours. It's not just about managing workload — it's about transforming your business for the better.

Simone Fulmer Gaus is a personal injury lawyer in Oklahoma City, who has headed her own law firm since 2014.