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Sales Assessment Test Using Thoughts from Pareto's Economic

by guillerminafalkowski

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The problem of unequal wealth distribution is nothing new, existing even before capitalism and communism came close to a World War. In the early 20th century, Italian economist Vilfredo Pareto saw this problem in his country: a fifth of the population owned four-fifths of the country's wealth. In his garden, he saw that only a fifth of his pea pods produced four-fifths of his overall pea crop.

This gave birth to the Pareto principle, which describes the inequality in distribution of wealth in any economy. However, over the years, the principle has been adapted to various applications, including the field of business management. Is 80 percent of the company's sales coming from 20 percent of the salesmen? Regardless of how it appears, the Pareto principle can be helpful in making a careful sales assessment test.

Wouldn't you want to concentrate on what makes the 20 percent generate so much profit for the firm? Focusing on the 20 percent's talents and skills may help you solve 80 percent of sales problems such as the lackluster skills of some of the existing sales personnel. However, if the 20 percent commits mistakes, which is inevitable, it may account for 80 percent of your problems.

It's not a solid postulate, but business insiders agree that it's a good basis for business management. The principle helps you allocate resources into solving top-priority problems, resulting in the improvement of the majority of the company's functions. On the other hand, it can be a double-edged sword, with problems from the 20 percent hitting you hard.

It's not always smooth sailing in business; every problem that arises has a solution, which may produce a new problem, which needs a new solution, and so on. Then again, you can learn from the small part of the problem to create a major solution. Overall, the Pareto principle is an effective method to improve sales performance.

Go to to know more about the Pareto principle and its modern application in the field of business management. Always ask yourself this: “What does the 20 percent have that makes 80 percent of the results?”

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