Real Simple Innovation for
16 Times Better Results
Richard Koch
Introduction by Price Pritchett
Introduction
How would you rate yourself in terms of creativity?
On a ten-point scale — with 1 being almost zero imagination, originality, or innovative ability, and 10 representing superb creative powers — where would you score? Seriously think about it. Now circle the number that you think fits:
This is a lot bigger deal than you might imagine. Organizations are hungry for good ideas. The smart companies know their future depends heavily on relentless improvement ... on constant innovation ... on breakthroughs. So they’re cranking up their efforts to become more creative.
This handbook positions you to help move the needle in that direction. Regardless of where you rank yourself on creativity, you can learn the mechanics of achieving breakthrough results. The 16X approach is so simple. So down to earth. But you’ll see that, compared to how people and organizations typically operate, it’s as unique as it is powerful.
16X is about strengths-based innovation. And it will deliver breakthroughs in your personal life just as well as it does on the job.
The 16X approach works by establishing some “core conditions” that creativity and innovation flow from: white space, a focus on what counts, and the engagement of signature strengths. It’s a process of finding more running room so your prime talents can flex and further develop. By getting rid of the common disabling conditions, creativity and innovation come to life, liberating your most able and talented self.
Your guide on this innovation pathway is Richard Koch. He’s the most authoritative voice on Planet Earth about the breakthrough principle of 16X.
I chased down Richard via email at his home in Cape Town, South Africa, asking him to work with PRITCHETT on this handbook. He’s a brilliant, fascinating, hugely successful person, and he lives his message. Beyond his best-selling books that we’ve quoted on the following pages, he’s living proof that the concepts work.
Now, consistent with the breakthrough principle of 16X, let me end with this point. Most of what you read this week won’t make a bit of difference. It will be a waste of your time. But this handbook can change your life.
– Price Pritchett
Preface
So How Did It Go For You This Morning?
Most likely you climbed out of bed at about the usual time. Then you hit your routine — a familiar pattern of steps that involve getting cleaned up, clothed, and maybe caffeinated to face the day.
Heading into your closet, what did you pick to wear?
There’s little doubt, out of all the articles of clothing you have to choose from, only a handful were even considered as you got dressed. The same 20 percent of your garments are what you end up wearing 80 percent of the time.
Now think of all the toiletries in the cabinets, drawers, and shelves of your bathroom. How much of that stuff do you actually use these days? It’s a safe bet: The same 20 percent of those many personal items are all that you use 80 percent of the time. The rest is pretty much clutter. You hardly ever touch it.
The same peculiar pattern shows up yet again as you head to work. Out of all the possible routes you could travel, you choose the same 20 percent as the path you’ll take 80 percent of the time.
And so unfolds the ordinary, everyday proof of a remarkable principle at work in your life. It’s called the 80/20 principle.
This well-known principle captures the lopsidedness that so often occurs between cause and effect. For example, 80 percent of results flow from 20 percent of effort . . . 80 percent of the outputs are driven by 20 percent of inputs . . . 80 percent of consequences are the outcome of a mere 20 percent of the causes. A fairly small amount of our time, energy, and effort is amazingly more productive than most of it. The 80/20 rule highlights this strange but predictable imbalance between efforts and rewards.
But there’s another principle that follows from the 80/20 concept, one that isn’t so well known. And it holds the secret to stunning performance breakthroughs on the job as well as in your personal life.
This related principle is about practical, down-to-earth innovation. It’s a creative approach any person or organization can use to escape from the routines and attitudes that trap us. It’s the new story of the “16 times” principle, or 16X for short.
The 16X principle positions you to multiply your effectiveness by a factor of 16. Let’s go over that again, and make sure it sinks in. You can use the 16X principle to become super-productive . . . to achieve results which are 16 times better than what you’ve been getting. Maybe even more. And you can do this without experiencing a smidgen more stress or strain.
Just like the 80/20 principle that underlies it, the 16X principle belongs to everybody. It can work for anyone and everyone. It’s a realistic, ready-to-use innovation process for doing things differently, with no more effort or energy than today, to get 16 times better results.
The amazing 16X principle is actually easy to prove. But the important thing is to discover how powerfully it can work for you.
Chapter 1
Tracing the History of 16x
The story of 16X began in Switzerland, over a hundred years ago, and it started out as a study of money.
The year was 1897. A shaggy-bearded Italian named Vilfredo Pareto — professor of economics at Lausanne University — was about to stumble onto an amazing discovery.
Pareto was curious about wealth. He wondered about the patterns of rich and poor among people all around the world. Studying many countries, across the reach of time, he was staggered to find almost exactly the same pattern showing up in every situation. Wherever he looked, a few people earned most of the money and had most of the wealth. The majority of people were poor. The imbalance was almost identical, regardless of country or time. It just always played out that way.
This unequal distribution of wealth is as predictable today as it was back then. It’s like a natural law is at work, dividing people into the “haves” and “have-nots.”
Economists began to notice all kinds of unequal patterns, where just a few causes accounted for most of the results. They called it Pareto’s Law. Only decades later was this strange phenomenon labeled “the 80/20 rule” or “the 80/20 principle.” Since the 1950s, thousands of studies have shown most of any firm’s profits come from a small portion of products. The large majority of sales come from a select few customers. Roughly 80 percent — sometimes only 70 percent, sometimes 90 or even 99 percent — of results come from 20 percent or less of the inputs. Indeed, Pareto had uncovered a bizarre and unbalanced relationship between cause and effect.
Here are just a few real life examples of how the 80/20 principle operates:
South Africa’s leading venture capital house, Brait, recently found that 11 percent of its deals over the past 13 years had yielded 80 percent of total deal profits.
Just 12 percent of American households use personal financial management software, but they account for 75 percent of the profits made by all US banks.
5 percent of Internet sites get 75 percent of all Web traffic.
Studies in leading North American banks consistently show that 15-25 percent of each bank’s customers generate 80-95 percent of the bank’s profits.
In the last month, I sent 572 emails to 134 different people. My most long-suffering friend got 103 emails — 18 percent of emails to less than 1 percent of recipients. A total of 18 people received 400 emails — 70 percent of emails to just over 13 percent of people. The top 38 recipients had a total of 476 emails from me — 28 percent of correspondents got 83 percent of emails.
The 20th Century accounted for a tiny fraction of 1 percent of human history — just 0.00025 of it — but it hosted 20 percent of all human years lived since history began.
4 percent of the world’s people speak 60 percent of its languages, but the most popular 1½ percent of languages are used by 90 percent of us.
The 80/20 principle is now established as the way that numbers work for nearly everything related to wealth, economics, business, and much of everyday life. Pareto’s Law remains alive and well.
But only recently has attention begun to shift to another principle, one that is even more compelling than the 80/20 principle. The new discovery — the 16X principle — is logically derived from 80/20. If the 80/20 principle is true, as countless investigations prove, then the 16X principle is true. And that’s terrific news for everyone, because it means we can all change how we do things and get 16 times greater results.
