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The Three Mental Models I Use Nearly Every Day
Mental Models and Me
My introduction to mental models came many, many years ago. Still, they became a part of my daily thinking and routines after I read Poor Charlie’s Almanack by Charlie Munger. As I’ve grown older and spend more time reflecting and less time (hopefully) reflexing, it has become apparent how helpful mental models are in assisting me in making better, more consistent, more rapid, and higher quality decisions.
I thought I would introduce you to the three mental models that I use nearly every single day.
The Pareto Principle And Reductions
The Pareto Principle, or 80/20 Rule, is very commonly discussed but, in my experience, very often ignored in real applications. Stated simply, it means that in most cases (not all, but most), 80 percent of the output is created by 20 percent of the input. Examples include 80% of revenue being driven by a core 20% of customers, 80% of the project value being created by 20% of the effort, and 80% of the resource being consumed by 20% of the populace. These are excellent rules of thumb, and if you find the correct 20% to do/buy/stimulate, 80% of the desired outcome is likely in your grasp. Let’s face it, 80% of the outcome is much more than expected and needed in many things in life. That makes this an…
