Elon Musk Using the Pareto Principle in Real Time
After the recent acquisition of Twitter, Elon Musk promptly fired 50% of the employees. Shortly after that many more were left of their own free will. It is estimated that more than 50% of Twitter employees are gone compared to only one month ago.
Fear among the community is that with so many workers gone that the site will go under. That Twitter will no longer function and cease to exist. What many people don’t know is the Pareto Distribution.
The Pareto Distribution
There is a more complex mathematical version of exactly what the distribution is but there is a simpler metric. The 80-20 rule. It states that 80% of outcomes are due to 20% of causes. In the case of work, 80% of the jobs needed to get done are completed by only 20% of the workforce.
You can read more about Pareto Distribution and its applications here.
In the case of Twitter, the same thing would be true. 80% of the work that was being done by 20% of the employees. So if over 50% of the employees are gone, let’s be conservative and say 70% left. That leaves us with 30% of the workforce still there.
I think it is a safe assumption to say Elon is a smart guy. Which makes me believe he kept the employees who produce the most output. Based on those assumptions he kept the 20% of the employees that produce 80% of the work and an extra 10% of the employees. Therefore over 80% of the work at Twitter from only a month ago is still being completed but now with only 30% of the staff.
So yes, less work overall will be completed. But a lot more thank you think is actually being completed. To think that this company will go down anytime soon is short-sighted.
Exposing the “Educated”
Elon Musk is exposing all the people who claim to be “educated”. I am referring to the people who are using the #TwitterShutdown who actually believe Twitter will shut down.
These people think he doesn’t know how to run a company and firing everyone is a bad idea. Also to think he doesn’t know how to run a company is an absurd claim, like do you not see his track record? Success after success. He’s proving to them, and everyone, that they don’t know a basic fundamental principle of the world. The Pareto Principle.