Buffett’s 5/25 Rule
Warren Buffett, a guy who probably knows a thing or two about being productive, apparently has some rule he applies to himself called the 5/25 rule. Read about it here or here. The rule is essentially a 3 step process:
- Write down 25 of your goals or projects that you want to get to.
- Prioritize them and circle the top 5.
- Avoid #’s 6-25 at all costs until the first 5 are completed.
The Constant Renewal article compares the process to the Pareto principle which says that “for many events, roughly 80% of the effects come from 20% of the causes”. Whenever I’ve come across the idea, it is often followed by an admonishment to determine and cut out the 80% that are not contributing the most.
Parallels to Navigation
As successful as Mr. Buffett is, I’m not sure I’m willing to entirely buy in, as I think his process should be used with caution. My own methods clearly do have similarity: I use essentially choose 3 ongoing projects and set the rest aside for the time being. For example, here you can see tasks representing my ongoing projects resting up top. Tasks representing on hold projects sit below:
These then translate into a list of things to do today. This way, my major 3 projects integrate nicely with my routines:
(For a full discussion on setting this up to run smoothly, consider Creating Flow with OmniFocus pp. 568-627. For designing a simple system that can work with any app or pen and paper, see Being Productive – Module 15.)
But that is where the similarities between my system and Buffett’s end.
First, I don’t necessarily work on these three engaged projects until they are all done before moving on. In fact, as soon as I wrap up with one, another takes its spot. Sometimes, too, I’ll switch one out between what’s engaged and parked, even if something’s not finished.
I’ll also work on other things that are in my Considered list, a list of things I’d like to get to. And sometimes, I just play a video game, do the dishes, help out with the kids’ homework, or have a beer, none of which may be on the list.
Maybe I’m justifying some lack of my own productivity. Were I to measure productivity in terms of economic success, then no, I’m nowhere near as productive as Buffett. And sometimes, I don’t want to be some paragon of efficiency. I want to allow myself some degree of flexibility.
How We View Goals
But, perhaps there are other questions lurking underneath: What are goals? What are they good for?
I tend to view goals as ideas we can head toward but also that they can and should change over time. They are creative endeavors. If we knew all the steps between here and there, if we knew exactly what they would look like in the end, I’m not sure they’d really be goals. In other words, goals are projects and ideas that we only truly see and understand in the process of creating them.
That doesn’t mean I have no idea where I’m heading and just wander. I do have a direction, and I shape, shift, and adjust the vision as I continue. It is similar to an author who may not wish to write a book if they knew exactly what it would look like in the end. Not knowing, they still start and continue writing.
Cautions with the Pareto Principle
Now the Pareto Principle, as lauded as it is, has similar problems. If I measured, for instance, what brings me my income and dropped the things that didn’t measure up to that 80%, I’d stop playing the piano, and I’d stop playing video games. Heck, I wouldn’t have had kids. In fact, I recall someone once describing having kids as the worst financial decision a person can make.
The problem is that when we measure things, we need to make sure that we understand that a measurement, a part of calculating priority, operates from our own projections. We theorize what’s important about something, then measure based on that. If I assume that who pays me the most is what’s most important, then I’ll measure my business that way.
But those assumptions and theories are often wrong. They are useful to have, but they must be crafted and shaped over time. While money is important, I find other, sometimes immeasurable factors, more important.
The human mind is a machine designed for assessing, calibrating, and re-assessing.
Working with tasks should reflect the mind’s natural processing. If some goal seems wrong or off, if some idea seems to now be more important, I would like to re-prioritize. Of course, we could say that this now opens the door to procrastination where we’ll once again find ourselves leaving a trail of incomplete work. But we can address this simply: have lists of Active and On Hold projects that you visit regularly. When you decide to make a change, you can do so deliberately, knowing full well what the opportunity costs are.