Value Scales Unevenly

Ed Fowkes
Jun 5
5 min read

Following on from our examination of growth, its complex curves and our internal struggles with efficiencies and complexities, this week I shall look at distribution.

Beneath much of business, economics and technology sit recurring, structural patterns. Curves, distributions and constraints that appear again and again across nature, physics, networks and human behaviour. Difficult to ignore, like much of science and its laws, the maths behind these patterns is hard to break or to work against.

But even when you start to understand the curve you are surfing, there is an instinct that lingers, subtle, that shapes our decisions every day. The belief that effort distributes evenly.

There is an expectation in most businesses that inputs and outputs should relate in a tidy way. Add more people and output should increase proportionally. Increase marketing and revenue should follow. Invest more time and the result should improve in proportion to the time.

It feels fair. It feels logical. It is almost never true.

Ethics aside, neither value not effort distributes evenly. They concentrate. They cluster. Life behaves more like a landscape than a spreadsheet, with peaks, plateaus and long, flat stretches where effort produces very little in return.

This week we’ll dive into effort, and why most activity feels like a waste of time and effort, and why life feels, generally, unfair.

Don’t worry if you’ve not been following along, this is a piece that can stand alone. And if you really want you can make it your Part 1 of the series. No one will complain.

Welcome to Value Scales Unevenly, Part 4 of Misreading the Shape of Reality. A series examining the hidden structures shaping business, growth and human systems.

Value Scales Unevenly

Vilfredo Pareto was among the first to observe and document an uneven distribution pattern in economic systems. Roughly 80% of outcomes, he noted, tend to come from 20% of causes. The exact ratio shifts but the asymmetry persists.

Once you begin to look for it, it appears everywhere. And most of us will know of and see the 80-20 rule at work.

The outcome for a founder is that a small proportion of clients generate the majority of revenue. A handful of activities drive most of the meaningful progress. Within a product, a limited number of features account for the majority of usage. Even within a single week, a few hours tend to carry disproportionate weight.

Pareto is not a rule to be applied rigidly. But it is a signal, a recurring distortion in the relationship between effort and result.

Derek de Solla Price sharpened this idea further. His observation was more concentrated and therefore more uncomfortable. In many systems, half of the output is produced by the square root of the participants.

Shall we look at the distortion that creates?

In a team of one hundred, perhaps ten people produce half the meaningful work.

It gets a lot more extreme than that as the numbers grow. Last year I put out 150 posts and made around 1500 comments on others posts on LinkedIn. It doesn’t seem fair that just 11 of those posts and 32 of the comments account for 50% of the total impressions. Surely I can just give up circa 95% of my activity!

This is, unfortunately for us and our efforts, not an argument about talent in isolation, nor a justification for inequality. It’s simply a structural observation. In complex systems, contribution and outcome are rarely evenly distributed. Value clusters around certain individuals, certain decisions, certain moments.

And yet, most organisations are designed as though the opposite were true. Roles are defined evenly. Expectations are spread uniformly. Incentives are applied broadly. The system assumes symmetry where none exists. And founders often exhaust themselves trying to improve everything equally because focusing unevenly can feel psychologically uncomfortable. Neglect and prioritisation often appear dangerously similar to us.

Lines or Curves

Where Price drew a horizontal line across our rather steep bell curve, George Kingsley Zipf did a good job at describing the curve itself. Zipf’s Law reveals a continuous hierarchy. A few elements dominate, think Pareto or Price, and the rest follow in a long, predictable tail. There is no neat boundary, no clean division between the “top performers” and the rest. Instead, there is a gradient, a steady decline in impact as you move down the distribution.

We see this in many things, from city sizes, where a handful of global centres dominate while smaller towns taper off in scale, to language, where a few words are used constantly while most appear rarely. And we see it in digital platforms, where a small number of creators capture the majority of attention, but there is a broad range of audience and subscription sizes.

Nature does not like hard edges apparently. It prefers curves. Price’s Law cuts across the curve at a point of concentration. Pareto approximates it in a digestible ratio. Zipf shows you the underlying shape.

Taken together, they suggest something worth sitting with. What we often interpret as inefficiency or imbalance may simply be the natural structure of the system.

Tension

We spoke of tension last week discussing scale and efficiency. Well there is a practical tension that emerges from this uneven value distribution as well.

If most value is created early, or by a small number of inputs, what should we do with the rest? This is where founders often find themselves caught in what I think of as the perfection trap.

The first 70 or 80% of a project tends to deliver the majority of its impact. The core idea is formed, the functionality established, the value made clear. Beyond that point, effort shifts towards refinement. Edges are smoothed, details adjusted, imperfections removed. For many, particularly those with a strong bias towards craft or a passion for their produce, this stage is deeply satisfying. It is where the work becomes precise, considered, even elegant. But economically, the returns often fall away fast.

That first 80% takes around 20% of the time. The final 20% of output can consume a disproportionate share of time and energy. And often, it does little to change the economic outcome in a meaningful way.

Now, I confess I am a perfectionist. This is not an argument against quality. But perfectionists do need a reminder that not all improvements carry equal weight. At least, they may add value to reputation over time but the returns can be slow to arrive.

The Law of Diminishing Returns makes this explicit and clear. Beyond a certain point, each additional unit of input produces less output than the one before it. More effort continues to yield results but at a declining rate. Eventually, in a business context, the system reaches a point where additional input adds only complexity and possibly no value. More people introduce coordination overhead. More features introduce confusion. More marketing introduces noise. What began as optimisation has become dilution. Unfortunately some founders continue refining long after the returns haveplateaued. Some dance to remember, others dance to forget.

At this point, a natural question emerges. If value is concentrated and effort eventually dilutes it, how do I decide where to focus?

Tune into Part 5 - Judgement and Excellence, where I dig into this very dilemma.