Pareto

Based on the Pareto principle, also known as the 80/20 rule

Pareto Principle: Vilfredo Pareto observed that 80% of the peas in his garden came from 20% of his pea plants and

80% of Italy's land was owned by 20% of the people.

So the principle - 80% of effects come from 20% of causes

How does that help us - if we can find the 20% causes and remove/reduce their occurrence then we remove 80% of errors

Pareto Chart: presents the chosen areas sorted by relative frequency, also cumulative percentage line on the Z-axis ( see example below)

Area: Decide an area you want to study - it should be able to give some data
Category: Choose the causes, problems, categories that you will use to group items eg. count of errors in process steps, failure types, error types, reasons for rejection...
Unit of measure: Choose the appropriate unit of measure. eg if you are trying to save costs - then total expense on an item would be better than the count of items.
Period: choose the period that will give you sufficient data, day, week, month
Collect data: or use the data available - with categories
Tabulate: use the table in the template ( shown in the example below )
Once done, format the graph is required.
Interpretation: the tallest bar points to the largest contributor. You can also see that where the cumulative % line, comes near 80 %, in this case, the first 4 parameters contribute to the 78.3% of errors
Is it always 80: 20, No .... we are just trying to prioritize and find the biggest impact areas.
In the shown examples case it is 78.3: 40 ( 4 of 10 parameters)
Start with the biggest one and keep on

To concentrate on the problems/areas that offer the best potential for improvement
To prioritize
Use the pareto chart to visually present areas that need improvement

Breakdown the tallest bar and make a linked pareto of its causes
Similarly you could use multiple pareto's and present side by side to compare - e.g. by region, by process (Note parameters should be same) Helps find solutions as well , e.g. if grammar is problem is one region and not in another - what has the region done differently

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