Pareto
Vilfredo Federico Damaso Pareto was an Italian sociologist and economist, born in the XIX century which influenced the economic and sociological fields and became known by the "80/20" rule or the "law of the few but critical", that is, for many events, approximately 80% of the effects are produced by 20% of the causes.
American engineer and management consultant of Romanian origin, Joseph M. Juran, was the one who proposed and developed the diagram and named it after Pareto.
The Pareto chart is an analysis and visualization tool used to identify and prioritize the main causes of problems or to identify the important factors in a data set. The diagram uses a bar graph that represents the frequency of the causes/categories, and they are arranged in descending order, from the most frequent to the least frequent. Usually there is also a cumulative line overlapped on the bar graph, which shows the cumulative percentage of the total.
To create a Pareto chart:
- identify and define the problem/situation to be analyzed
- collect reliable data regarding the problem
- the collected data must be classified into categories
- count how many times each category appears and calculate the percentage of each of the total
- the data are ordered according to frequency, from the highest to the lowest
The Pareto chart is a versatile tool that can be applied in any field where it is necessary to identify and prioritize problems in order to improve production processes, quality control, resource management, and defect reduction. By focusing on the most critical causes, organizations can use the available resources of personnel, time and money more effectively, avoiding consuming them on minor or insignificant problems, thus facilitating a structured and systematic approach to continuous process improvement. It also helps effective communication through a clear and easy-to-understand visual representation to make data-based decisions.
In conclusion, the use of the Pareto chart is essential for identifying, prioritizing and effectively solving critical problems to continuously improve processes in various fields.
