ProblemSolving_ParetoDiagram

Pareto Diagram

  • Definition: A large to small ordered bar chat that shows the weight that each factor analyzed has. Present information in such a way that facilitates visualizing the important factors to address then first.

Example 1) After detecting an increase in the number of discrepancies in the launching operations, it was decided to analyze the situation. Several discrepancies audits were performed during a three week period.

- Microsoft Excel

Step 1: List in Excel all the causes of the problems and the number of occurrences related to them.

Step 2: Place the occurrences in decreasing order and calculate the percentage and cumulative percentage of each one.

Step 3: Create a bar and lines graph where the bars are the percentages of each subject and the line will be the cumulative occurrences, as shown in the picture.

 

- Minitab

Step 1: List in Minitab all the causes of the problems and the number of occurrences related to them.

 

Step 2: Go to Sat > Quality Tools > Pareto chart

 

Step 3: In defect or attribute data put your first column with the Causes; In frequency put your second column Frequency (IMPORTANT: The Pareto principle is also known as the principle 80 20, witch means that you can't forget to change your percent to 80%)

 

The Pareto principle, also known as the principle 80 20, was introduced in 1897 by Vilfredo Pareto. He said 80% of the world's wealth was concentrated in 20% of the population. Later it was found that the concentration ratio occurs in various other fields of science, such as population concentrations and organizational sciences. In an organization, 80% of your problems may be linked to 20% of the generating causes of problems in this organization. That means that attacking 1/5 of our potential causes, we will be resolving 4/5 of our problems. Of course, the relationship is not perfectly accurate, but it gives us the idea of concentration and prioritization in the attack root causes. Through the diagram, we can arrange the problems in order of how often they happen. Then just focus on the first 20%.