Pareto Chart or Pareto Diagram

What is a Pareto Chart?

Related Articles Pareto Principle Vilfredo Pareto Biography Pareto Optimality Pareto Efficiency

A pareto chart can be easily defined as a bar graph with the bars sorted in descending order used to identify the largest opportunity for improvement.

Pareto Graph Usage

A pareto chart is used to graphically summarize and display the relative importance of the differences between groups of data.  Pareto charts distinguish the "vital few" from the "useful many."

Vilfredo Pareto , a turn-of-the-century Italian economist, studied the distributions of wealth, findind that about 20% of people controlled about 80% of a society's wealth. This same distribution has been observed in other areas and has been termed the Pareto Princple or 80/20 rule.

The Pareto priniciple can greatly assist in areas such as quality improvement: (80% of problems usually stem from 20% of the causes) and Time Management Pareto charts are used to display the principal in action, arranging data so that the few vital factors that are causing most of the problems reveal themselves. Concentrating improvement efforts on these few will have a greater impact and be more cost-effective than undirected efforts.

Example

The following example chart shows what a Pareto Chart, Diagram (Diagrama de Pareto), or Graph looks like:

Spelling and Pronunciation

Vilfredo's family name is pronounced puh-RAY-toe, or pah-RAY-toe.  And while his given name may be occasionally misspelled or misquoted as Wilfredo, Vilfred, and even Alfredo, it is actually spelled Vilfredo.

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