Pareto Optimality

Related Articles Pareto Efficiency Vilfredo Pareto Biography Pareto Principle Pareto Chart

Pareto optimality is named after Italian sociologist and economist Vilfredo Pareto (1848-1923), this is a situation which exists when economic resources and output have been allocated in such a way that no-one can be made better off without sacrificing the well-being of at least one person.

V Pareto, Manuale d'economia politica (Milan, 1906)

Pareto Optimum

A situation is considered Pareto Optimal or at the Pareto Optimum (cf: Pareto Efficiency) when it is the "best that could be achieved without disadvantaging at least one group." (Allan Schick, in Louis C. Gawthrop, 1970, p.32) and much like many of Pareto's works, have been found to be far more compelling and applicable then initially believed.

Applied Pareto Optimality

All projects are constrained by the Project Triangle (Time, Scope, and Money).  Based upon a given projects unique constraints, a project manager's goal is to complete the project with Pareto Optimality, balancing these constraints and finish the project.  Resource tradeoffs for project duration, adjusting scope (using the Pareto Principle, no doubt) to control costs, and sacrificing a little quality for time to market considerations are all examples of the balancing act required. 

However, cut one of these factors too far, and the others suffer, regardless of the contribution to the other factors.  The Pareto Optimal, or Pareto Efficient, project is one in which each of the constraints are balance out and maximize effective project completion.

Spelling and Pronunciation

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

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