What is a Pareto Chart?
➝ The Pareto Chart is known after the famous economist Vilfredo Pareto.
➝ This is a very useful tool for data analysis and prioritization.
➝ This chart tells us about the vital few and trivial many analyses.
➝ It is the most important tool for quality control and analysis.
A Pareto Chart is also known as a Pareto Diagram.
➝ A Pareto Chart is a special type of bar chart having values from left to the right ordered from largest to smallest and a superimposed line graph showing the cumulative total percentage.
➝ We need to indicate the line graph on the chart's secondary axis.
➝ The secondary axis is available on the right side of the graph.
➝ The secondary axis contains the percentage so the value is lying between 0% to 100%.
➝ As a simple analysis of the Pareto Chart, we need to check, where the line graph crosses 80% to the left side categories that are known as the "vital few".
➝ These vital few categories have a significant impact.
→ Our 7 QC Tools templates include Pareto Chart, Scatter Diagram, Histogram, Check Sheet, Control Chart, Cause and Effect Diagram Excel template, and Flow Chart.
Pareto Analysis
➝ As per the Pareto Principle, the general guideline tells us that 80% of the problems occur from 20% of the causes.
➝ Vilfredo Pareto initially observed that in Italy, 80% of the land was owned by 20% of the people.
➝ In the 20th century, Dr. Joseph M. Juran used the above principle for quality management and applied this principle to the quality control field.
➝ After that, the phrase "the vital few and the trivial many" was made famous.
➝ The Pareto Principle is known as the 80-20 rule but the actual numbers may be different from case to case.
→ You can also refer to the Lean Six Sigma Project Charter Excel Template.
→ Also, You can check here, Different Six Sigma Project Templates Download
Example of Pareto Chart
➝ Now we will understand the Pareto Chart Excel Template with the help of one example.
➝ In this example, you can check the below template of the automatic Pareto chart.
➝ In this template, you need to enter the name of the category and its value in the given template.
➝ So the chart will automatically take the shape as per the value.
➝ You can refer to the below example, in that chart we have mentioned a defect 1 to 10 and the value of that defect.
➝ You can take the category as per your requirement.
👉 Download Automatic Pareto Chart Excel Template
More Examples of Pareto Chart
➨ Customer Complaints (e.g. 80% of the complaints come from 20% of the customers)
➨ Management (e.g. 80% of the results come from 20% of the group)
➨ Sales (e.g. 80% of the profits come from 20% of the products)
➨ Quality Management System (e.g. 80% of the problems come from 20% of the causes)
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