Professional Documents
Culture Documents
“Predictable Imbalance”
“80:20 Rule”
Named after Vilfredo Pareto -
an Italian economist
•He observed in 1906 that 20%
of the Italian population owned
80% of Italy's wealth
Hickeys 50 45 80 10 185
Scuffing 10 14 3 60 87
Excess Spray 16 21 30 5 72
Other 30 37 21 30 118
2500
90%
80%
2000
70%
60%
1500
Total defects
50%
40%
1000
30%
500 20%
10%
0 0%
Color variation
Misregister
Excess Spray
Hickeys
Other
Scuffing
Defect
Press 77" 5-C
Press 22x28
0
50
100
150
200
250
300
350
100
200
300
400
500
600
700
800
0
Color variation
Color variation
Hickeys
Misregister
Misregister
Hickeys
Defect
Defect
Excess Spray
Other
Other
Excess Spray
Scuffing
Scuffing
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
0
100
200
300
400
500
600
700
800
100
200
300
400
500
Color variation
Color variation
Misregister
Hickeys
Scuffing
Other
Defect
Defect
Other
Misregister
Hickeys
Excess Spray
Excess Spray
Scuffing
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
0%
100%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Relative Frequency
[(Category Contribution) / (Total of all
Categories)] x 100 expressed in bar chart
form.
Cumulative Frequency
[(Relative Frequency of Category
Contribution) + (Previous Cumulative
Frequency)] expressed as a line graph
Break Point
The percentage point on the line graph for
Cumulative Frequency at which there is a
significant decrease in the slope of the
plotted line
Vital Few
Category Contributions that appear to the
left of the Break Point account for the bulk
of the effect
Trivial Many
Category Contributions that appear to the
right of the Break Point, which account for
the least of the effect.
Pareto Diagram Analysis
• Pareto analysis provides the mechanism
to control and direct effort by fact, not by
emotion.
• It helps to clearly establish top priorities
and to identify both profitable and
unprofitable targets.
• In addition to selecting and defining
key quality improvement programs:
• Prioritize problems, goals, and objectives
• Identify root causes
• Select key customer relations and service programs
• Select key employee relations improvement
programs
• Select and define key performance improvement
programs
• Address the Vital Few and the Trivial Many causes
of nonconformance
• Maximize research and product development time
• Verify operating procedures and manufacturing
processes
• Product or services sales and distribution
• Allocate physical, financial and human resources
For a General Manager
The value of the Pareto Principle is
that it focuses efforts on the 20 percent
that matters.