Friday, March 16, 2018



            The Pareto chart is based on the principle named after an Italian economist Vilferdo Pareto who observed that 80% of land in Italy in the early 1900’s was owned by 20% of the population. A Pareto is a bar graph. The lengths of the bars represent frequency or cost(time or money) and are arranged with longest bars on the left and shortest to the right. In this way, the chart was visually depicts which situation are more significant.

·         When using Pareto chart :
Ø  When analyzing data about the frequency of problems or causes in a process.
Ø  When there are many problems or causes and you want to focus on the most significant.
Ø  When analyzing broad causes by looking at their specific components/
Ø  When communicating with others about your data.

·         Pareto chart procedure :
Ø  Decide what categories you will use to group items.
Ø  Decide what measurement is appropriate. Common measurement are frequency, quantity,cost and time.
Ø  Decide what period of time the Pareto chart will cover one workcycle? One full fay? A week?
Ø  Collect the data, recording the category each time.
Ø  Subtotal the measurements for each category.
Ø  Determine the appropriate scale for the measurement you have collected. The maximum value will be the largest subtotal from steps. Mark scale on the left side of chart.
Ø  Construct and label bars for each category. Place the tallest at the far left, then the next tallest to its right and soon. If there are many categories with small measurements, they can be grouped as “others”.
Ø  Calculate the percentage for each category, the subtotals for the category divided by the total for all percentage. Draw right vertical axes and label it with percentages. Be sure the two scales match. For example, the left measurement that corresponds to one-half should be exactly opposite 50% on the right side.
Ø  Calculate and draw cumulative sum: Add the subtotals for the first and second categories, and place a dot above the second bar, indicating that sum. To that sum add the subtotal for the third category and place dot above the third bar for the new sum. Continue the process for all the bars. Connect the dots, starting at the top of the first bar. The last dot should reach 100 percent on the right scale.

Collected from Google
Collected by: Sony Maharjan( Team Samarpan, SEE graduate 2073)

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