# Pareto Chart | Pareto Principle | What is Pareto Chart in 7 QC Tools?

## What is Pareto Chart in 7 QC Tools?

→**Pareto Chart**was invented by Vilfredo

**Pareto**.

→

**Pareto Chart**is a diagram that shows the order of the largest number of occurrences by item or by classes and the cumulative sum total.
→ It is a combination of a bar graph and line graph.

→ A bar graph is arranged in descending order of height from left to right while a line graph represents the cumulative percentage.

→ The bar graph shows the number of defects and the line graph shows the cumulative percentage of the defect.

→ It is a very important tool of Basic 7 QC Tools.

→ It is a very important tool of Basic 7 QC Tools.

### ➤ History of Pareto chart and Pareto Principle:

→ Vilfredo**Pareto**was an Italian engineer, sociologist, economist, political scientist, and philosopher.

→ He shows an observation that is: "80% of the land in Italy was owned by about 20% of the population."

→ He introduced the concept of efficiency and helped to develop the field of microeconomics.

→ The

→ He also contributed to the fields of sociology and mathematics.

→ He introduced the concept of efficiency and helped to develop the field of microeconomics.

→ The

**Pareto**principle was named after him.→ He also contributed to the fields of sociology and mathematics.

## Pareto Principle in 7 QC Tools:

→**Pareto Principle**is also known as the 80/20 rule, the law of the vital few or the principle of factor sparsity

→ 80% of the Problems come from 20% of the causes.

→ 80% of the Outputs come from 20% of the Input.

→ It Distinguishes between Vital Few from Trivial Many.

→ 80% of the Results come from 20% of the effort

## Five Easy Steps for Making a Pareto Chart in 7 QC Tools:

- Select the problem.
- Collect data.
- Sort data & calculate the cumulative frequency.
- Draw the axes, Construct the bars, Draw the cumulative percentage line, Title and label the chart.
- Identify Vital Few from the Trivial Many by using 80:20 principle & plan further action.

### ➤ Step 1. Select the Problem to construct chart:

➝ Determine the method of collecting data and a period of data collection.

➝ Design a separate check sheet if necessary.

➝ E.g. : Defect analysis.

### ➤ Step 2. Collection of data:

➝ The second step is data collection for the graph.### ➤ Step 3. Sort data & calculate the cumulative percentage.

➝ After the collection of data, the third step in the

**Pareto chart**is to sort out data and find the cumulative percentage of data.### ➤ Step 4. Draw the axes, Construct the bars, Draw the cumulative percentage line, Give Title and labeling the chart:

➝ After sorting out data and find the cumulative percentage, Draw the axes, Construct the bars, Draw the cumulative percentage line, Give Title and labeling the chart.### ➤ Step 5: Identify Vital Few from the Trivial Many by using 80:20 principle and plan further action:

→ From step 4: as per the Chart, we have Identify Vital Few ( i.e. defect D, Defect E, Defect F and Defect A ) from the Trivial Many (i.e. All defects ) as per 80:20 Rule.

→ Now we will take action on these defect by finding the root cause of defect generation and implement preventive action on it.

→ It displays the relative importance of causes of the problem.## Benefits of Pareto Chart in 7 QC Tools:

→ We can easily distinguish between Vital Few and Trivial Many.→ Helps the team to focus on those causes that will have the greatest impact when solved.

→ By using 20% of resources we can solve 80% of problems.

→ We can easily understand the impact of the defect on our production

→ It is very easy for analysis by this tool

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