Wednesday, May 27, 2009

Tool 5 - Pareto chart

A Pareto chart is a form of a Bar chart which the special characteristic that the data is sorted in descending order before being used in the bar chart. As such the Pareto chart provides an immediate visual trend of the data set.

Because the Pareto chart pre-arranges the raw data, it is efficient when identifying most significant problems or causes, especially when there are several. Based on it's inherent property of representing frequency of occurrence, the Pareto chart is an effective tool to analyze frquency distribution for various categories.

To build a Pareto chart, it is important to correctly select the categories to be displayed and also the appropriate scale relative to the data collected. The Check sheet can be used to gather data. Once the Pareto chart is generated, the categories starting from the left are the obvious choices for further analysis.

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