Understanding the Pareto Principle (The 80/20 Rule)

Originally, the Pareto Principle referred to the observation that 80% of Italy’s wealth belonged to only 20% of the population. More generally, the Pareto Principle is the observation (not law) that most things in life are not distributed evenly. It can mean all of the following things: 20% of the input creates 80% of the result20% of the workers produce 80% of the result20% of the customers create 80% of the revenue20% of the bugs cause 80% of the crashes20% of the features cause 80% of the usageAnd on and on… But be careful when using this idea! 20% of the workers could create 10% of the result. Also recognize that the numbers don’t have to be “20%” and “80%” exactly. Life Isn’t Fair What does it mean when we say “things aren’t distributed evenly”? In a perfect world, every employee would contribute the same amount, every bug would be equally important, every feature would be equally loved by users. But that isn’t always the case: Of course, this ratio can change. So Why Is This Useful? Related: learning.2 • productivity

Pareto Chart Looking for more quality tools?Try Plan-Do-Study-Act (PDSA) Plus QTools™ Training: Also called: Pareto diagram, Pareto analysis Variations: weighted Pareto chart, comparative Pareto charts A Pareto chart is a bar graph. When to Use a Pareto Chart When analyzing data about the frequency of problems or causes in a process. Pareto Chart Procedure Decide what categories you will use to group items. Steps 8 and 9 are optional but are useful for analysis and communication. Calculate the percentage for each category: the subtotal for that category divided by the total for all categories. Pareto Chart Examples Example #1 shows how many customer complaints were received in each of five categories. Example #2 takes the largest category, “documents,” from Example #1, breaks it down into six categories of document-related complaints, and shows cumulative values. Example #1 Example #2 Excerpted from Nancy R. Create a Pareto Chart Analyze the occurrences of up to 10 defects.

What is Pareto chart? Definition from WhatIs A Pareto chart, also called a Pareto distribution diagram, is a vertical bar graph in which values are plotted in decreasing order of relative frequency from left to right. Pareto charts are extremely useful for analyzing what problems need attention first because the taller bars on the chart, which represent frequency, clearly illustrate which variables have the greatest cumulative effect on a given system. The Pareto chart provides a graphic depiction of the Pareto principle, a theory maintaining that 80% of the output in a given situation or system is produced by 20% of the input. The Pareto chart is one of the seven basic tools of quality control. The independent variables on the chart are shown on the horizontal axis and the dependent variables are portrayed as the heights of bars. A point-to-point graph, which shows the cumulative relative frequency, may be superimposed on the bar graph. A Simple Example See also: flowchart, histogram

Create interactive flash tools Q. Who are you anyway? A. Classtools.net is the work of Russel Tarr, Head of History at the International School of Toulouse, France and author of the established website www.activehistory.co.uk. Q. A. Q. A. Q. A. Q. A. Q. Generally speaking, only if you create a link to the resource from your own website / wiki / blog etc. Q. A. Q. A. Q. A. Achieve More With Less In Life Using 80/20 Principle by Celes on Jan 9, 2009 | ShareThis Email This Post This is part-1 of a 3-part series on achieving more with less in your life using the 80/20 principle. “Conventional wisdom is not to put all of your eggs in one basket. 80/20 wisdom is to choose a basket carefully, load all your eggs into it, and then watch it like a hawk.” – Richard Koch, The 80/20 Principle Today, I am going to share with you the power of applying the 80/20 principle to your life. Even though I initially applied it at work, I have come to witness its presence in virtually all aspects of life (relationships, goal achievement, emotions, time management, etc) and how much value it can bring to all of us through its application. So, what is the 80/20 Principle? Imagine you are the CEO of a company and you have a sales force of 100 people. However, what if instead of a 1-1 relationship, you found out 80% of your sales is actually contributed by 20% of your staff? What the 80-20 Principle Is About ….And the list goes on. 1. 2.

The Checklist Manifesto: How to Get Things Right It’s no secret that I’m a huge fan of Atul Gawande. A reader recently pointed out that I hadn’t covered his most recent book, The Checklist Manifesto: How to Get Things Right. I had only covered an interesting subset of the book—why we fail. In this post, we’ll take a quick look at some other parts of the book. To put us in the proper context, we’re smart. the volume and complexity of what we know has exceeded our individual ability to deliver its benefits correctly, safely, or reliably. To overcome this we need a strategy. In response to increasing complexity we’ve become more specialized. The response of the medical profession, like most others, is to move from specialization to super-specialization. Modern professions, like medicine, with their dazzling successes and spectacular failures, pose a significant: challenge: “What do you do when expertise is not enough? The origins of the checklist. On October 30, 1935, at Wright Air Field in Dayton, Ohio, the U.S.

The 80/20 Principle|Richard Koch Author Consultant Financial Risk Management and Global Risk Management Network. Business Technology, Finance and Risk Research Portals. Finance, Trading, Stock Analysis, Risk Management, and, Business Technology Management Research Portals, News, and Articles. Save 90% of Video Games in the Brain: Study Shows How Gaming Impacts Brain Function to Inspire Healthy Behavior “Identifying a direct connection between the stimulation of neural circuits and game play is a key step in unlocking the potential for game-based tools to inspire positive behavior and improve health,” said Brian Knutson, Ph.D., Stanford University. Redwood City, CA (PRWEB) March 19, 2012 In news that could shift how game developers and healthcare professionals harness the power of videogames to do good, HopeLab and Stanford University researchers today announced new data showing that Re-Mission™, a video game about killing cancer in the body, strongly activates brain circuits involved in positive motivation (1). This reward-related activation is associated with a shift in attitudes and emotions that has helped boost players’ adherence to prescribed chemotherapy and antibiotic treatments in a previous study (2). A growing body of data shows that digital games can positively alter players’ attitudes and behavior. Sponsored by the nonprofit organization HopeLab and conducted by Steven W.