How do you prioritize the root causes based on the pareto principle in DMAIC?

1 What is a pareto chart?

A pareto chart is a graphical tool that displays the frequency or impact of different causes or categories in a process. It consists of a bar chart and a line chart, where the bars represent the individual values and the line represents the cumulative percentage. The pareto chart helps you to apply the pareto principle, also known as the 80/20 rule, which states that 80% of the effects come from 20% of the causes.

2 How to create a pareto chart?

Creating a pareto chart requires collecting data on the problem and its possible causes or categories, which can be done using tools such as brainstorming, fishbone diagram, or 5 whys. The data must then be sorted in descending order of frequency or impact, with the most frequent or impactful cause on the left and the least on the right. The cumulative percentage for each cause or category can be calculated using a formula like =SUM($B$2:B2)/SUM($B$2:$B$11) in Excel. After plotting the data as a bar chart and the cumulative percentage as a line chart on the same axis in Excel, you can add a title, labels, and legend to your pareto chart.

3 How to interpret a pareto chart?

Interpreting a pareto chart requires looking at the shape and position of the bars and the line. The bars that are on the left and above the line are the most significant causes or categories, responsible for most of the problem and should be addressed first. On the other hand, those on the right and below the line are less significant and can be ignored or deferred. The point where the line crosses the 80% mark is called the pareto point, indicating the minimum number of causes or categories that account for 80% of the problem. Additionally, the slope of the line shows how evenly or unevenly distributed causes or categories are; a steep slope means that a few causes dominate, while a flat one indicates complexity and diversity.

4 How to use a pareto chart in DMAIC?

A pareto chart is a versatile tool that can be used throughout the DMAIC cycle. In the Define phase, it can be used to determine the scope and magnitude of a problem and its impact on customer or stakeholder satisfaction. During Measurement, it can be used to measure current performance and variation of a process and identify key indicators. Analyzing data with a pareto chart allows you to pinpoint root causes and their relative importance. In the Improve phase, it can help prioritize and select improvement actions with the most impact. Lastly, in Control, it can be used to monitor and evaluate results of improvement actions and ensure the problem is solved and does not recur.

5 What are the benefits and limitations of a pareto chart?

A pareto chart is a useful tool for root cause analysis and problem solving, with benefits such as helping to visualize and communicate data, focus on the vital few, reduce waste and variation, and improve quality and efficiency. However, there are also some limitations to consider, such as not showing the causal relationships or interactions between the causes or categories, not accounting for the time factor or dynamic changes, and the potential need for additional data or analysis to verify and validate the results.

6 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?