Pareto Diagram Definition. A pareto chart is a type of chart that contains both bars and a line graph where individual values are represented in descending order by bars and the cumulative total is represented by the line. The lengths of the bars represent frequency or cost time or money and are arranged with longest bars on the left and the shortest to the 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. A pareto diagram is a simple bar chart that ranks related measures in decreasing order of occurrence. In addition the pareto chart includes an arc representing the cumulative percentage of the causes.
In order to expand on this definition let s break a pareto chart into its components.
Pareto charts are useful to find the defects to prioritize in order to observe the greatest overall improvement. A pareto chart is a bar graph. A pareto chart is a graph that indicates the frequency of defects as well as their cumulative impact. The chart is named for the pareto principle which in turn derives its name from vilfredo pareto a noted italian economist.
