Definition
Pareto Analysis is a method for identifying the most important causes or problems by ranking them according to their effect on the subject being studied.
Human Explanation
The method helps determine which problems have the greatest effect on results and where improvement should begin.
Why it Matters
Focusing on the most important problems makes better use of time, resources and improvement effort.
Conceptual Boundary
Pareto Analysis identifies priorities but does not explain the causes of problems. Other analytical methods are needed to understand them.
Practical Perspective
Not every problem requires the same effort. Pareto Analysis helps focus work where it can create the greatest effect.