Friday, April 24, 2009

Explain Pareto Charts?

Pareto charts readily identify problems that have the maximum effect on the success of an application.

For example if you have 100 issues in your project then the Pareto rule says that 80 of these are the result of 20 of the causes. It helps you to see what types of issues are causing most of the problems on your project.

To create a Pareto chart, the frequency of events is used to draw histograms to show how often a problem occurs. For example, assume user complaints for a newly installed software are grouped into the five categories of ‘content’, ‘accuracy’, ‘User interface’, ‘ease of use’, and ‘Maintenance’. For each complaint, the below table provides the number of complaints collected over a period of time.

Problem typeFrequency of complaintsPercentage
User interface2830.4
Ease of use4043.5

The below table provides cumulative percentage of user complaints for the newly installed software. This tally of user complaints suggests that nearly 74% of the problems are caused by system ‘User interface’ or ‘ease of use’ aspects. This is close to the 80-20 law that suggests 80% of the problems can be traced to 20% of the sources. In the case of the newly installed software, the project manager must focus corrective efforts on making the system easier to use and to improving the User interface with the software since these two problem areas account for the majority of the complaints. This does not mean that the project manager should ignore other quality problems raised by the user. All these problems must be checked. However, it is a way of prioritizing so that dealing with ease of use and User interface aspects, in this case, enables the project manager to address the majority of complaints quickly.

Problem typePercentageCumulative %
Ease of use43.543.5
User interface30.473.9