Download - 007 Pareto Analysis
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Pareto AnalysisPareto Analysis
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Pareto AnalysisPareto Analysis
Contents
• What is a Pareto Diagram?
• Constructing a Pareto Diagram
• Interpreting a Pareto Diagram
• Uses of Pareto Diagrams
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Pareto Analysis - Learning ObjectivesPareto Analysis - Learning Objectives
After completing this module, you will be able to…
1. Construct Pareto Diagrams.
2. Interpret Pareto Diagrams.
3. Use Pareto Analysis to identify the “vital few” items on which to focus.
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Six Sigma Roadmap - Pareto AnalysisSix Sigma Roadmap - Pareto Analysis
BreakthroughStrategy
Characterization
Optimization
Measure
Analyze
Improve
Control
Define
To establish projectfocus.
To identify the “vitalfew” items impactingthe CTQ.
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What Is A Pareto Diagram? What Is A Pareto Diagram?
A Pareto diagram is a bar chart organized with the largest bar to the left and the smaller bars to the right in order of frequency.
Diameter
Position
Dimension
Notes
Hidden vie
ws
Sections
60
50
40
30
20
10
0
100
80
60
40
20
0
Defect
Per
cent
Co u
nt
Pareto Chart for Type
A Pareto diagram allows a team to:discover what type of categories relate to the problemfocus on the most important items
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What Is A Useful Pareto Diagram? What Is A Useful Pareto Diagram?
A diagram that shows 20% of the inputs (Xs) cause 80% of the problems with dependent process outputs (Ys)
Diameter
Position
Dimension
Notes
Hidden vie
ws
Sections
60
50
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30
20
10
0
100
80
60
40
20
0
Defect
Per
cent
Co u
nt
Pareto Chart for Type
In this case, two Xs contribute 87.7% of the problem!
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Constructing a ParetoConstructing a Pareto
1. Decide on the process you want to know more about.
2. Choose the causes or problems that will be monitored, compared and rank ordered by: • brainstorming (what are the issues?) • using existing data (what issues surfaced in the last
month?)
3. Choose the most meaningful unit of measurement:a. frequencyb.costc. both
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Constructing a Pareto Diagram (Cont)Constructing a Pareto Diagram (Cont)
4. Select a time period for study that is long enough to accurately represent the situation:
a. Look at volume and variety in the data
b. Make sure scheduled time is “typical” to allow for seasonality or different work patterns within a given day or week.
5. Use a check sheet or other method to gather “real time” or historical data on each problem category.
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Constructing a Pareto Diagram (Cont)Constructing a Pareto Diagram (Cont)
The chosen measurement units (e.g. frequency, cost) are shown on the vertical axis
The chosen problem categories are shown on the horizontal axis
Wrong Quantity
Wrong Part
Late Shipment
Wrong Carrier
Duplicate Shipment
WrongAddress
Lost inTransit
10
80
70
60
50
40
30
20
6. Label the Axes.
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Constructing a Pareto Diagram (Cont)Constructing a Pareto Diagram (Cont)
List the problem categories in descending order from left to right on the horizontal axis.
ABC Electronics - Shipment Problems
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10
20
30
40
50
60
70
80
WrongQuantity
Wrong Part LateShipment
WrongCarrier
DuplicateShipment
WrongAddress
Lost inTransit
7. Construct the bar graph.
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Constructing a Pareto Diagram (Cont)Constructing a Pareto Diagram (Cont)
8. If desired, convert the frequency or cost for each item into a % of the total.
Calculate the percentages for the items from left to right, and cumulate from left to right.
Plot the cumulative percentages.
ABC Electronics - Shipment Problems
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10
20
30
40
50
60
70
80
WrongQuantity
Wrong Part LateShipment
WrongCarrier
DuplicateShipment
WrongAddress
Lost inTransit
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
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InterpretationInterpretation
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_
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Def
ect A
Def
ect B
D
efec
t C
Def
ect D
D
efec
t E
Def
ect F
D
efec
t G
Def
ect H
Oth
er
Vertical axis shows
counts (or cost)
These bars account for 80% of the problem.
Items are rank ordered from
left to right
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Interpretation (Cont)Interpretation (Cont)
The cumulative percentages…
show how much of the total problem will be fixed by addressing the vital few.
Indicate whether the Pareto Diagram is useful.
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Example - Defects vs OperatorsExample - Defects vs Operators
There are defects on drawings. A group of engineers use Pareto Diagrams. First, they plot defect against CAD operator.
What should they conclude?
JoshJakeJoe
JoanneJillJo
hn
9 91012121313.813.815.418.518.520.0
100.0 86.2 72.3 56.9 38.5 20.0
60
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0
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40
20
0
Defect
CountPercentCum %
Per
cent
Cou
nt
Pareto Chart for Operators
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Conclusion - Defects vs OperatorsConclusion - Defects vs Operators
Since none of the bars stand out from the rest, they conclude that defects are not related to differences among operators.
What shouldthey do next?
JoshJakeJoe
JoanneJillJo
hn
9 91012121313.813.815.418.518.520.0
100.0 86.2 72.3 56.9 38.5 20.0
60
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40
30
20
10
0
100
80
60
40
20
0
Defect
CountPercentCum %
Per
cent
Cou
nt
Pareto Chart for Operators
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Example - Defects vs ProductsExample - Defects vs Products
Someone suggests they look at product type versus defects.
What should they conclude?
Trim Cover
SeatFoam
FrameRecline
rTra
ck
2 311131422 3.1 4.616.920.021.533.8
100.0 96.9 92.3 75.4 55.4 33.8
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0
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0
Defect
CountPercentCum %
Per
cen
t
Cou
nt
Pareto Chart for Product
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Conclusion - Defects vs ProductsConclusion - Defects vs Products
They conclude that defects are not related to difference among products.
What should they do next?
Trim Cover
SeatFoam
FrameRecline
rTra
ck
2 311131422 3.1 4.616.920.021.533.8
100.0 96.9 92.3 75.4 55.4 33.8
60
50
40
30
20
10
0
100
80
60
40
20
0
Defect
CountPercentCum %
Per
cen
t
Cou
nt
Pareto Chart for Product
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Example - Defects vs Drawing Feature TypeExample - Defects vs Drawing Feature Type
Someone suggests they look at drawing feature type versus defects.They conclude most defects occur on section views.
Now they can do something!
Diameter
Position
Dimensio
n
Notes
Hidden views
Sections
1 2 2 3 651 1.5 3.1 3.1 4.6 9.278.5
100.0 98.5 95.4 92.3 87.7 78.5
60
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10
0
100
80
60
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20
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Defect
CountPercentCum %
Per
cent
Cou
nt
Pareto Chart for Type
This Pareto Diagram is useful!
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Uses of Pareto DiagramsUses of Pareto Diagrams Major Cause Breakdown (Drill-Down Pareto)
– Shows the “tallest” bar broken down into sub-causes in a second, linked pareto (see example on next slide)
Before and After – Shows “New” bars drawn side-by-side with the original to show the effect
of change (Caution: sample sizes of “Before” and “After” must be identical!)
Change Source Data – Data is collected on the same problem from different source locations,
equipment, etc., and shown on side-by-side Paretos
Change Measurement Scale – The same data is used, but measured differently. Typically cost and
frequency are alternated.
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Example: Drill-Down ParetoExample: Drill-Down Pareto
M9100 MECHANICAL TEST FAILURESW9739
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top plate not staked missing or wronggears
tight gears no apparent fault damaged gears
failure mode
freq
uen
cy
M9100 FAILURE SUMMARYW9739
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10
20
30
40
50
60
MECH T
EST
MAN/PW
A ASSY.
ELEC
TES
T
ROBOTIC G
EAR A
SSY.
PACKOUT
PIN C
OININ
G
SPRIN
G WIN
D
TOP
PLATE
PLA
CE/STA
KE
PIN G
REASIN
G
failure location
SP Watertown Plant M9100 Failure Data
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Exercise 12.1 – Pareto DiagramExercise 12.1 – Pareto Diagram
1. Refer to your workbook.
2. Construct a Pareto Diagram for the example provided.
3. What information does the Pareto Diagram provide?
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Exercise 12.2 – Exercise 12.2 – Pareto Diagram Using MinitabPareto Diagram Using Minitab®®
1. Refer to your workbook.
2. Follow along with the instructor to create a Pareto Diagram on the “Past Due Invoices” example using Minitab®.
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Remember!Remember!
Pareto diagrams are typically used to prioritize competing or conflicting problems and to distinguish the “vital few” from the “trivial many.”
Pareto diagrams determine which of several classifications have the most count or cost associated with them.
The base data gathered must be in terms of either counts or costs.
Do not use terms that can't be added, such as percent yields or error rates.
Remember to use Pareto Diagrams creatively.
If the first one doesn’t show an 80-20 pattern, then reconsider the problem and try again.
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Next StepsNext StepsCreate the process map
Collect data (Y’s) and prioritize
Checksheet Pareto
0
20
40
60
80 • Process Capability
PPM/DMPO
Sigma Level
Identify potential causes (X’s) of variation and defects
Cause & Effect MatrixCause & Effect Diagram
MeasurePhase