One of the most important tools which is also the widely used one in Quality Domain – Pareto Analysis; a decision-making technique.
It is named after the Italian economist Vilfredo Pareto.
Pareto Analysis is a formal technique useful when many possible causes are competing for attention. In essence, the problem-solver estimates the benefit delivered by each action, then selects a number of the most effective causes that will deliver a total benefit reasonably close to the maximal compliant output.
While Pareto is commonly referred as “80/20” rule, under the assumption that, in all situations, 20% of causes (“Vital few”) determine 80% of problems, this ratio is merely a convenient rule of thumb and is not, nor should it be considered as an immutable law of nature. This is usually used for setting up priorities that impact an outcome the most. This helps determine where you can focus your efforts to maximize your output.