Learning objective
By the end of this lesson, you can select a Pareto measure that matches the decision and recognise when frequency hides cost or severity.
Why it matters
The same categories can produce different priorities when ranked by count, time, cost or harm. The chart does not choose the business outcome for you.
Core concept: decision first, measure second
Examples:
- reduce total complaints → count or rate;
- reduce support workload → handling time;
- reduce financial loss → cost;
- reduce customer harm → severity-weighted measure plus separate critical-event controls.
Visual explanation
Worked example
Two categories:
- Delivery failure: 80 cases × 2 minutes = 160 minutes.
- Wrong appointment time: 45 cases × 10 minutes = 450 minutes.
By frequency, delivery failure ranks first. By workload, wrong appointment time ranks first.
If the decision is to reduce support hours, total handling time is the better measure.
Common mistake
Mistake: treating a high-frequency category as a cause.
“Wrong appointment time” is a problem category. The causes may involve data synchronisation, user input, timezone conversion or process design.
Quick check
You want to reduce refund cost. Which measure should drive the first Pareto chart?
A. Number of category names
B. Complaint count only
C. Total refund value by category
D. Alphabetical order
Answer: C.
Practical prompt
Choose a current prioritisation problem. Write the decision question, compare two possible measures and explain how they could change the ranking.
Summary
- The decision determines the measure.
- 80/20 is not a required result.
- Pareto identifies where to investigate, not why the issue occurs.
Next lesson
Continue to PDCA to test and sustain an improvement in the selected focus area.