Pareto: The 80/20 Rule

Written By: Calvin Ball, MS, MLS(ASCP)CM, CLS

Several years ago I learned of the 80/20 rule. The concept was put to me like this, “Would you give up something that had 80% of what you are looking for, for something that only had 20%?” When you put it into terms of numbers, it would seem illogical to give up something that has the majority of what you want, for something that has very little of what you seek. I couldn’t believe something so simple escapes the normal test of logic in our everyday lives. Ever since I learned of the 80/20 rule, I’ve attempted to apply it to my everyday choices, including Quality.

In Quality Management, the 80/20 rule is also known as the Pareto principle and is visualized through a Pareto chart. Juran’s Quality Handbook (1998) describes the Pareto principle as follows, “This principle states that any population that contributes to a common effect, a relative few of the contributors – the vital few – account for the bulk of the effect.” This description exemplifies the meaning of the 80/20 rule: 80% of the problems are caused by 20% of the root causes. The Pareto chart transforms the Pareto principle into a process improvement tool that is a visual representation of the 80/20 rule.

The Pareto chart, as such, is utilized in the process of root cause analysis to organize the potential root causes (PRCs) identified during the use of the 5 Whys and the Fishbone Diagram and to identify – through a retrospective or real-time analysis – the number of times a problem is identified in a process when one or more of those PRCs are present. In the form of a histogram, the Pareto chart is able to show the number of times (Frequency) the process failure occurs when the PRCs are present.

Pareto Chart Process

The Pareto chart process begins by identifying all of the PRCs during the brainstorming process (Fishbone Diagram). Then, the laboratorian can perform a retrospective analysis of past process failures to identify when those PRCs were present during the process, or during a real-time analysis of the process and record when they are present. A useful tool for enumerating the number of times a root cause is present is the check sheet (Figure 2).

Check Sheet - 25June2018

Figure 1. Check Sheet for Massive Transfusion Protocol Blood Product Delivery >10 Minutes

The check sheet is used to record data for analysis. For use with a Pareto chart, the check sheet is a simple table with the PRCs listed in the vertical column and cells to mark the frequency of the process failure versus a constant variable in the header. Each time the PRCs occur in relation to the constant variable, a check mark or sequential number is recorded in the corresponding cell. The check sheet can be completed manually or updated electronically in an Excel spreadsheet. Once an acceptable number of samples are obtained, the results from the check sheet can be graphed using the pareto chart.

The Pareto chart should have the PRCs on the X-axis (horizontal axis) and the number of occurrences on the Y-axis (vertical axis). The PRCs with the largest number of occurrences should be placed on the left descending the axis to PRCs with the least number of occurrences. The number of occurrences for each PRC should be totaled to obtain the total number of occurrences, which will be the maximum value on the Y-axis. The percentage of the occurrences for each PRC should be calculated to identify the frequency of each PRC when the process failure is present.

Pareto Chart Ex. - 25June2018

Figure 2. Pareto Chart for Blood Bank delays greater than 10 minutes for issuing blood products upon initiation of a massive transfusion protocol.

This is where the 80/20 takes effect, 20% or less of the PRCs should be identified as causing 80% of the process failure occurrences. As shown in the Figure 2, The MTP not initiated in the LIS and CLS not familiar with the process PRCs accounted for approximately 80% (n=90) of the incidences where the initial issuance of blood products during an MTP exceeded 10 minutes. With a well-defined process failure, the Pareto principle/chart is a valuable tool; allowing for the highlighting of the root cause(s) to effectively enact meaningful solutions. Would you trade in a root cause that causes at least 80% of your process failures for one that only causes 20%?

References

  1. Juran, J. M. & Godfrey, A. B. (1998). Juran’s Quality Handbook. New York: McGraw-Hill Professional.