project-management.com’s Top 3 Software RecommendationsLet Monday.com work for you.Start Free TrialWork smarter with Wrike.Try for FreeIncrease productivity with Smartsheet.Try Smartsheet for FreeWhat Is a Pareto Chart?
A Pareto chart, a bar chart, is named after Vilfredo Pareto, an Italian economist. It is used to analyze problems or causes by cost, time, or frequency of occurrence. It helps to identify the most important or pressing issues.
According to Asana, the Pareto principle (or 80-20 rule) “is a phenomenon which states that approximately 80% of outcomes are due to 20% of causes.” Pareto charts show a relationship between two numbers where relative changes in one quantity result in a proportional relative shift in the other. These quantities, their changes and their relationship with other quantities are displayed in a Pareto chart, such as the one below.
The Pareto chart depicts an example of how to assess a product’s quality.
The number of failures in a particular type.
The percentage of failures for each type among all failures
This information allows production and quality managers to identify the failures they need to address first, namely those that occur most often.
How to read a Pareto chart

The bars’ lengths are shown in units along the left vertical axis. They typically indicate frequency of occurrence but can also be another unit.
You can see how the bars are arranged. The horizontal axis runs from the left to the longest bar. Each bar becomes shorter. This arrangement makes it easier to see the raw data and its meaning. This allows us to see the most common causes of tardiness, as well as the least common.
The right vertical axis may represent the cumulative percentage of all occurrences or any other total that is greater than 100%. The line graph displays the running total by adding the value of each bar to the cumulative percentage at right vertical axis.
Pareto principle, or 80-20 rule, is a generalization that does not distribute at an exact 80/20 ratio. It does however provide a trend or direction that can be quickly displayed in a Pareto chart.
Pareto Chart Use Cases
The principle behind Pareto charts is useful in a variety of applications.
Quality control: A lower percentage of defects is responsible for most quality problems in products
Sales: Maximize your total sales by leveraging larger customer accounts
Customer support: Most complaints are from a small number of customers
Finance: Find out which investors provide the most funding
Marketing: Imagine how a lower number of articles is generating more traffic.
Project management: How much effort is required to complete a few key tasks in order to maximize productivity
Pareto charts can be used in project management to prioritize the most important or pressing tasks. Pareto charts can be used by project managers to:
Prioritize the 20% most important tasks and determine the priority.
Give more time to 20% of the most time-consuming tasks
Be prepared for the 20% of the most severe risks
A chart can be useful when you need to evaluate a problem that has many causes. Pareto charts can be used as visual tools to communicate data and ideas effectively to stakeholders.
How to build a Pareto Chart
You can group the causes and factors into certain categories.
You can choose the appropriate measurement (frequency, quantity, cost)
Define the time period of the chart, such hour, day or week.
Take the data and calculate the subtotals of each category.
To accommodate the largest subtotal of the different, adjust the scale of the left vertical axis.