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Pareto Charts are incredibly important in today’s businesses.
Why?
These charts plot the frequency of defects and their cumulative impacts on your business. And this makes it easier for you to prioritize the problems that need urgent attention.
Imagine the time and other resources you’ll save by adopting Pareto Charts as one of your go-to visualization designs. You have an option of supercharging your Google Sheets with an add-on to get access to Pareto Charts.
How to draw Pareto Chart for your data stories does not have to be stressful or even time-consuming.
This blog will walk you through steps and tips to get you started with Pareto Charts. Keep reading if your goal is to take your data storytelling skills to the next level with awesome library.
Before we cover the steps of plotting a Pareto visualization, let’s go through the definition.
In this blog, you’ll discover:
You can use a Pareto Chart, especially when you encounter multiple related problems or a common problem with numerous causes in your business.
Why?
A Pareto Chart empowers to categorize occurrences based on their impact towards a common strategic goal or objective. This visualization design aims to categorize key variables in your data based on their frequency of occurrence.
In other words, this chart provides you with in-depth and high-level insights into problems that require urgent attention and resources.
Pareto Chart is based on the classic 80/20 rule. The rule says that 20% of the causal factors result in 80% of the overall outcomes. For instance, 80% of the world’s total wealth is held by 20% of the population.
This easy-to-read chart prevents you from attacking the causes randomly by uncovering the top 20% of the problems, negatively affecting 80% of your overall performance.
A Pareto Diagram consists of two parts, namely:
Bars (in a Pareto Chart) are in descending order for you to uncover the most frequent problems first the line chart separates the 20% key variables from the rest (80%).
How to draw Pareto Chart in Google Sheets does not have to consume your valuable time.
Keep reading to discover fresh tips about this innovative and highly insightful chart.
So how does the 80/20 rule apply in Pareto Diagrams?
Pareto Analysis is a simple decision-making technique you can use to assess competing problems and measure their impact.
In other words, this technique empowers you to focus on solutions that provide the maximum benefits with minimal resources.
The 80/20 rule can really prove to be a solid framework for your business strategy. You can get most of out a Pareto Chart if you’re confronted by either of the scenarios (below):
You can use a Pareto Chart to identify the most frequent problems and categorize them based on their significance. To leverage Pareto fully, identify and list your problems and their root causes.
Then, score each problem according to its impact. The scoring system you use depends on the nature and type of problems you’ll fix.
A Pareto Chart is remarkable if your goal is to analyze problems with regard to their frequency of occurrence, time, or cost. Use this chart to focus on the most significant issues that require urgent fix due to their effect on the strategic goals.
How to draw Pareto Chart in Google Sheets does not have to consume your valuable time.
Picture this! How much time and other resources can you save if you focus ONLY on the significant issues that matter?
We rounded up a problem-solving framework for you using Pareto Charts. Check them out below.
Identifying a problem is the most significant step towards a solution and improvement. In other words, you’ve got to point out a problem before embarking on optimization efforts. There may be a single problem.
Or, you may be confronted by multiple problems at the same time.
How do you know the problems to prioritize to save your resources?
How do you point out problems that bear the most significant effect on your overall results?
Priority needs to be assigned to each of the problems you’re facing. Assuming a certain problem requires more urgent attention than others without the help of a Pareto is like participating in a blind archery competition.
How to draw Pareto Chart does not have to be a headache for you, especially if you want to diagnose problems facing your business.
No problem will occur out of blues. It has to be caused by some factors. Besides, some problems are superficial, while others have a solid causal agent.
Pareto Charts come in to simplify everything for you by uncovering insights into the core problems you should give 100% focus and resources.
Like we said earlier, most of the time, you’re confronted with multiple problems. And this means you have to score or rank their effect (positive or negative) based on their contributions.
Pareto Charts rank variables based on their contributions towards a particular key performing indicator, such as sales revenue.
So cherry-picking of insights into the problems that MATTER the MOST becomes easy peasy!
After prioritizing problems, the next logical step is to group similar ones together.
You can do this by aggregating smaller groups of problems with similar root causes. This approach to solving problems is one of the under-the-table tactics seasoned professionals use to save time and resources.
Similar problems may require a single solution (common resources and skills). Imagine the resources you can save by using a Pareto as your go-to problem-solving buddy.
Once you’ve done all the above, it’s time to take action. Yes, you read that right.
This is the time you commit resources strategically to derive maximum benefits with minimum cost.
As we said, how to draw Pareto Chart should not be a challenge to you. Keep reading to discover how to get started with Pareto Diagrams in your data stories.
Data visualization experts widely view Pareto Charts as a must-have tool for your optimization strategy.
This data visualization design consists of a bar chart (with x and y-axes) and a line graph. The x-axis displays the critical factor in your data, while the y-axis displays the frequency or count of occurrences depending on the shape of the chart horizontal and vertical the axis representation may change accordingly. All the bars (in a Pareto Chart) are arranged in descending order with respect to their frequency.
The line graph depicts whether your data follows the rules of Pareto: the 80/20 principle.
Check out below the key components of a Pareto Diagram:
It’s no secret there’re dozens of data visualization tools in today’s market.
Some of these tools require you to have uber technical skills, such as programming or coding. Others prioritize the beauty and aesthetic of charts at the expense of critical insights.
The third-party add-on we recommend to our readers is ChartExpo. And this is based on a checklist (below) we use to evaluate tools in the market.
ChartExpo scores 100% on all key factors we’ve featured in our checklist.
As we said, you’ve got to avoid scratching the surface of your data with basic charts, such as Bar Graphs. How?
You can achieve this by embracing Pareto Charts in your data visualization strategy. ChartExpo provides you with unlimited access to Pareto, plus more than 50 other charts.
And it gets better.
The cost of accessing these charts is ZERO. Yes, you read that right.
Let’s agree on this. How to draw Pareto Chart does not have to be stressful. Yes, it should not be the reason why you never get in-depth, actionable insights from your data.
Let’s take a look at an example (below) to get you started with Pareto Charts.
Imagine you run an e-commerce store. You want to know how your brand performs at the city level by comparing previous and current periods.
Which chart would you use to uncover the 20% of cities driving 80% of the overall brand’s sales?
Yes, you guessed right. This is where a Pareto Diagram comes in. Let’s use the table below for our scenario.
| City | Current Period Sales | Previous Period Sales |
| New York | 540 | 510 |
| Chicago | 550 | 545 |
| San Francisco | 415 | 399 |
| Los Angeles | 572 | 533 |
| Seattle | 193 | 185 |
| Boston | 188 | 163 |
| Phoenix | 497 | 485 |
| Atlanta | 215 | 180 |
| Philadelphia | 489 | 470 |
| Miami | 387 | 267 |
| Dallas | 7 | 5 |
| Houston | 5 | 3 |
| St Louis | 7 | 4 |
| Columbus | 1 | 1 |
| Fresno | 6 | 3 |
| Mesa | 2 | 2 |
| Oakland | 3 | 1 |
| San Antonio | 1 | 2 |
| San Diego | 1 | 1 |
| San Jose | 2 | 3 |
| Austin | 5 | 3 |
| Jacksonville | 3 | 2 |
| Fort Worth | 3 | 3 |
| Charlotte | 2 | 1 |
| Indianapolis | 1 | 2 |
| Denver | 4 | 3 |
| Washington | 5 | 2 |
| El Paso | 7 | 5 |
| Nashville | 5 | 3 |
| Detroit | 3 | 2 |
| Oklahoma City | 2 | 1 |
| Portland | 2 | 3 |
| Las Vegas | 3 | 2 |
| Memphis | 3 | 1 |
| Louisville | 4 | 1 |
| Baltimore | 5 | 3 |
| Milwaukee | 1 | 1 |
| Albuquerque | 2 | 1 |
| Tucson | 1 | 1 |
| Sacramento | 4 | 3 |
| Kansas City | 2 | 1 |
| Colorado Springs | 4 | 3 |
| Omaha | 2 | 1 |
| Raleigh | 4 | 3 |
| Long Beach | 2 | 1 |
| Tulsa | 4 | 3 |
| Tampa | 2 | 1 |
| Arlington | 4 | 3 |
| New Orleans | 2 | 1 |
| Wichita | 4 | 3 |
| Bakersfield | 2 | 1 |
| Aurora | 1 | 2 |
| Anaheim | 3 | 2 |
| Honolulu | 1 | 3 |
| Santa Ana | 3 | 2 |
| Riverside | 1 | 5 |
| Corpus Christi | 3 | 2 |
| Lexington | 1 | 1 |
| Henderson | 3 | 2 |
| Stockton | 1 | 1 |
| Saint Paul | 3 | 2 |
| Pittsburgh | 1 | 2 |
| Lincoln | 3 | 2 |
| Anchorage | 1 | 1 |
| Plano | 3 | 2 |
| Orlando | 1 | 2 |
| Irvine | 3 | 2 |
| Newark | 7 | 3 |
| Durham | 5 | 1 |
| Chula Vista | 2 | 2 |
| Toledo | 5 | 1 |
| Fort Wayne | 2 | 1 |
| Lubbock | 5 | 2 |
| Jersey City | 2 | 2 |
| Scottsdale | 5 | 3 |
| Reno | 2 | 3 |
| Glendale | 5 | 3 |
| Norfolk | 2 | 1 |
| Irving | 5 | 2 |
| Garland | 1 | 2 |
| Hialeah | 4 | 1 |
| Richmond | 1 | 3 |
| Boise | 5 | 2 |
| Tacoma | 1 | 1 |
| Fontana | 5 | 1 |
| Birmingham | 1 | 1 |
| Frisco | 2 | 1 |
| Augusta | 1 | 1 |
| Tempe | 2 | 1 |
| Little Rock | 1 | 1 |
| Overland Park | 2 | 1 |
| Grand Prairie | 1 | 1 |
| Ontario | 2 | 1 |
| Brownsville | 1 | 1 |
| Santa Rosa | 2 | 1 |
| Eugene | 1 | 1 |
| Lancaster | 2 | 1 |
| Palmdale | 1 | 1 |
| Joliet | 2 | 1 |
| Midland | 1 | 1 |
How to draw Pareto Chart does not have to be time-consuming. ChartExpo makes the whole process seamless and easy.
Los Angeles, Chicago, New York, Phoenix, Philadelphia, San Francisco, and Miami are the best-performing cities. In other words, they constitute 20% of cities driving 80% of the overall sales revenue.
As we said, how to draw Pareto Chart in Google Sheets does not have to consume your valuable time.
You can use a Pareto Chart to identify the most frequent defects, problems, and complaints within your business. To leverage Pareto Diagrams fully, identify and list the problems that you face and their root causes.
Then, score each problem based on its effect on the attainment of strategic goals.
Pareto Visualization Design consists of a bar chart (with x and y-axes) and a line graph. All the bars are arranged in descending order with respect to the frequency of the key data points.
The line graph depicts whether your data follow the 80/20 principle.
Spreadsheet apps like Google Sheets and Excel lack Pareto Charts.
And this is where third-party add-ons, such as ChartExpo, come in to help you extract in-depth insights from your data with advanced charts. How to draw Pareto Chart does not have to be time-consuming or even complex.
Like we said earlier, Pareto Diagrams are incredibly important in today’s businesses.
These charts plot the frequency of defects and their cumulative effect on your business. And this makes it easier for you to prioritize the problems that need urgent attention.
However, you cannot access these highly insightful and easy-to-read charts via freemium spreadsheets apps like Google Sheets.
We recommend our readers to use the ChartExpo add-on to supercharge their favorite spreadsheet app (Google Sheets).
Why?
This intuitive data visualization tool comes pre-loaded with over 80 charts and graphs that are easy to read and interpret. Besides, it has an ultra-friendly user interface (UI), which means you don’t need coding or programming skills to visualize your data using Pareto.
How to draw Pareto Chart should never stress you again starting from today.
Sign up today to access Pareto Charts, plus more other advanced charts, all for FREE.
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