PARETO ANALYSIS – USAMA NADEEM (RDM)
Pareto analysis is a tool that is based on a very general and important rule which is the 80-20 rule. It considers that which alternative solves the most issues if it is selected or solves the problem the most effective way, when a problem is under consideration. The Pareto analysis is used to take decisions when there are several options and we have to chose an alternative. In general sense, it is used for effective solution of problems and help to chose the biggest issue that is causing the most problem and then solve it first. It does the cost and benefit analysis and look at the scores and eliminate the alterntives with lowest scores.
So, it is a very important too, since it helps to solve the issue and take decision by selecting the most effective that solves the problem in the best way. It also considers the costs and also the benefits to look at what is gained out of the alternative if we chose it.