Six Sigma–The Pareto Principle: The Trivial Many vs. the Vital Few

In the eighth chapter of their book Six Sigma:  The Breakthrough Strategy Revolutionizing the World’s Top Corporations, the authors Mikel Harry, Ph.D., and Richard Schroeder discuss “Measuring Performance on the Sigma Scale.”   In the previous chapter, the authors discussed the Breakthrough Strategy of implementing Six Sigma on the business, operational, and process level.

In this chapter they focus on the question “how does improving the Sigma level of a company’s processes improve that company’s performance?”   In the last post, I referred to the importance the authors stress on treating persistent problems over sporadic ones.   The persistent problems are the ones that require the most effort, but their solution produces the most lasting benefit.

In this post, I describe how the authors stress the importance of solving the “vital few” vs. the “trivial many” problems by invoking the Pareto principle, developed by an eighteenth-century Italin economist Vilfredo Pareto.  Pareto’s law in the context of quality says that “80% of defects will be traceable to 20% of the different types of defects that can occur.”   The types of defects that account for 80% of the defects produced are called the “vital few”, and the types that account for 20% of the defects produced are called the “trivial many.”

Combining the discussion of the Pareto principle with the discussion in the last post regarding the distinction between sporadic vs. persistent problems, the authors rightly conclude that within each category the Pareto law holds.   That is, there is a Pareto distribution of sporadic problems as well as persistent problems.

So combining these two categories, the authors say that the best “bang-for-the-buck” that companies can get from their quality improvement activities is to go after the “vital few persistent problems”.  These cause the greatest headaches for companies, and going after them not only brings the greatest, well, headache relief, but the maximum results in terms of the bottom line.

The next post deals with the concept of “control limits”, which act like guardrails and lane markers on a highway to make sure the vehicle stays on the road.


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