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Determining Specifics of 20:80 Rule (Pareto)

  1. Feb 2, 2016 #1

    WWGD

    User Avatar
    Science Advisor
    Gold Member

    Hi,
    The 20:80 , aka Pareto rule applies in certain processes. Pareto states that in some cases,
    20 percent of the input generates 80% of the output (obviously not intended to be exactly
    20 and 80). Example: 20% of customers generate 80% of the revenues , or 20% of a list of
    problems in an operating system generate 80% of customer complaints, or 20% of the population
    owns 80% of assets.
    Anyway, my question is on how do determine if/when the Pareto distribution applies to a given
    situation , or if there are some general results on how to apply it.
    EDIT: I am trying to understand the type of data one would have to look at and, given the data, how one
    can "tease out" from the data whether there is a 20-80 relation.
    Thanks.
     
    Last edited: Feb 2, 2016
  2. jcsd
  3. Feb 2, 2016 #2

    Dale

    Staff: Mentor

    To the best of my knowledge there isn't such a rule. It applies in a lot of situations, but there isn't something that you can use to predict in advance when it will and won't apply. Basically you check any given scenario and say "it worked" or not. It is really just a heuristic.
     
  4. Feb 2, 2016 #3

    phinds

    User Avatar
    Gold Member
    2016 Award

    My experience/belief is the same as Dale's
     
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