The Pareto Principle, named for Italian economist Vilfredo Pareto, suggests that 80% of problems can be traced to as few as 20% of root causes.  This can be valuable, even vital information when you are trying to figure out which of many problems to tackle first, or in a complicated troubleshooting environment.
For example, you have just been asked to lead a struggling project team to get them back on track.
I’m here to walk you through the steps to get your data prepped for a Pareto chart then how to create the chart itself.
In today’s problem scenario, we have a company that reimburses employee expenses regularly. Next, create a Cumulative Percent column.  You can use the Amount total and each cumulative amount to build this column. Now either double click on the Auto Fill Handle to fill in your data or click and drag the handle down your column of data. Quick Tip: Press ALT and F1 on your keyboard to automatically create a chart from the data.
Click in the chart and use your keyboard’s arrow keys to toggle between areas on your chart. Now that you have the step-by-step tips to setup and create a Pareto chart in Excel, give it a try.
Excel Tips & Tricks is written by the Microsoft® Excel® experts at Fred Pryor Seminars and CareerTrack.
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This interactive software gives you access to hundreds of templates that will help you with writing any and every kind of business correspondence! This interactive software gives you dozens of "best practice" business templates for effectively managing budgets, financial reporting, forecasting, revenue and expense analysis, tracking, and more! If you use Excel for reporting on results each month, you have probably needed to adjust your charts automatically to add a new month, state, or sales rep.
Unfortunately, it is easy to miss an update, and nobody likes turning in the monthly reports to the boss and hearing, “Why don’t these charts include February?” Wouldn’t it be nice if the chart adjusted itself automatically? Your chart will adjust itself to include new rows and column in your data if you base the chart on a table.

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You ask the team members what their main obstacles have been in terms of meeting objectives and expectations.
Using a Pareto chart in Microsoft Excel could have sped the process up for you considerably. They are unique because they typically have one horizontal axis (the x-axis) and two vertical axes. If you have already formatted your data for a Pareto chart and you can skip down to part two. We want to know where we are spending the most on and how we can reduce that cost by 80% with a quick Pareto analysis. When Cumulative % is highlighted on the x-axis, hover and right click Change Chart Series Type. Our findings: training fees, hardware and office supplies make up the bulk of our expenses.
You can apply the Pareto analysis to identify your biggest problem areas and make a huge impact by addressing them. In order to post comments, please make sure JavaScript and Cookies are enabled, and reload the page.
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Quickly create high-impact business correspondence by placing your text in pre-created templates that reflect your best image every time. Typically, that means clicking on each chart and adding a new data series or expanding the range of the current series. Click on the word “State” and, holding down the mouse button, drag until you have selected the entire range.

Your data table is enclosed by a thin border with a right angle bracket on the lower right corner. Drag that bracket to the right (to add a month) or down (to add a state), and the chart adjusts automatically to include the new data.
Do you ever need to graph, say, only the last three months, and do you want your chart to update itself automatically to show data from those last three?
Unfortunately, the new flexibility comes with increased complexity and more opportunities for errors. A former product executive at Nationwide Insurance, she uses her more than twenty years of experience in insurance product management and actuarial services to help individuals and entrepreneurial organizations with their geek needs. They make the list, and you analyze it to figure out what the root causes are for each of the problems are that they are experiencing, looking for commonalities. You realize that by fixing the communication problem you can eliminate a huge percentage of the problems, and by fixing the resource access problems you can clear nearly 90% of the team’s hurdles. We can find which reimbursements account for 80% of cost and prevent high costs in the future through policy changes, quotes on bulk pricing and a discussion of employee expenses. The “$” figures create an absolute reference so that the Amount total (B9) does not change when you drag the formula down. Are you, as a team member or team leader, doing your part and making the most of your team's abilities in order to achieve common goals? On the other hand, when roles are assigned effectively, expectations are clearly communicated, and team members feel part of something bigger than themselves, the product of teamwork can surpass expectations.
Having trouble finding the time to create those performance reviews, manage and maintain an accurate budget, write that company proposal, design a professional-looking presentation or even just keep yourself organized? To make your table and your chart easier to understand, add labels at the top and on the left.
Not only have you figured out how to help your team, you’ve just performed a Pareto analysis. Attend one of our outstanding Excel courses and gain the knowledge you need to use Excel more effectively and efficiently.
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