Which of the following activities are likely to be undertaken in Pareto Analysis?

Pareto Analysis is based on the 80/20 principle, which CIPS uses to help procurement professionals:

Identify the small number of items accounting for the majority of spend or value

Focus effort where it adds the most value

Key activities include:

Prioritising procurement time and resources (Statement 1 ✔)

Separating spend into critical few and trivial many (Statement 3 ✔)

Statement 2 relates to Kraljic portfolio analysis, and Statement 4 relates to supplier preferencing, not Pareto.

L4M6 Reference:

Learning Outcome 1: Understand procurement analysis and segmentation tools

Topic: Pareto (80/20) analysis

CIPS L4M6 Study Guide – Spend analysis and prioritisation