ABC Analysis
ABC Analysis is an inventory categorization technique that classifies items into three categories (A, B, and C) based on their value or importance, typically using the Pareto principle where a small percentage of items account for a large portion of the total value. It helps organizations prioritize resources and management efforts by focusing on high-value items (A), moderate-value items (B), and low-value items (C). This method is widely used in supply chain management, inventory control, and business analysis to optimize efficiency and reduce costs.
Developers should learn ABC Analysis when working on systems involving inventory management, resource allocation, or data prioritization, such as in e-commerce platforms, warehouse management software, or financial applications. It is particularly useful for optimizing database queries, caching strategies, or feature development by identifying critical components that drive most of the business value, allowing for targeted improvements and efficient use of development time.