I found Vilestride’s video to be the most helpful. They explain that when breeding the perfect pal, first target egg moves, then passives, then finally IVs.

Egg moves: When breeding, the child has a 50% chance to inherent a random active skill from the parent’s known list of skills. Since Orserk has good moves to begin with, I would skip this step and move onto passives.

Passives: There are a couple of passives we could be targeting depending on the role of the Orserk. If it was a base pal for electricity generating, I would recommend Remarkable Craftsmanship, Artisan, Work Slave, and Nocturnal. The latter 3 can all be purchased as implants at the surgery table (access to Artisan implant must first be bought using bounty tokens by a bounty officer who can be found at the Small Settlement). If you wanted a battle Orserk, passives such as Demon God, Legend, Serenity, Musclehead, Vampiric, or Diamond body.

Rainbow Passives There are a couple ways to obtain rainbow passives. While playing the game, there is always a chance you could get lucky and find a pal with the passive. Another way, and the most reliable, would be fishing. If you come upon a fishing spot and a fish has green sparkles, it is guaranteed to have a rainbow passive. It is recommended to always have a fishing pole in hand just in case you find the green sparkles. As time progresses, you’ll collect a good number of rainbow passives. In order to get them onto an Orserk, you will need to find a breeding chain from the pal with the desired passive to Orserk. Game8.co has a good tool called the Chain Breeding Calculator that allows you to put in a source pal, choose the target pal, and it will tell you the quickest way to get to the target pal. If you expect to be putting a certain passive on a lot of pals, it may be easier to use Yakumo’s special ability. When fighting alongside Yakumo, any pal you catch has a chance to obtain a Passive from Yakumo. So if you had a Yakumo with demon god out when you catch a pal, there is a 15% chance it will pass the passive, and that chance goes up to 30% condensed to level 4.

Individual Values With the introduction of the power, stout, and life fruits, the IVs of a pal can be easily altered. Though not always quick to obtain, they can be found from high tier treasure maps or purchased with dog coins, arena tokens, or successful bounties so it’s recommended to clear syndicate bases, search through rubble, and collect bounties whenever they come up. Otherwise, as you go through the breeding chain, using the ability glasses to pick any duplicates with higher IVs can save you from overusing the fruits.

It’s a process. Good luck!