Work order variance analysis

The five variance types and what each is telling the business — usage points at scrap, yield or a wrong bill of materials; efficiency at a process, training or routing problem; price at purchasing or a stale standard. Then the uncomfortable truth: a large persistent variance usually means the standard is wrong, not that the plant is failing. Check the work definition before telling a plant manager they are 12% inefficient. That single piece of advice will save a difficult meeting at least once.